The Tax Questions Blog

Archive for October, 2010

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Question: The primary economic advantage of the European Union (EU) to its members is that:?

An important outcome of the Uruguay Round of GATT negotiations was:
a) a worldwide reduction of agricultural export subsidies.
b)establishment of the European Union.
c)the elimination of all tariffs and quotas worldwide.
d)establishment of the World Bank.
2. The primary economic advantage of the European Union (EU) to its members is that:
a)the tax structures of each participating nation have been made nearly identical.
b) each nation is free to formulate its own antitrust and agricultural policies.
c) participating nations must all use a common currency.
d) the reduction of trade barriers permits producers to achieve mass-production economies.

Answer: Primary would be...A single currency.

This means that there are no longer separate national monetary policies, and instead a new central bank has been set up – The European Central Bank – that conducts a Europe wide monetary policy, in particular the setting of interest rates. That means a loss of separate national monetary policies – interest rates and exchange rates. Should Germany want to introduce an economic policy to fight back against unemployment, it cannot do so as this can only come from the European Central Bank.

Domtar profits soar but paper producer concerned about high unemployment

MONTREAL - Domtar says persistently high unemployment could have an impact on demand for office paper in the coming months as North America's largest single-sheet paper producer beat expectations by posting strong earnings in the third quarter.

Investment Terms & Facts : What Is a Retirement Annuity Account?

Question: Are accelerated insurance benefits taxable?

I recently received an accelerated benefit due to cancer from a life insurance policy and wanted to know if it is taxed.

Answer: Insurance benefits should not be taxed. It is the benefit you are buying from the insurer based on the contract policy when the insurer sells you an insurance. It is seller insurer therefore who will be taxed the moment you buy or paid the contract policy. In business including insurance business, it is the seller that is being taxed not the buyer.

Avoiding a Legacy Nightmare You might not be worried about night time monsters hiding under the bed but you should be concerned with the many ways poor planning can turn your estate into a barren, nightmare landscape for your loved ones. Avoiding a Legacy Nightmare helps you start an internal conversation about what your legacy means to you and what you want it to accomplish. More than that, it’s a simple guide to help you...

Taxation of corporate-owned life insurance policy proceeds payable to shareholders.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA's on August 1, 1992. The length of the article is 1390 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: C...

Health Care USA: Understanding Its Organization and Delivery, Seventh Edition $72.49 Health Care USA, Seventh Edition, offers students of health administration, public health, medicine, and related fields a wide-ranging overview of America s health care system. Combining historical perspective with analysis of modern trends, this expanded edition charts the evolution of modern American health care, providing a complete examination of its organization and delivery while offering cr...

Mary Holm: Bank bashing proves too hasty

I have had a considerable sum of money on term deposit in Westpac. The term ended on a Saturday but none of the money reached my bank account until Tuesday. All my money, principal and interest, "disappeared" for three days.Where...

The role of life insurance in your estate and financial planning, Part 2 of 3

Question: LOW Road Tax of £35.00?

I am trying to find out if there is a website which gives all the cars in the low ROAD TAX of £35.00 per year in Group B(emission of 119)

I know of only two so far

New VW Polo 1.4TDI
Citroen CI

any others ?
Thanks Neil

Answer: There is a site which gives all cars in any given tax band that are currently available as new.
It is at http://www.vcacarfueldata.org.uk/search/vedSearchResults.asp?Band=B&Price=35&fuel=3&co2=101-120
and is run by the Government's Vehicle Certification Agency.

There is no list that I know of that also includes models no longer available as new.

Boo's cues: 16 ways to scare up Halloween fun this weekend

There's a lot of escapist fun around here this Halloween weekend, from haunted houses and a parade to ghost tours and zombie walks.

Salt Lake City Deserves Clean Air

Question: A question on selling mutual funds?

I have 4 mutual funds in a non-retirement acct that I have never cashed out on. I have reinvested the capital gains distribution each year. If I decide to sell all or part of the funds, how do I report this on my taxes? Are the capitals gains that I already paid tax on taxable again or taxed on what they gained ?

Another question on 3 funds in my Roth IRA....can I sell or exchange mutual funds inside the roth without a penalty or tax consequence?

Answer: Rely on the funds to send you a statement ( usually before Feb.1 ) of any amounts that are " taxable"...some as cap gains ( lng or shrt) some as divs.
Nothing in the ROTH is taxable... trading gains , cap gains, divs are all yours...and they aren't taxed when you withdraw, either. That's why a ROTH is so precious... educate everyone you know and love to use them to the fullest extent.
That info applies to government liability...you still have to abide by the trading and/or exchange rules of your investment company...i.e. " short-term" trading fees and such.

PassKey EA Review Workbook: Six Complete Enrolled Agent Practice Exams 2013-2014 Edition $51.96 Use this book to prepare yourself for the EA exam offered during the May 1, 2013 to February 28, 2014 testing window. This workbook includes two full exams for each of the three parts of the EA exam: Individuals, Businesses, and Representation. All the answers are clearly explained in the answer section in the back of the book. Using the Prometric exam format, you can test yourself on the foll...

The Complete Idiot's Guide to Investing, 4th Edition $10.07 A penny saved may be a penny earned, but a penny invested can be even more. In this financial crisis, old advice about equities, mutual funds, commodities, and real estate may no longer hold. Here is a fresh look at all aspects of investing to help readers protect and grow their wealth. This edition includes the most current information on: corporate fundamentals; the sub-prime crisis and its effe...

Accounting Core Concepts For Executives $26.59 Accounting is the language of business, the means by which business people communicate with each other. As an executive you need to know the numbers: profit and loss, what your business owns, and what your business owes to creditors. Additionally you need to know what it costs to make or acquire a product so that you know how much to sell it for. Same concept applies to selling a service. You need...

Deadlines Loom For Tax-Saving Accounts

If you can save more now, you may be able to cut your taxes for 2010 or in the future.

Roth IRA Conversion Analysis

Question: Christmas party gifts, tax implications for company & employee.?

We are planning our X-mas party & the wanted to give out several gift cards/possibly cash awards & bigger prizes like a big screen TV or a trip somewhere. I brought up the fact that any of these "gifts" would be considered taxable & we would either need to issue a 1099 for the value of the prize, or if the company wanted to put it on their paychecks at a "grossed up" amount to cover the taxes. (like if they win $50 adding $70 to wages to equal a $50 prize after taxes)

Am I correct in the sense that if you give these things out, you need to include them in wages or issue a 1099. I am no tax expert & not trying to avoid paying taxes, its just I don't want the "prize" to be a negative feeling since the employee might have to pay taxes on them.

Any good suggestions on handing this so you minimize the chance that employees will view this as a negative?

Thanks for your time.

Answer: As bostonianinmo said, you have to treat it as wages so they will pay income tax, social security tax, medicare tax, and state income tax on the amount of the prize. So if you don't want to have it seen as a negative, you might want to give each a extra amount - $25 cash if they win a $50 prize. They will have to pay tax on $75 but they have $25 with which to do so. That way you are hero - if they like the prize, they will like it even more if it is an after-tax prize - if they don't like it, at least it does not cost them anything. And I would take credit for it to by telling them that is why you are getting the cash - to make the prize an after-tax one.

Tax Preparation Made Simple: Based On 2011 Tax Law $27.79 This book will give you the tools to prepare some of the most common tax returns. As you read through each chapter, you will learn the tax laws, and see them in practice in examples. Throughout the book there are questions and tax problems for you to work out yourself because the best way to learn something is through practice. You can check your work by looking in the Appendix. There are two part...

Bank's lottery account no golden ticket

Savers tempted by BoQ plan warned they're better off buying lotto ticket.