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August 2006
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October 2006

September 2006

Why didn't a Texan think of this?

A Brooklyn tax preparer has been getting big federal refunds for his clients by declaring that New York State is a separate country. Under the preparer's logic (OK, we'll use that word, advisedly, for now), wages earned in the state are “foreign” income, qualifying NY filers for the foreign earned income tax exclusion. No surprise that federal officials respectfully disagree with the tax pro, Garry P. Webb-Bey, and have hauled him into court. According the U.S. Justice Department lawsuit, Webb-Bey has frivolously claimed $335,000 in refunds and his clients have received actual IRS checks totaling more than $97,000. You can... Read more →

South Carolina tax changes start taking effect this weekend

On Sunday, Oct. 1, grocery bills in South Carolina will be a bit smaller. That day, the state's sales tax on food items will drop from 5 percent to 3 percent. But what state lawmakers give, they also take away. In June 2007, South Carolina's state sales tax on all other items will increase by a penny to 6 percent. Some homeowners, though, will see their property tax bills, which will be arriving in the next couple of months, cut in half. The decrease is possible thanks in part to the coming state sales tax hike. And when the big... Read more →

Beyond nest eggs: I and the Bird #33

This is a personal finance blog, with a special eye kept on taxes and how they affect efforts to build a nest egg. But as regular readers know, I'm a firm believer in integrating real life into financial life. After all, it doesn't matter how nicely you feather your financial nest if you don't use some of your earnings to follow what makes you happy. For many people, travel is their passion. And that's particularly true of birders, who take every chance they get to glimpse birds in locales near and far. So as host this week of I and... Read more →

When renting is the right choice

As regional real estate bubbles are popping, many folks are reassessing home ownership. That's not necessarily a bad idea. True, in the long run, owning a home has lots of advantages, personal and financial. But owning property just to own it could be a costly mistake. I know several people, mostly younger folks, who as soon as they got married just had to buy that three-bedroom house in the 'burbs. They didn't want to start with a small home or condo and build some equity and trade up. They had to have it all, right then. And in at least... Read more →

Colbert aweigh!

The Tropical Tax Haven Heaven Cruise '06 faux commercial has left the dock! Comedy Central has corrected the glitch in Stephen Colbert's tax cruise bit I mentioned yesterday. Watch it, with its fine fabricated tips such as minimizing your tax burden with Willie Nelson, by clicking here. Then, if you missed yesterday's post on offshore tax haven scams, go back and check it out, too. Because as inviting as some of these purportedly real tax-saving prospects might sound, they could leave you in a very small lifeboat among a sea of IRS auditors. Read more →

Cruisin' for tax trouble

If you watched the Colbert Report last night, you caught his "commercial" for the 2006 Colbert Cruise. The theme this year: taxes, specifically visiting the islands where you can hide your income from the IRS. Normally, I'd put the link to and/or the video itself in here, but the clip is not working over at Comedy Central. Not funny guys! You can try it yourself here; maybe they'll eventually be able to make it work. In reality, though, looking for offshore tax havens is usually not a good idea. You might recall from this earlier post, Congress took a look... Read more →

All hat and thirsty cattle

We tend to think of natural disasters in terms of sudden, horrifying events that sweep through an area and ravage the countryside, as well as the psyches of its residents. But disasters can be just as devastating at a much slower pace. Take, for example, drought. You go a few days without rain. That stretches to weeks, then months. One day you look at the calendar and a year has passed without any appreciable rainfall and it seems like every ounce of water around you has dried up. We're in the midst of that here in Central Texas. Oh, we... Read more →

Carnivals are acoming

It's going to be a busy week here at the ol' tax blog. First, we're taking a brief break from taxes on Thursday. That day, Sept. 28, we will be hosting the next edition of I and the Bird. We're delighted to be tapped as hostess, since IatB is THE Internet birding hot spot. Regular readers know that our feathered friends are one of my nontax passions, so I'm looking forward to putting together a group of fine avian bloggings from some of cyberspace's dedicated birders and naturalists. If you've got a bird-related submission, send it along by Tuesday, 9/26,... Read more →

Money maneuvers for military men and women

While the fighting goes on in the Middle East and politicians and th e citizens who elected them debate what moves to make next, our military personnel are dealing with not only potential personal safety concerns, but also money issues. Regardless of whether you (or a loved one or a neighbor or a coworker) is active military or on-call via the reserves or National Guard, you face special financial considerations, both in times of peace and war. Many issues, such as debt management, routine financial transactions and insurance coverage, are ones civilian and service personnel alike must handle. Others, such... Read more →

Toyota time ticking down

Time is rapidly running out for a tax break available to purchasers of fuel-efficient autos produced by Toyota or Lexus. You just have until Sept. 30 to buy one of the Japanese automaker's hybrid models in order to claim the full tax credit on your 2006 tax return. Come Oct. 1, the credit is slashed in half for each Toyota/Lexus hybrid model. If you can drive off a dealer's lot in just a little over a week, you can claim one of the following credits next filing season: 2007 Toyota Camry Hybrid -- $2,600 2007 Lexus GS 450h -- $1,550... Read more →

And the Fed said

The federal funds rate, the rate that lenders charge each other on overnight loans, stays at 5.25 percent. That means our consumer interest rates should hold steady, too. Ben Bernanke and his Federal Open Market Committee colleagues said, in a very brief post-meeting statement, that part of the reason they took no action for the second straight month is because economic growth is being tamped down by "a cooling of the housing market." The panel also said, though, that it "judges some inflation risks remain." To me, that's Fedspeak for "we're hedging our bets when it comes to the Oct.... Read more →

Ben Bernanke: One groovy Fed head

At its meeting today, the Federal Open Market Committee is expected to leave the federal funds rate at 5.25 percent. That's good news if you've got an adjustable rate mortgage, home equity line of credit or are carrying a balance on your credit cards. But it also means that Fed Watchers will have to dig a little deeper to get an idea of what the Committee really thinks about the state of our economy. Since the numbers probably won't change, economists will have to pay extra attention to the words, i.e., the Committee's statement, which will accompany the rate announcement.... Read more →

Healthcare shopping season

I'm getting a late start today because I spent the morning at the doctor's office for my annual checkup. There's no need to go into detail here. Everybody knows the drill. You arrive on time. You sign in. You wait. You assure the business office that all your insurance information hasn't changed or, if it has, you refill out a dozen forms. You wait. You get called back to the exam area. You endure the worst part of the visit -- the nurse weighs you. Well, for me that's always the most painful part! You're ushered into a freezing exam... Read more →

Kids and houses highlight the latest PF Carnival

If you're looking for a compendium of recent money bloggings, then look no further than this week's Carnival of Personal Finance, hosted and posted this time by Free Money Finance. There are a couple of bloggings on kids and money that caught my eye: Teaching a Six-Year-Old to Save by Raising4Boys and Teaching Kids About Money by The Road 2 Riches. Why, you might ask, since the hubby and I have no Mini-Mes of ourselves, am I reading and recommending these items? Because, I answer, sometimes we all are pretty childish, chronological age notwithstanding, when it comes to money. So... Read more →

Tallying our West Texas wanderings

It's been almost a week since my cousin and I rolled back into Austin. Today, I finally pulled together the vital statistics of our trip down memory lane. The raw travel numbers: 1,470 miles 125 digital photos 17 bottles of water 6 days 5 nights 5 hotels 5 dinners 5 lunches 5 gas station stops 3 breakfasts Assorted admission fees and tourist tchotchkes 1 confirmation that you really can't go home again 1 realization that you can create new memories to enhance your earlier ones Now to translate those figures into dollars. Kathy and I split the costs, but not... Read more →

Painted pigs and combination plates

In reading the multitude of Ann Richards tributes, I ran across a collection of some of her memorable quotes in the New York Times. You'll need to register to read them all, but here are a few of my favorites: Asked once what she might have done differently had she known she was going to be a one-term governor, Richards grinned and replied, "Oh, I would probably have raised more hell." "I get a lot of cracks about my hair, mostly from men who don't have any." And in discussing ineffective government programs, "You can put lipstick and earrings on... Read more →

Education proposal includes new tax breaks

Tired of waiting on the Senate's GOP leadership to reinstate expired tax breaks, the Finance Committee's ranking Democrat, Max Baucus, has Introduced his own package of education tax incentives. The Montana lawmaker's Education Competitiveness Act of 2006 includes a tax section that creates, expands, modifies or extends various tax breaks for education-related expenses. Specific provisions for individuals would: Allow taxpayers who do not itemize to take an additional standard deduction for state and local property taxes used to fund public education. Single filers would add $500 and joint return taxpayers would add $1,000 to the existing standard deduction amounts they... Read more →

Tax filing time again

Sorry to interrupt your vacation that started when the kids finally went back to school (love that Staples "most wonderful time of the year" commercial), but your tax professor, Uncle Sam, has an assignment for you. Your third installment payment of 2006 estimated taxes is due tomorrow, Sept. 15. Actually, you just have to get it in the mail so that the envelope's postmark shows that date, the same "timely return" standard (Section 7502 of the Internal Revenue Code) accepted for your annual 1040. I toyed with mailing our third quarter 1040ES voucher tomorrow. That would give the hubby and... Read more →

Thanks Ann

Texas lost a bit of its heart and soul Wednesday night with the passing of Ann Richards. Intelligent, insightful and wielding a tongue as razor sharp as her wit, Gov. Richards always cut to the heart of the matter, be it politics, social issues or economic concerns. A woman of grace and wit, she was the quintessential Texan. She owns a special place in the hearts of those of us old enough to remember just how hard it once was for women to aspire to, much less attain and succeed in, leadership positions. What we women now take for granted... Read more →

Stop it, stop it right now!

That's the order from a group of U.S. Senators to the IRS regarding the agency's use of private debt collectors to bring in unpaid tax money. Senators Byron Dorgan (D-North Dakota) and Patty Murray (D-Washington) yesterday introduced S. 3887, which, if it becomes law, would halt the privatization effort. Such a reaction is not a big surprise. This bill was a definite possibility that I mentioned last week when this questionable collection process began. Many lawmakers agree with tax experts and consumer advocates that this is not a good idea, for several reasons: An earlier attempt in the 1990s failed.... Read more →