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October 2006

Bogleheads on Taxes

Welcome to Chapters 10 and 11 of "The Bogleheads' Guide to Investing" consolidated book review. If you missed my earlier announcement of the project, you can find details on it here. As you've probably already guessed, these two chapters deal with taxes. A fitting topic for Friday the 13th. For many people investing itself is scary. Tax considerations just compound that fear. It's not an unreasonable reaction, but the Bogleheads do a very nice job of helping ease such trepidation. Naturally, the topic of investment taxation could itself fill a book. So authors Taylor Larimore, Mel Lindauer and Michael LeBoeuf... Read more →


It's good to have friends in high places

No one ever quibbles with that truism. Here's another one: All politics is local. Now the two adages have converged. Trent Lott, Mississippi's junior U.S. Senator and former majority leader of that legislative body, is taking insurance companies to task for what he sees as potential fraud in shifting the burden of Hurricane Katrina damage payments to a federal insurance program. The Republican lawmaker also has denounced the insurance industry for its "insensitivity and outright meanness" in rejecting many homeowners' claims. One other thing. Lott isn't just speaking out on behalf of his storm-battered neighbors and constituents. His own claim... Read more →


Carnival of Personal Finance #69

The cash carnival continues, this week thanks to the Carnival of Personal Finance home blog. Items range from the King of Cash's warning about an annoying (and costly) e-banking change at Bank of America to fivecentnickel's look at the save for retirement or kid's college quandary to the Coin Jar's one question you should ask yourself before making any expenditure. I'm pleased to report that my item on money issues facing members of the military also made this week's midway. So head on over to the latest PF Carnival. I'm sure you'll find plenty of fine fiscal advice. Read more →


Divorce deduction denied

The end of a marriage has many costs: sometimes physical, obviously emotional and most definitely financial. And when there are financial implications, there generally are tax considerations. If alimony is part of the breakup equation, the spouse who receives it has to report that money as taxable income. But the ex who's paying it gets to deduct the monthly contributions to the former husband or wife. Usually. But not in the case of one couple. The IRS has determined in a letter ruling that one former husband forfeited the alimony deduction when the couple's divorce decree was modified. It started... Read more →


Holy taxation!

I'm far from a Biblical scholar, but a story in Tuesday's New York Times sent me scripture searching. Even the most religiously lapsed among us knows this one (recounted in the gospels of St. Luke, chapter 20, verses 21-26, and St. Mark, chapter 12, verses 13-17), about how, as the Pharisees were trying to trip up Jesus, they delved specifically into that touchy area where church and state intersect. It's one of my favorites, since the topic of taxes is specifically addressed and is the where JC issues one of his most famous pronouncements: "Render to Caesar the things that... Read more →


Wide world of taxes

It's Columbus Day, when we in the United States commemorate Christopher Columbus' landing in the New World back in 1492. So it seems only fitting that today we look at the tax implications of working abroad. OK, it seems fitting to me, especially since the IRS just made some adjustments to a new tax law that would have cost many U.S. employees living in other countries a lot of money. First, some background. When U.S. citizens make money overseas, Uncle Sam wants a cut. Yes, when you move abroad, the IRS travels with you, at least figuratively. America is one... Read more →


A dance hall fit for angels

This morning, flipping through some of the cable movie channels that are part of our TV programming package but which we don't pay enough attention to, I came upon "Michael." It's a fun movie, notable mostly for the scene where John Travolta dances to Aretha's "Chain of Fools." But today I stopped the remote flicking not just because I enjoyed the movie, but also because Travolta's "Michael" moves (both dancing and the ensuing fight) were filmed at nearby Gruene Hall, AKA the oldest dance hall in Texas. As fate would have it, I got in on the movie right at... Read more →


How high can it go?

That's what investors have been asking about the stock market. Although it gave back a little Friday, last week the Dow Jones industrial average hit a record closing high and an all-time intraday high for three days in a row. The reasons for the rally: A drop in oil prices and the belief that the Federal Reserve will continue to hold off on raising rates, at least for the near term. So what now? How long can the upward trend continue? Should I cash out now or strap in for a long stock roller coaster ride? Unfortunately, there's no one... Read more →


Gearhead alert!

October's first Carnival of Cars, courtesy of our regular host Mark at Tapscotts Behind the Wheel, heralds the fall season with the latest automotive bloggings. Fans of classic cabs must check out the Carnival's first item on the possible production location change for London Taxis. Folks who want to do their own driving and are looking for used wheels need to check out the articles from The Garage and Carsopia with tips on buying preowned autos. If you buy a used auto down here in Texas, they you need to check out my item on the "liar's affidavit" that some... Read more →


Tax favors for gridiron green

Here in Austin, all the talk is not on tonight's gubernatorial debate (everyone knows Kinky will get in the best sound bites, if not the best political licks). No, everyone is talking about tomorrow's UT-OU football game. The annual meeting of the Longhorns and Sooners in Dallas' Cotton Bowl, ostensibly neutral territory essentially halfway between Norman and Austin, is variously referred to as the Red River Rivalry, Red River Rumble, Red River Showdown or the Red River Shootout (yeah, even we Texans hang onto those wild west clichés when they suit our purposes). When I was much younger, despite being... Read more →


Housing hurdles getting higher

This week's Festival of Frugality (noted in this earlier post) also includes my item on whether to rent or buy a house. That topic gets a new spin, thanks to Census Bureau stats released this week showing homeowners in every state but one spent more of their incomes on housing costs last year than they did at the start of the decade. The raw numbers: In 2005, homeowners spent nearly 21 percent of their incomes on housing; in 1999, the amount was just under 19 percent of income. "Housing costs" include mortgage payments, taxes, insurance and utilities. Analysts says housing... Read more →


Forget a New York minute

Here in Texas, we might talk a bit more slowly than our Northern neighbors, but when all's drawled and done, we don't have time to wait. My fellow Austinites and I know what we want and we want it now! Similar antsy attitudes were found in Houston and Dallas. That's the assessment of Guideline Inc., a research company that examined exactly where Americans are least likely to wait. The study was commissioned by eBay. The online auctioneer wanted to find out which areas might be prime locations for its eBay Express subsidiary, launched in April to cater to convenience-seeking buyers... Read more →


The wisdom of Tommy, update

Just saw another Tommy Lasorda MLB ad, first mentioned here. Yes, it's Wednesday afternoon and yes, I'm watching the A's vs. Twins. But I'm working, too, via laptop. Really! But my ability to multitask is not the issue. The commercial's message is. And guess what? Tommy does indeed say that all of us fans of non-playoff baseball teams need to watch the games and cheer on NY Yankees' opponents. In this latest commercial, Lasorda is trying to console a Red Sox fan, a Herculean task if there ever was one (sorry, Tracy!). And he specifically tells her: "October is the... Read more →


Reduced credits, but more cars

Sure, Toyota and Lexus hybrid buyers are now getting just half the original tax credit for their energy-conscious auto purchases. But at least they have a few more reduced-credit choices. The new tax break for fuel-efficient hybrids was created to encourage drivers to switch from fossil-fuel-only vehicles. But, as discussed in these previous posts, (note: when you click this link, this entry will show up first since it's the latest one tagged "hybrid," so scroll down for the earlier ones) the amount of credit a taxpayer can claim is reduced once a car maker sells 60,000 hybrids. In some cases,... Read more →


Tommy's right!

Tommy Lasorda, that is. I can't believe I just wrote that. As an Astros fan who had to put up with Lasorda and the Dodgers all those years they were in the 'Stros division, I developed a healthy fan dislike of the team and its former manager. But I love Major League Baseball's commercial with Lasorda urging folks to watch the playoffs even if their team didn't make it into the running for a World Series berth. Sorry. I couldn't find the ad anywhere online, so you'll just have to watch the playoffs on TV to see it. The closest... Read more →


Seriously seeking savings

That's what we all want, right? Then check out the Festival of Frugality #42, hosted this week by Tired but happy, for ways to shave a few dollars off your expenses. There's Bryan, who's counting his cold, hard cash and offering tips on how you can start growing your own stacks of money. And Super Saver's discussion of using other people's money to save. Even being too informed can be costly, as evidenced by J.D.'s excessive magazine subscriptions. Those are just a few of the offerings. Check out the full Festival for many more thrifty tips. Read more →


No more home-loan income fudging

If you've ever exaggerated your income on a loan application, fugeddaboutit now, especially when that borrowed money is for a mortgage. Not only will the bank be checking your income against what you report to the IRS, under a new program that began today, lenders will be getting your income verifcation info from Uncle Sam much more quickly. The Income Verification Express Service (IVES) provides two-business-day processing and electronic delivery of individual tax return transcripts. These are delivered via the Form 4506-T, Request for Transcript of Tax Return, you might have signed if you were unable to provide the lender... Read more →


Tax Carnival #5: TaxtoberFest!

Oom-pah-pah, oom-pah-pah! It's Oktoberfest time! Texas, and particularly Central Texas, has a strong German tradition: New Braunfels, Gruene, Fredericksburg, Schlitterbahn, the German-Texan Heritage Society in Austin, Shiner Bock. So it's only natural to celebrate the arrival of October and Tax Carnival #5 with our own TaxtoberFest! Willkommen, y'all. Let's get this tax party started. While fine German brewmaster skills make beer the beverage of choice at most Oktoberfest celebrations, we start our TaxtoberFest with a report from Joe at Roth & Company. In Hey, Buddy! Farmers market isn't until Saturday!, we learn of a guy who apparently prefers to get... Read more →


New 'liar's affidavit' aimed at auto sellers

No, I'm not talking about the oft-maligned used-car salesmen. I'm talking about you, me and the guy down the street when we buy our cars from each other instead of a dealership. According to state officials, person-to-person deals account for around one-third of used-car sales in the Lone Star State. A new Texas law that takes effect today, Oct. 1, is designed to stop the shorting of tax collection on autos sold via such private transactions. You've seen the classified ads: "For sale. 2000 Chevy Cavalier. Great condition (recently tuned up). Low mileage. A steal at $4,000." When the used-Chevy... Read more →


Taking care of business

When I was a writer and editor at Bankrate.com, one of my areas of responsibility was small business. I quickly learned that a good resource, both for businesses and journalists covering business issues, is the National Federation of Independent Business. Now that I run my own small business, NFIB is doubly valuable to me. Not only do I reference its Web site when I need guidance in my own efforts to make my editorial services company successful, I also write articles for the organization's Web site. Here are links to my stories in NFIB's Tools & Tips section: Tax Breaks... Read more →