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July 2007

Expanding e-commerce taxes?

If you're an e-shopper of a certain age, you probably remember the early days of e-commerce. It was new, it was exciting, and there were lots of items that you just couldn't find down on Main Street. Even better, in almost every instance, you didn't have to pay sales tax on your electronic purchases. That didn't last long. State revenue departments were soon demanding their portions of revenue from online sales. The determining factor was whether a company had an actual physical presence in the state. That means if you're looking for a particular scented candle and your local Yankee... Read more →

Legal fee issue leads to dismissal of tax-shelter charges

A federal judge today dismissed indictments against 13 former KPMG executives in what has been called the biggest criminal tax case in U.S. history. U.S. District Judge Lewis A. Kaplan issued his ruling (full text here, courtesy of the Wall Street Journal), saying he had no alternative but to dismiss the indictment after determining last year that prosecutors violated the former accounting firm executives' constitutional rights by putting undue pressure on KPMG not to advance them defense costs. The dismissal is not necessarily bad news for the feds. In fact, federal prosecutors had urged the judge to do just that.... Read more →

A new twist on death and taxes

When Ben Franklin uttered his famous quote about two of the most dreaded inevitabilities we face, I'm pretty sure he never envisioned them meeting up quite this way: The former director of UCLA's Willed Body Program pleaded guilty to federal tax charges after admitting he never paid taxes on tens of thousands of dollars he made while overseeing the university's program. The Orange County Register adds that Henry Reid, the university official in question, was charged with selling donated bodies that were supposed to be used for medical research to a middleman, who then resold them to other people. Prosecutors... Read more →

When love goes bad: Divorce and taxes

Being such a hopeless romantic, I recently posted on tax considerations for newlyweds. But sadly, around half of all marriages in the United States end in divorce. When that happens, on top of everything else involved, both of the soon-to-be ex-spouses need to take into consideration any potential tax implications of the split. Take, for example, alimony. Ryan Ellis of the Tax Info Blog points out that this spousal support is taxable, even if it's not deductible. And Ryan elaborates on alimony, as well as the IRS' innocent/injured spouse rules, for a woman who's dealing with a "jerk" of a... Read more →

Summer tax phishing season

Wow! I am so lucky! I just got "good news" in my e-mail box from an IRS "Tax Refund Specialist" that the agency's "annual calculation" has revealed that I'm eligible for a refund of more than 90 bucks! I am so excited about this unexpected windfall that I want to share the complete message with you: Good News, After the last annual calculation of your fiscal activity we have determined that you are eligible to receive a tax refund of $93.82. Please submit the tax refund request and allow us 2-4 days in order to process it. A refund can... Read more →

Congratulations to I and the Bird

I and the Bird, the wonderful biweekly collection of the best that the many birding blogs have to offer, is celebrating its second anniversary. Congratulations to Mike and my fellow avian aficionados who've made this birding carnival such a success. Unfortunately, the hubby and I have been too busy, and it's getting a bit too hot here in Central Texas, to do much birding. Plus, we had that horrible rainy spell. So I don't have an entry in this momentous edition. But I am very thankful that through it, I can cyberbird. The hubby and I also are grateful that... Read more →

Money superstitions
for Friday the 13th

Happy Friday the 13th! Most of us are superstitious at least a little. But I'm not paraskevidekatriaphobic, so today isn't a big deal for me. In fact, I didn't realize today was what some folks consider an ominous day until I unfolded my newspaper. But now that I've figured out what day it is (a challenge sometimes!), I'm running with the theme! Here are some fun money superstitions. An itchy palm means money is coming your way. I've heard this all my life. Unfortunately, my personal experience doesn't lead me to believe this is true. "Lucky penny, pick it up.... Read more →

GOP says tax cuts are helping shrink federal deficit

OK, I pick on Dubya and his buddies. A lot. And I'm not going to stop, in large part because I have major reservations about many of this Administration's tax policies. But, as a journalist, I feel duty bound to report the latest deficit reduction news. The U.S. budget deficit will narrow to $205 billion this year, the lowest since 2002, according to the White House. The reason, Administration officials say, is rising tax revenue. The prez and his fellow Republicans credit some $2 trillion in tax reductions over the last 6½ years with fueling economic growth that has produced... Read more →

Thank you and goodbye,
Lady Bird Johnson

Another fine Texas woman is no longer with us. But her legacy -- a love of and dedication to protecting our natural resources and beauty -- remains. Thank you Mrs. Johnson. Every bluebonnet in Texas and wildflower across the rest of the country will forever remind us of how much you meant to us. Austin's local NBC affiliate, KXAN, has a nice tribute to Mrs. Johnson. If you want to help continue the First Lady's environmental efforts, donate to the Lady Bird Johnson Wildflower Center. Read more →

The private tax collection party is over ... maybe

Private debt collectors who, since last September have been bringing in delinquent taxes under IRS contract, were celebrating a couple of weeks ago. The party hats were donned and high fives struck after the House approved -- well, technically, it didn't disapprove -- funds for the continued hiring of private collection agents, known as PCAs in IRS parlance. But over on the Senate side of Capitol Hill, the PCA roller coaster is definitely heading down. Yesterday, the Financial Services and General Government Subcommittee of the Senate Appropriations Committee signed off on an $11.1 billion fiscal 2008 IRS budget. However, that... Read more →

Vacation home tax breaks

When one of our air conditioning units died last month, I got to thinking about how nice it would be to have a summer vacation home in the cool mountains. I'm not talking about a mega-bucks chalet like the rich and famous have at Sundance or Aspen. A nice little place in Ruidoso, N.M., is fine by me. When I was a kid, my family used to occasionally take a vacation break there to escape the summer heat. One of my dad's coworkers had a cabin and we got to use it. It wasn't really a cabin in the rustic... Read more →

Protecting polydactyl cats

I used to work with a woman who, like the hubby and me, was a fan of felines. Every tax-filing season Tracy would reiterate her dismay that she couldn't claim her cats as dependents on her 1040. I certainly sympathize and empathize with Tracy's point of view. But, tax laws notwithstanding, any cat person will tell you that dependent isn't a word typically associated with these headstrong animals. Neither can they be classified as "exhibits," at least not the six-toed variety that live in Ernest Hemingway's former home in Key West. Officials of this funky town at the farthest reaches... Read more →

Tax policy vs. medical coverage for kids

A couple of weeks ago, I blogged about the possibility that the White House might consider a credit instead of a deduction when it comes to tax breaks for individual health insurance coverage. That discussion came up as an ancillary issue to the main medical topic of that day, the State Children’s Health Insurance Program (S-CHIP). Now the S-CHIP is again taking center stage, as Congressional Democrats are proposing a substantial increase in federal spending for the state administered program so that its services can be expanded to more lower-income children. And once again, the White House is digging in... Read more →

Taxable mental anguish

Last August, a D.C. federal appellate panel ruled that the IRS cannot collect taxes on money awarded as compensation for emotional distress and other intangible injuries. In the original ruling, Marritta Murphy was awarded damages for emotional distress and loss of reputation after she blew the whistle in 1994 on environmental hazards at a New York Air National Guard base. The three-member D.C. appellate panel said Murphy should get a tax refund of $20,665, plus interest, on her $70,000 judgment from the Department of Labor Administrative Review Board because it was "compensation for the loss of a personal attribute," not... Read more →

Calling it quits

Two people I know recently up and quit their jobs. They weren't moving to another employer (although one of them has since found a new position). When they gave their notice, they had just decided that 9-to-5 at their workplaces was no longer for them. As someone who did the very same thing just over two years ago, I say "Good for you and welcome to the club!" It's a hard step to take. But sometimes it's the only one. I'm still hearing from folks about the departures. In cases like these, the coworkers left behind tend to be shocked.... Read more →

Not so innocent, tax or otherwise, TV wives

I try to avoid gender stereotyping, mainly because many of the attributes traditionally assigned to women are not applicable to me. I love most sports. I hate shopping, except for groceries. I'd rather wander the aisles of a Lowe's or Home Depot than any high-fashion mall. I long ago gave up routinely applying makeup; the choice gives me an extra half hour of sleep in the mornings. On the distaff side, I know that all men aren't pigs. In fact, I have as many male friends as female ones. That's why I was so distressed by the creation of the... Read more →

Tax to-do's after saying 'I do'

Thousands of superstitious couples will walk down the aisle today, Saturday, July 7, 2007, hoping that the triple seven date will bring them some added marital luck. And although he wasn't invited to any of these 7/7/07 ceremonies, Uncle Sam has a vested interest in your marriage. Bob D. Scharin, RIA Senior Tax Analyst from Thomson Tax & Accounting, advises newlyweds to make sure they are aware of how their new married status can affect many tax and financial decisions. "This will help guide you to smart choices that will have the best possible effect on your bottom line next... Read more →

Free File tax foul-ups and free fall

You use tax software, in part, because you want to make sure your returns are done correctly, right? Well, it seems that, at least in the case of some folks who use the IRS' free tax filing program, that's not happening. A June 28 report from the Treasury Inspector General for Tax Administration (TIGTA) has the alarming news that Free File Alliance software does not always compute taxes correctly. Oh, the software does fine in calculating the entries on the return. But whether those entries should be there in the first place is TIGTA's concern. Basically, some of the software... Read more →

The tax also rises

So you thought Ernest Hemingway's works were inspired by tumultuous relationships, his lifelong battle with depression or excessive drink? You're right, to a point. But according to the the May issue of The Hemingway Review, another one of Papa's muses was taxes. According to the publication's abstract, "Taxes played a surprisingly prominent role in the life of Ernest Hemingway — so much so that he personally dealt with, or wrote about, most of the major tax concepts embodied in the Internal Revenue Code. "This article notes Hemingway's written observations about such tax matters, including remarks about the state of his... Read more →

Virginia's speeding tax could be very costly

Virginia drivers, beware. If you ignore the state's speed limit signs you could end up owing a $3,550 ticket. That stunning amount comes courtesy of a new law that incorporates a multi-year traffic tax, part of the Old Dominion's "driver responsibility" law aimed at repeat offenders. Under the law, which took effect July 1, traffic offenses ranging from expired licenses to speeding to driving under the influence will get violators not only a fine and points (that could carry immediate costs as well as increased insurance rates), but also a $350 tax. Even costlier, the tax -- officially known as... Read more →