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October 2007

September 2007

Beware latest tax refund scam

Just about a month ago, we had a tax scam alert about a phony survey, blogged about here. Now, as we approach the Oct. 15 deadline for procrastinators to get their 2006 tax returns filed, con artists are back at it. This new e-mail phishing scam is trying to get personal and financial data by imitating the IRS' "Where's My Refund?" Web page. That's the real refund page logo there at left. But criminals have created a fake Web site called "Get Your Tax Refund!" The con artists are sending e-mails that claim the IRS has calculated the recipient's "fiscal... Read more →

Dingell unveils mortgage deduction reductions

It's true. Legislation is on its way to reduce the mortgage interest tax break for owners of larger houses. The proposal, blogged about in a couple of earlier posts (here and here), is the brainchild -- although some critics argue that not enough brain power went into the idea -- of Rep. John D. Dingell. Before the Michigan Democrat makes it official, he wants to hear from you and me. Well, actually, he probably just wants to hear from those of you who live in his district or at least in the Wolverine State. But I've already let him know... Read more →

Toyota tax time reminder

Attention hybrid auto shoppers. The tax credit for fuel-efficient Toyota and Lexus vehicles expires on Sunday, Sept. 30. So if you're committed to that particular make of auto or SUV, head to the dealership before it's too late. You can find details on the alternative-fuel vehicle credit, both Toyota's vanishing one and those still available for other makes and models, in this previous blog post. Read more →

Second-home sellers to pay for foreclosure tax problems

The House Ways and Means Committee has signed off on a measure that would provide $2 billion in tax relief over the next decade for homeowners facing foreclosure-related tax bills. The Mortgage Forgiveness Debt Relief Bill of 2007 (HR 3648) would permanently remove from tax calculations any forgiven debt afforded homeowners who face foreclosure or renegotiate their mortgage with lenders. Currently, debt forgiveness is taxable income, meaning some people who lose their homes also end up owing the IRS (as blogged about here; other foreclosure tax issues discussed here and here). But under Congress' pay-go rules that require lawmakers to... Read more →

A toast to charities and alcohol taxes

I'm no teetotaler. I enjoy the occasional Dos XX. A glass of wine (red, please) is a nice accompaniment to most meals. And I'm not averse to a cocktail or two if the bar stocks Campari (I do have a thing for beverages of the crimson color). But imbibing alcoholic beverages isn't on my list of top three things to do. Apparently, I'm in the minority. It wasn't always so. In my college and just-after days, I drank a lot more. Back then it was a right of passage. The drinking age was 18 and leaving the parental abode meant... Read more →

Reading and writing and 'rithmetic

For someone who's long been out of school and has no kids in college, I know I've been focusing on education a lot. Maybe it's because last month my high school class held its 33.3 year reunion. Yeah, a math-oriented, trained engineer came up with the unusual commemoration date (I'm talking about you Mark!). Unfortunately, I couldn't make it. Another classmate sent photos (thanks Luis!), although I think he might have forwarded the wrong ones. Most of the people in the digital snapshots looked way older than me, or so I keep telling myself! Personally, I'm going to keep visualizing... Read more →

Texas real estate: Reality vs. TV

Last night we watched the return of "Heroes" on NBC and were a bit disappointed in one new plot twist. Claire Bennet, the indestructible cheerleader, and her family have moved this season from Odessa, Texas, to Southern California. Of course, that now means there won't be any topographical issues, like when the hills of Southern California showed up in exterior shots that were supposed to be of West Texas' very flat, save for the caprock between Kermit and Odessa, terrain. It also means that we probably won't be seeing Claire making the 45 mile drive to my hometown to visit... Read more →

Carnival of Money Stories

Today's going to be a full one, but I wanted to get a quick post up this a.m. before heading out to a lunch meeting. The bad thing about my meeting -- aside from the fact that everyone in the group wants to eat so early! I guess they start their days, and have their breakfasts, a few hours earlier than I do. -- is that schlepping through downtown Austin traffic to get to it is going to take almost as long as the event itself will run. The good thing about the meeting is that it features a panel... Read more →

Final tax-filing deadline fast approaching

I saw that bad IRS television want-ad again. Yes, I was up watching late-night cable programming; how else am I going to get my X-Files fix? Anyway, you remember the ad. I blogged about it back in the fall. It's the IRS' pitch for seasonal employees. It's reappearance can only mean one thing. It's tax-filing season again. Back in April, almost 10 million taxpayers requested an extension to file their 2006 returns. A good number of those folks will no doubt put off their final filing duties until the ultimate last moment, which is Oct. 15. So Uncle Sam is... Read more →

Express lane to financial embarrassment

I ran to the grocery story to pick up a few items and ended up being part of one of the most embarrassing situations you can think of. Not enough money to pay for your items. I'm happy to report that it wasn't me facing the cash shortfall. But I inadvertently shared the humiliation of another store customer. The shopping trip was supposed to be a quick, uneventful one. I headed out with a list of specials carefully selected from Randalls' weekly newspaper insert ad, along with a few coupons set to expire. I found my items quickly and spotted... Read more →

He said/she said issues with bank security

I made a couple of deposits via ATM yesterday. When I got home, I immediately logged onto my bank account to make sure they showed up. They were both there, one to our personal account and one to my business account. And I was very glad, since I definitely didn't want a repeat of my bank error not in my favor escapade. Mainly, of course, I just want my money in my accounts when I put it in there. But I also don't want the hassle factor of trying to clean up mistakes. In this age of identity theft, banks... Read more →

Are you ready for some tax-deductible football fines?

It looks like case closed on the New England Patriots' illegal videotaping of the New York Jets' defensive coaches signals in the teams' Sept. 9 season opener. The Patriots won 38-14. Pats Coach Bill Belichick was fined $500,000 and the Patriots $250,000. The team also will lose a 2008 first-round draft choice if it makes the playoffs; if it misses the playoffs, the draft costs will be its 2008 second- and third-round choices. But we still have an important matter hanging out there. Specifically, can Belichick deduct his fine on his next tax return? Paul Caron, aka TaxProf and a... Read more →

Education Costs 101: Tax-saving ways to pay for school

Kids of all ages are back in class. Now comes the fun part: Figuring out how to pay for all that book learning. Why not let a relative help? Your good ol' Uncle Sam. For the last decade, a variety of federal tax breaks have been around to help us pay for higher education for ourselves, our spouse or our dependents. The good news is that there are so many educational tax break options. The bad news is that there are so many educational tax break options. Many, but with limits: Uncle Sam is helpful, but not too helpful. He... Read more →

8 questions investors should ask themselves

With the markets soaring thanks to yesterday's federal funds rate cut, it seems a good time for some cautionary words before we all go jumping into the deep end of the investment pool. I ran across a release from the Colorado Society of CPAs with tips on managing your retirement portfolio. Since most financial gurus say your involvement with equities should be for the long haul, these eight questions should benefit us all, even for funds that aren't strictly for our post-work years. So here goes: 1. Do I have a plan in place for investing regularly? The key to... Read more →

Congress and foreclosure tax relief

OK, I just picked on the IRS for not doing its job. Now it's time for Congress to get the same treatment. Charles Grassley, the Iowa Senator who is the ranking Republican on the Senate Finance Committee, has written the Treasury Secretary asking for immediate action to alleviate the tax pressures faced by some homeowners who have lost their residences to foreclosure. Grassley's request, co-signed by Sens. Gordon Smith (R-Ore.) and Pat Roberts (R-Kan.), comes in the wake of recent media coverage of the tax implications of foreclosure (a link list is at the end of this post), as well... Read more →

Baseball bids benefit IRS

No more guessing over how much Matt Murphy owes the IRS. The bill is around $239,375. Murphy is the baseball fan who came out of the grandstand scrum in San Francisco on Aug. 7 with Barry Bonds' record- breaking 756th home run ball. As soon as Murphy took possession of the orb, the debate began (at least it did among us tax geeks) as to his possible tax liability. Was the ball a gift, as a couple of readers contemplated at my post about after Barry's blast? Or was the ball's presumptive value subject to tax even before a sale?... Read more →

Praising Pigovian taxes

I'd never heard of Arthur Pigou until today, but I must admit that my formal economics education didn't get much past supply and demand discussions. In case you're in the same economics 101 boat with me, Pigou was a British economist who called for the use of taxes to fix problems, specifically to deal with pollution in the early 20th century. Thanks to New York Times economics columnist N. Gregory Mankiw for educating us about Pigou and Pigovian taxes in today's paper. In his column, One Answer to Global Warming: A New Tax, Mankiw notes that economics textbooks now call... Read more →

Wrong IDs cost IRS billions

Why does the IRS insist on not making its employees work? First there was the debt collection issue. Instead of sending IRS agents after taxpayers who aren't paying their bills, the agency -- over much opposition and probably for not much longer -- opted to outsource the job to private collectors. Now the IRS doesn't want its folks spending time tracking down wrong tax ID numbers that show up on copies of W-2 and 1099-MISC forms that the agency receives from employers. That decision, according to a recent tax watchdog report, is costing the U.S. Treasury big bucks. An investigation... Read more →

Women, men and money

It's 2007. The 21st century. But some things haven't changed. No, I'm not talking about the fact that we don't yet have flying cars, although I'm still upset about that. I'm talking about gender and money. Now my regular readers know that I try to avoid stereotyping. Such generalized conclusions are often wrong, frequently embarrassingly and most of the time do little to further rational conversation. Sometimes, though, it can be useful to examine trends. Take the workplace, for example. Working outside the home is now no big deal for women. But in my lifetime -- and I am not... Read more →

1040ES payment #3 reminder

I'm a wife, so I know how to nag. The hubby's just glad this time, it's not him I'm "reminding." No, my target today is all my fellow taxpayers who have to make estimated tax payments. As mentioned last week, payment #3 is due Monday, Sept. 17. If you mail in the 1040ES voucher and a paper check, you can get it in the mail so that it's postmarked on that date. If, however, you were able to set up an e-payment account via EFTPS, then you probably want to sign on to your account today and get things in... Read more →