Don't Mess With Taxes

I know a lot of parents are looking forward to getting some extra rebate cash based on little Jimmy or Janie. So I wanted to make sure everyone's aware of the age limit here. Yes, it's unfair that you can't get the $300 per child bonus rebate for your older, but still dependent (in many ways) college kid. But c'est la taxes. To qualify for the extra rebate money, the child must meet the child tax credit requirements. The key factor for rebate purposes is the age limit: the child must be younger than 17. And he or she must... Read more →

A few years ago, a friend of mine, along with her husband their daughter, decided to decamp to Italy for a while. It was purely a temporary stay; they had no intentions of becoming expatriates and, in fact, are now happily re-ensconced in their upper Midwest home. But during that European break, my friend delivered her son, George. I remember that fact because of the note she sent announcing the newest member of her family: "He'll probably never forgive me for having him here and ruining his shot at the presidency." Did I mention that my friend and I had... Read more →

Ask for tax information and you shall receive. In this case, it's info on state taxation of the federal stimulus package checks that will be issued beginning in May. As noted in yesterday's blog item, folks who live in states that collect income taxes are starting to wonder if this IRS rebate bonus will be a state tax boondoggle. So far we know the federal tax cash is taxable in Alabama, but not in New York. Today, we get good news for Oregon residents. That state's tax officials have announced that the federal rebate is not taxable by the Beaver... Read more →

One of the questions that keeps coming up about the stimulus package checks, commonly referred to as rebates, is, "Will I owe taxes on my rebate money?" I am happy to report that the stimulus checks will not count as taxable federal income. The IRS says so in this section (fourth "other" Q&A) of its FAQs page. So you won't have to worry about reporting your $300 or $600 or $1,200 or more as income on your 2008 Form 1040. But when it comes to state taxes, the answer is "maybe." As I've talked about before, both in this Don't... Read more →

For those of you lucky enough to have already cast your primary ballots, please excuse me while I take another brief foray into politics and taxes. The issue is on my mind of late, since here in Texas our primary is just a week away. And even if I tried to forget, I couldn't. For the last few days every phone call has been someone wanting our votes. So until the day after the polls close, all our calls are going straight to voice mail. I'm sure many fellow Texans (and Ohioans) can sympathize. Such politicking is bad enough under... Read more →

This week Broke Grad Student takes us back to school with the 141st Carnival of Personal Finance. With her creative curriculum, this College Years Edition offers us the blog version of a financial MBA. Among my favorite lessons: Feminist Finance's upcoming nuptials got her thinking about just how a Wedding As Status Symbol came about. The simple nickel's analysis of shopping at a discount store in Does Your Costco Card Really Save You Money? Wise Bread's list of Six Horrible Financial Products You Should Avoid. The Financial Blogger's conclusion that too many of us falling into The Trap Of Working... Read more →

Who would have thought that such a little country could generate so much tax interest and financial intrigue? I don't want to run this Liechtenstein tax evasion story (blogged here and here) into the ground since it doesn't directly affect most of us. But anytime folks are able to questionably shelter their income from taxation, then we all end up eventually paying. So I feel compelled to note that, according to the Times of London, British tax authorities, like German investigators, have paid £100,000 (that's $196,576 in weak U.S. dollars) for information on about 100 accounts held at LGT Group... Read more →

Are you ready for tonight's Academy Awards ceremony? I am. I love movies and I love the Oscars. I credit, or blame when my personal picks don't win or aren't even nominated, my mother. She instilled a great love of film in me and one of my fondest childhood memories was how excited she was by Gregory Peck's best actor win for "To Kill a Mockingbird." A couple of years ago I convinced my then-employer, Bankrate, that there is a legitimate connection between film and finances. I'm not just talking about the millions it takes nowadays to make a movie... Read more →

Nicolas Cage, the Oscar-winning actor most recently recognized for his "National Treasure" action movies featuring federal institutions, is now battling a real government agency: the IRS. Tax officials contend that Cage used a company he owns to wrongly write off $3.3 million in personal expenses. In response, Cage has filed a Tax Court petition contesting the IRS judgment. At issue is $814,000 the IRS says Cage owes personally and $988,000 the feds say is owed by his Saturn Productions. Then, as always, there are the additional interest and penalty charges for the tax period in dispute, 2002 through 2004. The... Read more →

I was a good daughter this week. OK, I like to think I'm a good daughter every week, except for maybe those few days after Christmas when everybody's had just about enough family togetherness. But I made up for that bit of grumpiness this week when I helped my mom stake her claim to an economic stimulus rebate check. As I mentioned in an earlier post previewing the rebates (here), my mother usually doesn't have to file a tax return since she's one of a dwindling breed: retirees who rely almost entirely on Social Security benefits. But, as I also... Read more →

The fallout from the Wesley Snipes trail continues. But this time the actor is not the target. Rather, says the Justice Department, it is planning to go after individuals who might have been emboldened by the split verdict in the "Blade" star's tax evasion trial (blogged here). Specifically, the feds want to stop tax protesters. These are the folks, also often called tax deniers, who claim a constitutional right to avoid paying federal taxes. Treasury and Justice Department officials say the protester ranks are growing and now include white-collar professionals. And they are costing the government millions of dollars. "Too... Read more →

The Northern California community of Vallejo is on the verge of bankruptcy. If it does indeed happen, it will be the first city in the Golden State to go over the fiscal precipice. (Orange County went bankrupt in 1994.) The bad news was announced yesterday by City Council members, who said Vallejo may run out of cash as early as March. A town meeting is scheduled for tomorrow evening. The major problem is with city employee contracts. According to news reports, Vallejo Finance Director Rob Stout projected that without deep cuts, including assumed agreements negotiated with police and fire departments,... Read more →

Back off! That's the word from Liechtenstein's Crown Prince Alois. The tiny nation, said its ruler, would take legal steps to preserve its tradition of banking secrecy and protect clients from German officials. The larger European nation last week ramped up its investigation into suspected tax evasion (blogged here) by many wealthy Germans believed to be hiding money in the neighboring Alpine tax haven. The prince also tried to redirect attention, according to this story in today's New York Times, by pointing out that most of the German evidence in the tax evasion investigation came from an unnamed, and paid,... Read more →

Here's some news to warm the hearts of tax procrastinators: You can file your tax return too soon. I'm not talking about people who jumped the gun on the AMT-delayed forms, or those with forgiven mortgage debt who now are twiddling their thumbs until March 3 when they can e-file. I'm talking about those obsessive folks who routinely have their returns ready to go on Jan. 2. That's not always wise. Sure, you want your refund money ASAP. But, according to a story in U.S. News & World Report, early filing can sometimes be costly. Take the case of investors.... Read more →

A major tax scandal is playing out in Germany, with the New York Times reporting that "prosecutors there are investigating hundreds of people, including several who are household names, on suspicion that they evaded taxes by steering money to Liechtenstein, a postage-stamp principality known for its striking Alpine scenery and discreet banks." Postage-stamp might be a bit generous in discussing Liechtenstein's size. It's located at the top of the arrow (there's a minuscule red dot there, too, that you might be able to see if, like me, you put on your reading glasses) in the map to the right. Click... Read more →

I hope you're having a nice day off this Presidents' Day. Today is the perfect time, between hitting all the sales, to take a look at just what the presidential candidates say they'll do to our taxes if we let them move into 1600 Pennsylvania Avenue. So when you have to take a shopping break to let your credit card cool down, check out these Web sites that offer info on just where Clinton, McCain and Obama stand. Don't read anything into that list order; we're going alphabetical to avoid any charges of favoritism! The Tax Foundation offers a nifty... Read more →

Sunday is my regular shopping day and it took a bit longer than usual, thanks to the guy in front of me at the checkout lane. No, he didn't have an overstuffed shopping cart. He wanted paper bags. My local H.E.B. had them, but it took a couple of minutes to find them at a neighboring checkout station. And it took the bagger, who was obviously more accustomed to tossing things in plastic, a bit longer to get them open and fill them. I didn't mind the extra few minutes. It's Sunday and I had nowhere to go but home... Read more →

The craziness that is tax-filing season 2008 continues with yet another deadline. Mark March 3 on your calendar. That date will be important to some taxpayers able to take advantage of the Mortgage Forgiveness Debt Relief Act of 2007. That's the new law that allows certain homeowners to exclude debt forgiven on their principal residence in cases of loan renegotiation or foreclosure. Details on the law can be found in this story (the #1 new tax statute of 2007), as well as in this previous blog entry, Tax relief for homeowners struggling to pay PI and PMI. The bottom line... Read more →

All this talk about the tax rebates coming this summer (blogged most recently here, here and here) is understandable. But to get that money, you first have to file your 2007 return. And if you're going to get a refund based on that filing, that initial IRS check of the year is of paramount concern. The standard estimate is four to six weeks for a mailed, paper refund check. But if you have your money directly deposited, it cuts that by half or more. The IRS, in its continuing effort to turn us all into electronic taxpayers, entices us by... Read more →

Diamonds might be some girls' best friends, but for us fiscally minded femmes, we want our true love to put a pragmatic spin on our Valentine's Day gift. So here are some tax-related presents that might get your sweetie's heart pumping a bit faster on this most romantic of holidays. And remember, they're not restricted to guy-to-gal giving. Women who keep an eye on their relationship's cash, and there are a lot of us, can give them to our favorite fellas, too. Take over tax chores: Yes, this year, you be in charge of this necessary but time-consuming task. From... Read more →