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October 2010

September 2010

Just who is rich? That's the underlying question behind the now-postponed battle over which of the expiring Bush tax cuts to extend or ditch. Under the Obama Administration plan, the 2001 and 2003 tax cuts for the middle-class (and yes, there's another definitional issue there) would be retained. But the income tax rates for the top 2.5 percent of taxpayers -- individual making more than $200,000 a year and families bringing home more than $250,000 -- would be hiked. Those folks, for the prez's tax plan purposes, are rich. In most cases, that's a safe assumption. The vast majority of... Read more →

Is there a "Money Never Sleeps" companion movie entitled "Every Day is a Tax Deadline"? Probably not. And no, not all 365 days demand tax attention. But neither can you simply think your tax tasks are over once April 15 passes. Take today, for example. Some folks -- certain home buyers and tax delinquents in some states -- have tax matters to attend to on Sept. 30 or they'll pay a price. Get the details in my Bankrate Taxes Blog post Sept. 30 tax deadlines. Related posts: Tax amnesties in D.C., Florida, Nevada and New Mexico end on Sept. 30... Read more →

No votes on tax cuts until November

It's official. We taxpayers will wait another month, or more, to find out what our income tax rates and other tax breaks will look like in 2011. The Senate surrendered first. Last week, the Senate Finance Committee chairman announced that body would not hold a vote on the expiring Bush tax cuts because most of his colleagues wanted to get the heck out of town. The House, however, looked like it might be able to muster enough courage to take a tax-cut vote before the Nov. 2 midterm elections. Apparently, that was just crazy talk. House Speaker Nancy Pelosi (D-Calif.)... Read more →

Something about tax cuts from The Onion

"Some sort of tax cut or earnings or money or something was reported in economic news this week in further evidence that a lot of financial-related things have been going on lately," reports The Onion. "America's Finest News Source" provides satiric details in Something About Tax Cuts Or Earnings Or Money Or Something In Recent Economic News, which sadly, terrifyingly, maddeningly and correctly reflects the cacophony of financial and political reports on efforts to influence the U.S. economy and voters. Related posts: Tax breaks in the new small business bill Rich get most of the tax benefits Representing the rich... Read more →

Tax amnesties in D.C., Florida, Nevada and New Mexico end on Sept. 30

If you owe past-due taxes in Florida, Nevada, New Mexico or Washington, D.C., then time is running out for you to take advantage of tax forgiveness programs in those locales. The tax amnesties in those three states and the District of Columbia end Thursday, Sept. 30. After that, the tax collectors are after you again. My Aug. 17 post has some more info on these soon-to-end tax amnesties, as well as the dates of amnesty programs in Kansas, Illinois and Maine that run a tad longer. Don't dawdle if you're eligible for a tax amnesty. Participating in one could save... Read more →

Both headline statements are true, depending on which state you're talking about. Total state and local government tax revenue increased slightly for the second quarter of 2010, showing growth across most major tax categories, according to data released Monday by the Census Bureau. But in California, the Golden State tax collector is owed $1.4 billion in sales and use taxes. That amount could really help plug some of the state's $19 billion budget gap. The unpaid California tax money is particularly troubling, reports the Los Angeles Times, since much of the tax money has already been paid by consumers but... Read more →

Tax breaks in the new small business bill

While Congress can't agree on individual tax law legislation, the House and Senate did send a small business bill to the White House. Obama signed the Small Business Jobs and Credit Act into law earlier today. Among the key tax provisions are: Extension of bonus depreciation Expanded Section 179 expensing Increased start-up costs deduction Five-year carryback for general business credits A health insurance deduction that will reduce self-employment taxes It's late, so rather than reinvent the wheel and elaborate on these and other tax provisions in the latest small business bill, I defer to folks who specialize in small business... Read more → with its Financial Infographics provides this interesting visual of state-by-state property taxes assessed owner-occupied homes. Click on the image for a larger view; once it opened in a new browser, I had to click it again to get a more easily "readable" size. How glad am I that my home state of Texas leads the nation in property taxes as a percentage of home value. Guess that sort of balances out the no-income-tax break for us Lone Star State residents who own houses. Related posts: N.J. got it right: We hate property taxes Homeowner fighting 'air' property tax Appealing... Read more →

We interrupt the continuing debate on extending the Bush tax cuts for a special non-news headline: Wealthy benefit most from tax subsidies More information is available at Reuters, Yahoo Finance, Business Insider and from the two groups that conducted the research that produced the not surprising results, the Corporation for Enterprise Development and the Annie E. Casey Foundation. You'll find highlights in the official announcement of the study and full details in the report itself, Upside Down: America's $400 Billion Federal Asset-Building Budget. We now return you to your regular tax programming. Related posts: Tax cuts back on track in... Read more →

Earlier today, nearly 100 pastors spoke to their congregations about political issues. The special sermons were part of this year's Pulpit Freedom Sunday. Like the first Pulpit Freedom Sunday in 2008, also a general election year, the ministers are defying tax laws that say tax-exempt organizations cannot support politicians and keep their tax-advantaged status. The ministers, egged on encouraged by the Scottsdale, Ariz.-based nonprofit Alliance Defense Fund, say they are just exercising their right to free speech. Yes, reverends, you, like every other American, can say pretty much what you want. But if your group is getting a tax break,... Read more →

I'm not saying Coloradoans (Coloradans?) are loony. Heck, my sister- and brother-in-law live there and I really like them. I'm just saying that Centennial State residents are definitely mad, as in enthusiastic, about tax cuts. OK, maybe they're mad, as in angry, about taxes, too. Back in February, Colorado Springs got a lot of flack attention for its decision to slash property taxes. The resulting loss of revenue meant the town also had to make some tough choices about which services would be saved and which would be cut. Come November, all Colorado voters might follow, to some degree, Colorado... Read more →

Tax cuts back on track in House

The Senate may have punted on the expiring tax cuts, but House leaders say they might take a vote on the volatile issue before that body breaks for the Nov. 2 elections. House Speaker Nancy Pelosi (D-Calif.) said yesterday that a House vote on what to do about the Bush-era tax cuts could come as soon as next week. That would force Minority Leader John Boehner (R-Ohio) to put up or shut up about voting for a bill that extends only middle-class cuts if that was all that was offered on the House floor. But it also would highlight the... Read more →

OK. The National Association of Home Builders (NAHB) delivered the message in the headline, but the trade group says that the admonition actually comes from a recent poll of likely voters. The poll conducted earlier this month found that three of the five tax deductions people strongly support are connected to homeownership. The mortgage interest write-off tops the home-related tax breaks, just a percentage point behind the itemized deduction for medical expenses. The other three deductions that polled folks want to keep are for state and local taxes (including property taxes), charitable deductions and home equity loan interest. Thanks for... Read more →

Gordon Gekko is back on movie screens today. The "Wall Street" sequel "Wall Street: Money Never Sleeps" has gotten mixed reviews. But regardless of what the critics say about the merits of the movie, anyone interested in money -- and that's most of us -- are curious as to whether in 2010 greed is still good. The 1987 original not only provided an Oscar-winning role for Michael Douglas, it also let us money gawkers see a bit, albeit theatrically enhanced, of the New York financial world. As the sequel's opening neared, The Motley Fool looked back at the impact of... Read more →

Tax cuts on hold until November

That's it. I'm done predicting Congressional action. My crystal ball obviously is broken. I really thought the House and Senate would come back to Washington and get stuff done to show the voters that they deserve to stay in office. Today, however, the Senate said "sorry" to dealing with the expiring Bush tax cuts. It's looking like this important issue will be handled by a bunch of lame ducks. According to CQ Politics, Montana Democrat and Finance Committee Chairman Max Baucus is "ready" to introduce tax legislation, but "people want to leave … by next week." Some Senators are worried... Read more →

First-time homebuyer credit's final week: Close by Sept. 30 to claim it

Did you have contract on a house in place on April 30? Do you meet the requirements to qualify for the expanded first-time homebuyer tax credit? If so and you haven't closed on your new home yet, get to prodding, pleading and generally nagging whoever it takes to get the paperwork signed, sealed and delivered by next Thursday. A week from today, Sept. 30, is when the homebuyer tax credit finally ends. As we wind up this ostensibly well-intended tax credit, data is coming in that indicates that for the most part the tax break has had a negligible effect.... Read more →

Effect of expiring tax cuts on the rich

As if on cue, no sooner had I posted my item about all the numbers crunching in connection with the Bush tax cuts than I get an e-mail from The Tax Foundation on its two reports focusing on high-income taxpayers. The nonprofit, however, takes the impending federal tax hikes to the states. Its Fiscal Fact No. 246 breaks down the "Top Marginal Effective Tax Rates by State under Rival Tax Plans from Congressional Democrats and Republicans." "If the plan supported by most Congressional Democrats becomes law, the top marginal effective tax rate would rise to above 45 percent in many... Read more →

With every day that passes, the return of higher tax rates gets closer. And you know what that means. No, not actual Congressional action, although one Senator said debate on the Bush-era tax cuts could begin as soon as tomorrow. (I'm not holding my breath.) What all this attention to the impending end of Dubya's tax cuts really means is there's been, and will continue to be, all sorts of crazy numbers crunching. Pundits on both sides of the aisle are parsing costs to the deficit, what individual taxpayers will pay and even what it will mean to states if... Read more →

You'd think that by now we'd all be prepared for the annual Congressional tax procrastination. Unfortunately, though, the timetables for getting tax documents updated is not yet as flexible as we'd like. That means that as many most years wind down, we and the IRS are on edge waiting to see what changes will be made to tax laws. When Washington finally hands down its edicts, the IRS then goes into full-court press mode to incorporate any changes. There are revisions not only the documents that we taxpayers will use in the coming filing season to complete our returns, but... Read more →

Individuals who could face higher tax rates in 2011 are not the only ones anxiously watching what Congress might do about the expiring Bush-era tax cuts. Most state tax codes are based to some degree on federal laws. Such tax code connections, usually referred to as state-federal conformity, could force state revenues up or down, reports, depending on the state and whether Congress decides to extend all of the tax cuts, just some of them or none at all. "If all of the tax cuts are extended, then states wouldn't see a change from their current fiscal footing," says... Read more →