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December 2011

Tax loss harvesting season

Sure it's the season to be jolly, but that's sometimes hard when your portfolio has taken a beating. But you might be a bit more joyful when you file your tax return next year if you take advantage of those tax losses by the end of the year. By selling stocks or other capital assets that have lost value, you can use those amounts to offset any capital gains you might have made this tax year on more successful ventures. And taking advantage of tax loss harvesting is today's Weekly Tax Tip. But, you say, when you followed year-end investment... Read more →


I promise, I'm going to let this payroll tax rate cut extension lunacy go. But please indulge me in a few more thoughts about what has happened, or not happened, in Congress' latest lame attempt to do something that most of its members and most Americans say they want. What's next? If everyone holds firm to their current positions, the payroll tax rate reduction will die on Dec. 31. On Jan. 1, 2012, employers will once again start taking 6.2 percent, instead of this year's 4.2 percent, from workers' paychecks to cover Social Security taxes. Seniors on Medicare who want... Read more →


7 Republican payroll tax defectors

I wanted to get the previous post on today's House payroll tax vote up quickly (and then I went to lunch), but I finally got around to going through the voting list and here are the seven Republicans who voted against the House GOP payroll tax-conference committee bill: Charlie Bass of New Hampshire, Jeff Flake of Arizona, Jaime Herrera Beutler of Washington, Chris Gibson of New York, Walter Jones of North Carolina, Tim Johnson of Illinois and Frank Wolf of Virginia. I suspect that House Speaker John Boehner has already erased their names from his Christmas card list. You also... Read more →


The House, along a mostly party-line 229-to-193 vote, agreed to a conference committee with the Senate to work on how to extend the payroll tax rate cut and other laws that expire on Dec. 31. Good luck with that. The House Republican leadership refused to let the full body vote on the Senate bill, using procedural methods to instead to put only the question of a conference committee for the dueling bills to the members. After that vote, the House Democratic leadership reportedly will not appoint conferees. Even if a full bipartisan slate of Representatives is named to meet with... Read more →


The House is debating extension of the payroll tax cut. We can argue that it's about policy. We can argue it's about process. But there's no argument that it's about politics. Both Republicans and Democrats in Congress, looking at public opinion polls that rate them as the worst lawmakers ever, are looking for any edge. The House GOP is arguing that it's irresponsible to OK a short-term bill. Point taken. But how many of these Representatives have voted for the innumerable short-term -- and retroactively enacted -- bills that were just as inconvenient and uncertain? Is this the time or... Read more →


Today is a special day for fans of Tiny Tim, Bob Cratchit, the various Christmas ghosts and Scrooge, both before and after his holiday epiphany. On Dec. 19, 1843, Charles Dickens' "A Christmas Carol" was published. Although this magical, wonderful tale of humanity and the holidays is among the most well-known of books, it only saw the light of day thanks to Dickens' personal persistence. And the way it was published was as prophetic as some of the ghostly tales it contains. Because Dickens was feuding with his publishers, says David Perdue at his website CharlesDickensPage.com, the author financed the... Read more →


Year-end tax moves for small businesses

A couple of weeks ago, I posted some moves to make regarding your taxes, investments, retirement, gifting and general financial details by Dec. 31. I soon heard from readers asking for some moves to consider this month in connection with their small businesses. I'm glad all y'all asked! Since I focus on individual, not business taxes, I asked for some year-end suggestions from more businesses-oriented folks. Small Business Tax Strategies recommends that business owners: Stock your shelves. If you buy everyday supplies for your business during the last shopping week of the year you can deduct the expenses on your... Read more →


Remember that game of political chicken I mentioned a couple of days ago? That was when funding for Uncle Sam's operations was tied to extending the payroll tax cut. Well, Congress went ahead and worked that deal out and federal offices are still open. But it looks like Congress just can't stand for things to go smoothly. The Senate on Saturday handily approved a two-month extension of the current 4.2 percent reduced payroll tax rate. Obama has indicated he's willing to sign the bill, even though it contains Keystone XL pipeline provisions he didn't want. Now, however, it looks like... Read more →


As film fans know, the Golden Globes often offer a preview of the soon-to-follow Academy Awards. There's some doubt about just what we might glean from the Hollywood Foreign Press Association's 2012 nominees, but it's still fun each year to see what movies (and television series) this group finds worthy of recognition. Everyone loves George: George Clooney, who does a lot of global philanthropy and has a home on Lake Como, Italy, is a favorite of the Golden Globes crowd. That's apparent once again in the 2012 nominations. Clooney's "The Ides of March" scored a Best Picture (Drama) nomination, as... Read more →


The end of 2011 is upon us. So it's time for some December traditions: expiring tax breaks and frustration with Congress. Both of these issues were topics last week at my other tax blog. The opportunity for older traditional IRA owners to roll those account distributions directly to a charity is a popular, albeit limited, tax break. But this IRA-to-charity rollover option expires on Dec. 31 and is not likely to be renewed. So if you can use it, act soon. The way Congress has been dealing with another expiring tax break, the payroll tax rate reduction, contributed to the... Read more →


Well, they've done it again. The Senate this morning followed through on its threat -- I can't bring myself to refer to anything that either body of this Congress says or does as a promise; that's just way too positive a term for how lawmakers now minimally conduct their business -- and extended the 4.2 percent payroll tax rate for two months. AND SENATORS The vote was 89-to-10 to keep the payroll tax at its current reduced rate through February. The deal also contains a provision, known as the "doc fix," that sets reimbursement rates for Medicare providers, as well... Read more →


Drywall imported from China was used in the construction and repair of thousands of homes over the last decade. Now homeowners who say that building material was defective will get some relief from the manufacturer. Knauf Plasterboard imported drywall from China from 2004 to 2007 for use in the housing boom and hurricane repairs, particularly following the destructive 2004 Atlantic storm season. But for many, the cure was worse than the disease. The faulty foreign drywall emitted sulfur gas, which corrodes copper and other metal surfaces and caused damages in electrical wiring, copper plumbing and air conditioners and other appliances... Read more →


It seems that members of Congress are Loverboy fans. When it comes to getting their work done, they've decided to work for the weekend and do just enough right now so as not to ruin their Saturday and Sunday. Word from Washington, D.C., is that the House will pass a one-week continuing resolution to keep the government open Friday, along with a $1 trillion nine-bill spending omnibus bill. Meanwhile, over on the Senate side, Majority Leader Harry Reid (D-Nev.) and Republican leaders reportedly are about $90 billion apart on a deal to extend the payroll tax holiday. To give themselves... Read more →


Congress, facing an angry public, now working on payroll tax compromise

Today Republicans and Democrats decided to stop sniping at each other and appear to be working on a compromise to extend the payroll tax cut (among other things) and keep the federal government running. Perhaps they took to heart the Pew Research Center's recent poll that found voters are fed up with a do-nothing Congress. In fact, the poll respondents are so irked that two-thirds want to kick the Congressional bums out of office. Whatever the reason, it now appears that there might be some hope for a payroll tax cut and government funding compromise. We shall see, and soon.... Read more →


While Congress is gridlocked -- and possibly heading toward another government shutdown -- over how to keep the 4.2 percent payroll tax rate in place, lawmakers might want to spend some of their free time reading the latest Associated Press-GfK-Roper public opinion poll. That survey, conducted late last week, found that 58 percent of Americans want to keep getting the extra money that the payroll tax cut has provided them this year. The survey respondents answered "yes" even though the poll pointed out that the result could add to the federal deficit. So maybe politicians might want to rethink their... Read more →


Payroll tax cut fight could lead to federal government shutdown

Most of the time when members of Congress don't play well together, I try to ignore them. It happens all the time and I prefer to let the kids figure out how to settle their spats without paying too much attention to all the predictable details. (Getting an idea of why I'm not a mom?) They generally do, but it sometimes takes longer than any of us like. And too often, they have to go back and clean up their messes that have produced unintended consequences for the rest of us who were on the sidelines. That was my plan... Read more →


The economy was just starting to recover in 2010, but more people felt confident enough to bump up their charitable contributions. Total charitable contributions from individuals, corporations and foundations were an estimated $290.89 billion in 2010, according to the 2011 annual report on philanthropy by Giving USA Foundation and its research partner, the Center on Philanthropy at Indiana University. The 2010 estimate represents growth of 3.8 percent in current dollars and 2.1 percent in inflation-adjusted dollars. That uptick was good news for nonprofits, reversing the downward trends of the two previous years. Giving USA says that 2008 and 2009 saw... Read more →


Taxes as a tool of economic equality

Americans are quite proud of, among other things, the line in our Declaration of Independence about all men being created equal. For purposes of this post, we'll let slide that the Revolutionary-era authors' definition of men excluded men of color and all women. Now, for the most part, we try to hew to the equality ideal. But it's tough, especially in hard economic times. Practically and financially speaking, it's obvious that some people are more equal than others. That's the catalyst of the Occupy Wall Street and Elsewhere movement. But there is a way to promote equality, say participants in... Read more →


Draft 2011 tax return software options

I'm sure that by now all y'all have followed my first piece of year-end tax advice: Do a draft tax return. What? You haven't yet done a dry run to see what you're 2011 tax bill (or refund) might be? I'm as shocked, shocked as Capt. Renault. Well, this time your procrastination seems to have paid off. My tax-blogging colleague William Perez today previews the three major tax preparation software programs' abilities to provide you with an advance look of your 2011 taxes. "Yesterday I sat down to figure out what my taxes might look like for 2011," says William.... Read more →


Can't bring yourself to watch the Republican presidential candidates debate (with or without The Donald butting in)? No time to read all the articles on the GOP hopefuls' tax plans? Afraid their own publications and websites will just provide not-so-thinly veiled campaign propaganda? Not to worry. The Tax Foundation has compiled all the candidates' tax plans -- including proposals from a couple of guys I didn't know were running and one I didn't know at all -- and created an interactive tool that lets you compare them. Click on image to go to comparison site. And aren't you proud of... Read more →