Previous month:
November 2012
Next month:
January 2013

December 2012

Assume crash positions, people. We are going over the fiscal cliff. The Senate is still working on a proposal to deal with the expiring/expired tax provisions that are part of the fiscal cliff. The House, however, has called it a day. Regardless of what the Senate might do later today, the House will vote on it tomorrow at the earliest. So technically, we're all part of the Wyle E. Coyote cartoon family, dropping helplessly into a financial canyon. Cliff jump courtesy Realistically speaking, it won't matter that much if the final tax deal is done at 11:59 p.m. tonight... Read more →

Is your email box as flooded as mine today with pleas for money from charities? Those nonprofits know that today is the last day that we can donate if we want to claim the gift as an itemized charitable deduction on our 2012 tax return. Even the youngest have the giving spirit. Photo courtesy Bart Everson via Flickr Creative Commons. This could be particularly important to higher income folks if we go off the fiscal cliff and prior tax laws returns. In that case, the limitation on all Schedule A deductions, including gifts to your favorite charity, could be limited.... Read more →

Senate ready for some football; adjourns Sunday without reaching fiscal cliff deal

OK, I was mostly joking when I said earlier today that fiscal cliff talks would not impinge on viewing of or attendance at tonight's Cowboys vs. Redskins NFL game in suburban Washington, D.C. Well ... The Hill newspaper reports that the Senate, whose leaders have taken over the negotiations, left just before 7:30 p.m Eastern time. That gave lawmakers and their staffers plenty of time to make it to their box seats at FedEx Field in Landover, Md., -- I know, as the hubby and I used to commute from our Capitol Hill jobs to our Prince George's County home... Read more →

Talks reportedly are continuing on Capitol Hill this Sunday, Dec. 30, as lawmakers struggle to find a way keep us from falling off the fiscal cliff in less than 48 hours. Today, however, there is a firm deadline for the talk participants to take a break, if not conclude. It's 8:20 p.m. Eastern, 7:20 p.m. Central. That's kickoff time at FedEx Field in Landover, Md., for the Dallas Cowboys and Washington Redskins game. Political pundits put the chance of a fiscal cliff deal being reached before Jan. 1, 2013, at 50-50. That's almost the same as the computer simulation predictions... Read more →

As you're getting your 2013 tax filing material together (you are doing that now, aren't you?) take a good look at your final W-2 of 2012. It's the last time you'll see that small of a FICA withholding amount. Since January 2011, the amount of FICA, sometimes indicated as Social Security tax on pay stubs, taken out of workers' paychecks has been 4.2 percent. That will change on Jan. 1, 2013. Next year the 6.2 percent withholding rate returns. The tax cut holiday always was meant to be temporary, a short-term stimulus measure to keep folks spending during the recession.... Read more →

I never was a big fan of either version of "Beverly Hills 90210." You remember the original show about the trials, tribulations, machinations and melodrama of a group of fictional rich Southern California high schoolers. Or maybe you now watch the updated version now on the air. It that's your cup of TV tea, that's fine. I'm not here to judge, just to note that I preferred then and now the trials, tribulations, machinations and melodrama of a real life government institution that too often seems like a group of rich Washington, D.C., high schoolers. Yeah, I'm talking about Congress.... Read more →

Don't get too excited, but there appears to be some optimism that a fiscal cliff deal might be near in advance of a mid-afternoon White House meeting with Senate and House leaders. I'm not going to get into blow-by-blow reporting of the negotiations, but it seems that as is too often the case in Washington, D.C., lawmakers might be coming to terms -- and their senses -- on a last-minute deal to stave off the implications of the Jan. 1, 2013, fiscal cliff deadline. OK, picky calendar watchers, the real effective date is Jan. 2, since that's the first business... Read more →

It's always darkest before dawn. Personally, I think it's the darkest when it's dark. Dawn in central Iowa by Carl Wycoff via Flickr Creative Commons And things are pretty dark in Washington, D.C., right now when it comes to a fiscal cliff solution. I'm not alone in my pessimism. A Gallup Poll conducted just days before Christmas found that Americans' optimism that a budget agreement will be reached before Jan. 1 has waned. Half of the poll respondents now believe a fiscal cliff solution is near, with 48 percent doubtful. That's a drop from the previous three weeks, when the... Read more →

With the Mayan end of world threat over, it's time to focus on the fiscal cliff

Welcome back from your holiday festivities. I hope you got everything you asked of Santa. Not to run the Jan. 1, 2013, deadline into the ground, but since we avoided the Mayan end of days, the possible coming U.S. financial calamity has totally taken center stage. So now we get to wait to see if there will be a post-Christmas miracle in the form of a fiscal cliff deal. Senators and the President are expected back in their offices on Thursday, Dec. 27. Representatives are awaiting word to return to Capitol Hill. Right now it's looking more and more likely... Read more →

Merry Christmas! I hope you got everything you wanted this year. For most of us of a certain age, the items under our trees are not the most important gifts of the holiday season. But it's still fun to have a package or two to open. And it's also fun, and financially interesting, to look at what it would cost for a true love to give all the gifts enumerated in the traditional "Twelve Days of Christmas" song. Christmas' increasing costs: This is the 29th year that PNC Wealth Management analysts have crunched numbers to find out how much all... Read more →

Sure the Pope gets a lot of attention thanks to the annual Christmas services at the Holy See. But just as important to some is the world's smallest sovereign state's duty-free shopping opportunity. The Vatican's St. Peter's Basilica, courtesy Wikimedia Commons The Associated Press reports that The Vatican's duty-free department store offers bargains on flat-screen televisions, a variety of Samsonite luggage, custom shoes, luxury watches and a variety of other high-end items. Got a golfer on your list? Then there's a leather-bound travel trunk from Florence's "The Bridge" leather works that comes with a matching leather golf club bag. I'm... Read more →

Not to be a Grinch on the eve of Christmas Eve, but while we wait for the fiscal cliff to be resolved, it's worth a look at what tax bills could be in 2013. While Obama is an admitted "hopeless optimist" who believes a tax and spending deal can be reached by Dec. 31, I'm not so sure. Yeah, I know that less than two weeks ago I professed a tiny bit of faith that a deal would be struck before Dec. 31. But even then I qualified that prediction by saying I didn't expect any agreement to be reached... Read more →

With Christmas just around the corner I was in a giving mood last week at my other tax blog, so there was an extra post. Actually, it was Republican Representatives who were my trusty topic elves -- I can see those guys with pointy ears and green tights -- and provided me with the extra blog fodder. House Speaker John Boehner (R-Ohio) came up with Plan B that he hoped his fellow Republicans would support as a way to move us away from the financial chaos scheduled to hit on Jan. 1, 2013. Unfortunately for the Speaker, dissension in GOP... Read more →

When Congress and the President return to Washington, D.C., Obama wants lawmakers to consider a stripped-down measure -- dare we call it Plan C? -- that he says will keep taxes at their current rates for all but the wealthiest Americans. While it will definitely be welcome by most taxpayers, it is far from the grand bargain that Obama and House Speaker John Boehner, who saw his own Plan B fiscal cliff proposal killed by the insistent anti-tax faction in his own party, tried to reach in 2011. As envisioned, such an agreement would be a political tax and spending... Read more →

If you itemize your deductions and you're like me, you will spend the waning days of the year looking over expenses and seeing how much more you need to spend. Wait, you say. You are spending more at the time of year when budgets are already stretched thanks to all the presents on your list? Yes, I am. And it might be a good idea for you too. That's the ninth Reindeer Year-end Tax Games Tip of 2012 from Rudolph, Santa's glowing team leader. As the one who's head of the sleigh bunch, Rudolph says bunch your expenses. Vintage Rudolph... Read more →

OK, it's an easy joke, but you knew it was coming. It's also quite possible that Dec. 20, 2012, marks the beginning of the end of Rep. John Boehner as Speaker of the House of Representatives. Last night, Boehner was unable to quell the rebellion among GOP conservatives and abandoned his alternative tax plan, deciding to not put it to a vote. The so-called Plan B would have increased taxes on millionaires but permanently installed the lower Bush-era tax rates (and other provisions) for other taxpayers. The Ohio Republican has had a tough time marshaling his troops after the 2010... Read more →

Where has 2012 gone? The year wraps up just 11 days! But that's still plenty of time to pay heed to Blitzen's tax advice: Convert your traditional IRA to a Roth account. Blitzen design by BoBunny This eighth Reindeer Year-end Tax Games Tip of 2012 from Santa's lightning fast sleighmate is especially critical if you think you'll be in a higher tax bracket in the future. Your tax rate in the coming years matters if you have a traditional IRA because you'll owe tax on those retirement distributions at your ordinary income rate. That's right. Traditional IRA withdrawals are taxed... Read more →

You've got to give House Speaker John Boehner credit. He's united a diverse group of lawmakers, lobbyists and policy groups in their disdain for his fiscal cliff Plan B solution. House Speaker John Boehner making a fiscal cliff point on the House floor, Dec. 13, 2012. Photo courtesy the Speaker's office. So what's got folks shaking their heads? Among the proposals highlighted on the Speaker's web page are: Permanently extend the current income tax rates -- 10 percent to 35 percent -- for everyone making less than $1 million; for millionaires and more, the top rate would be the 39.6... Read more →

What was that terrible noise? Oh, it was some of the holdings in your portfolio crashing. So sorry. But you're not alone. Even in good times, we all make some investment moves that don't pan out as we had expected or hoped. Donder (or Donner or Dunder in various Santa sleigh reports), the reindeer who knows all about loud and terrifying noise since his name means thunder, says you shouldn't be too upset about the sound of your shattered financial holdings. "Did you hear that?" courtesy Point Counter-Point Point Point blog They could turn out to be worthwhile at tax... Read more →

Unless you're a couple of tax professionals, the Internal Revenue Code probably had very little to do with your courtship. But the truth is, taxes can be a big part of every relationship. For most of us (and soon maybe more of us after the Supreme Court hears an estate-tax related same-sex marriage case), our tax laws have an effect on us once our relationships move to the "I do" phase. That's why Santa's romantically-named reindeer Cupid reminds us that our marital status on Dec. 31 determines our filing status for the whole tax year. These wise words are Reindeer... Read more →