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September 2013

Most people claim the standard deduction. It's easy to see why. It's easier than itemizing. The standard amounts, which typically are increased at least a bit each year for inflation, are usually printed right on the 1040. And there are no receipts to track and add up at tax filing time. But if itemizing would produce more than your standard amount, it could be worth the effort of filling out a Schedule A. If you've never checked out Schedule A, it could be a bit intimidating. But remember, you don't have to fill out every line, just the ones that... Read more →


Just like filmdom's persistent poltergeists, Congressional attacks on the Internal Revenue Service are back. House Republicans are hoping that new looks into IRS improprieties in dealing with applications for tax-exempt status will recapture public attention. IRS email appetizers: The stage was reset by an unbylined outlook piece in the Wall Street Journal this week entitled "Lois Lerner's Own Words." House Ways and Means Chairman Rep. Dave Camp (R-Mich.) posted the column in full on the committee's website and sent out an "in case you missed it" notification of the article via email. The newspaper looks at emails between Lerner, now... Read more →


School's back in session! So are the expenses. But your favorite relative, Uncle Sam, might be able to help. There are many tax breaks that can help students, and their parents, cover education costs. The options are this week's Weekly Tax Tip. Savings plans: There are two tax-advantaged educational savings plans. A 529 plan is an increasingly popular way to pay for college costs. A recent study by education loan provider Sallie Mae found that 17 percent of families last year tapped 529 funds, the highest percentage since the study began in 2008. The numerical name of this educational savings... Read more →


Today is one of those days where you remember where you were when you heard about or saw it. "It" actually is "them," four separate terrorist attacks in New York City, Washington, D.C. and Shanksville, Pa. on America on Sept. 11, 2001. The aftermath of each of these events was felt well beyond the borders of the actual plane crashes. The consequences continue to affect us a dozen years later. I hadn't planned to post anything 9/11 specific today. But then I turned on my television this morning just in time to see the President and First Lady, the Vice... Read more →


Admit it. You wish you had been in Denver yesterday. That's where opponents of a special sales tax on personal use of pot rallied support for their cause by handing out more than 1,000 marijuana cigarettes. Marijuana cigarettes passed out in Denver to protest a proposal to add a sales tax to recreational pot sales. Click image to watch WUSA 9News video. The sales tax initiative will be on Colorado's November ballot. Colorado voters last year approved recreational use of marijuana. Individuals age 21 and older can possess up to an ounce marijuana for personal use, as well as grow... Read more →


Somebody remind Robert Fernandes of Oliver Wendell Holmes, Jr.'s approach to taxes. The esteemed Supreme Court Justice famously said, "I like to pay taxes. With them I buy civilization." Fernandes, however, wants to pick and choose which part of civilized society he wants to fund in his Forks Township, Pa., community. In this case, the father of three is unhappy about having to financially support public schools. Fernandes' kids are home schooled, so he thinks he shouldn't have to pony up for educating other children whose parents depend on such educational opportunities. "We don't even use the public system, yet... Read more →


The chairmen of the two Congressional tax-writing committees will say thank you, thank you very much today to folks in Memphis, Tenn., for their suggestions on how to overhaul the tax code. Finance Committee Sen. Max Baucus (D-Mont.) and Ways and Means Chairman Dave Camp (R-Mich.) start their day with an 8 a.m. conversation at the Sullivan family farm in Oakland, a community of around 7,000 east of Memphis. The Congressmen want to hear from the Sullivans about their tax experiences and how they manage their farm's finances. After that chat, Baucus and Camp will head into Elvis' hometown to... Read more →


Remember the infamous 47 percent of people who didn't pay taxes? Sure you do. Those were the folks cited in a 2009 estimate by the Tax Policy Center (TPC) who inadvertently sabotaged Republican presidential candidate Mitt Romney's quest for the White House when he was caught on video tape characterizing them as government dependent takers instead of economic growth makers. That group is now 4 percent smaller, according to the latest analysis by TPC, a joint venture of the Urban Institute and Brookings Institution. The 43 percent of Americans whom TPC analysts project won't owe federal income taxes in 2013... Read more →


Americans are a mobile group. We tend to move a lot. But a lot more of us are moving out of the country, and doing so for good. You've heard the proclamations. "If he's elected, I'm out of here!" Folks across the political spectrum angrily declare this intention every U.S. presidential election year. Few, however, follow through. "When I win the lottery, I'm moving to Italy." Or France or Brazil or Australia. This is my mantra. Most of the time, though, folks just take nice long vacations to those foreign locales. I promise to at least buy a second home... Read more →


A volunteer at the James A. Haley Veterans Hospital in Tampa, Fla., is charged with stealing patients' identities and, along with another man, using the information to file fake income tax returns. The fraudulent filings produced around $550,000 in refunds, according to federal court documents. A U.S. District Court for the Northern District of Florida grand jury returned indictments against Ricardo Jacinto Rodriguez and Andropolis Jioberiti Mitchell. Andropolis Jioberiti Mitchell, left, and Ricardo Jacinto Rodriguez are accused of stealing hospitalized veterans' identities and using them to file federal tax returns that produced fraudulent refund amounts. Rodriguez allegedly used his volunteer... Read more →


The good news is that 169,000+/- folks found jobs in August, according to the latest Bureau of Labor Statistics data. Those workers help push last month's unemployment rate down to 7.3 percent, a smidge lower than the 7.4 percent out-of-work rate in July. In August 2012, the unemployment rate was 8.1 percent. The not so good news is that another reason the unemployment rate dropped at all last month is because 312,000+/- people stopped looking for work. If, however, you did start or continued your job search, your efforts might be tax deductible on your next federal return. As this... Read more →


Gun lovers in Louisiana, this is your weekend. Starting today, Friday, Sept. 6, and running through Sunday, Sept. 8, your purchases of firearms, ammunition and hunting supplies are free from sales tax. That's right. It's Louisiana's Second Amendment Sale Tax Holiday time. Louisiana sporting goods store owners say the annual tax-free event is bigger than Black Friday. Firearms shopping list: Firearms eligible for the sales tax exemption include shotguns, rifles, pistols, revolvers or other handguns that are legally sold or purchased in Louisiana. Ammunition for the weapons also is tax free. Hunting supplies are exempt from sales tax only if... Read more →


Football fans will see tonight whether Baltimore Ravens quarterback Joe Flacco deserves the record $120.6 million deal he signed following the team's win in Super Bowl XLVII. What we won't see during the 2013 NFL season kickoff game between the Ravens and Denver Broncos is that Flacco's highly publicized salary is really not tops in the NFL. Half (or more, depending on the team's playoff schedule) of the games that the Super Bowl MVP will play are in Maryland. That means he'll owe the Old Line State's top income tax rate of 5.75 percent on his home-field earnings. Then there... Read more →


Ella Joshua-Dixon is the latest example of the cynical adage that no good deed goes unpunished. The Detroit native just wanted to help her financially struggling hometown by letting the Motor City have her 2011 municipal tax refund of $500. And what did Detroit tax officials do? They sent her a bill for more than 10 times that. The city's income tax division contended that Joshua-Dixon owed back taxes dating to 1999 that, when interest and penalties were added, came to $5,296. Not so fast. Detroit messed with the wrong taxpayer. The 47-year-old Auburn Hills accountant had the documentation to... Read more →


Welcome September! We've been looking forward to your arrival. You bring us the return of classes, welcomed by many school children and many more parents, and the promise of cooler autumn temperatures. Yes, September, you also are often a very busy month for the Atlantic hurricane season. But here in drought parched Texas, we'll take a storm or two -- minor, please! -- to get some much needed moisture. As with most of life, many of September's offerings also involve taxes. In some cases, there are costs, such as with the third quarter estimated tax payment due on the 16th.... Read more →


Taxpayers in the United States do most of their work in the first quarter of the year, but to get the best tax result, you need to pay attention to tax tasks year round. So on this Labor Day 2013, the 120th Tax Carnival celebrates working on taxes. But before we get to tax specifics, let's start with some fun Labor Day facts from the Department of Labor, the U.S. Census Bureau, the Bureau of Labor Statistics and a variety of other websites and blogs. The first Labor Day observance was Sept. 5, 1882, when around 10,000 workers assembled in... Read more →


It's around 1,100 miles from the northeast corner of Texas to the southwest corner of New York, but the Empire State has been on my mind of late. No, it's not because I still can't erase from my mind's eye the Miley Cyrus performance (yeah, let's call it that since this is a family-friendly tax blog) at MTV's 2013 Video Music Awards in Brooklyn's Barclays Center. And no, it's not even because the 2013 professional football season is about to start with my Dallas Cowboys' hosting a Sept. 8 game against NFC East rival the New York Giants. It's because... Read more →


It's getting harder to escape online sales taxes. As of today, Sept. 1, shoppers in Georgia and Virginia who purchase products from the internet giant Amazon will see their states' sales taxes added to their bills. This brings to 12 the number of states in which Amazon collects sales taxes. That's also this week's By the Numbers figure. Photo by MikeBlogs via Flickr Creative Commons The dozen states, so far, where Amazon collects sales taxes are Arizona, California, Georgia, Kansas, Kentucky, New Jersey, New York, North Dakota, Pennsylvania, Texas, Virginia and Washington. Expanding nexus: In most states where Amazon has... Read more →