Don't Mess With Taxes

A CNN/Opinion Research Corporation poll conducted just after the new tax relief bill was signed into law reveals that three-quarters of Americans like the tax cuts. When the provisions of the deal were broken out, the lower tax rates for families making less than $250,000 a year were favored by 89 percent of the poll respondents. On the other end of the tax spectrum, however, only 37 percent of those surveyed liked the extended tax cuts for folks making more than a quarter million a year. The pollsters probably didn't call well-known television grouch Larry David to ask his opinion... Read more →

Tax laws are like holiday fruitcakes. They're dense and mysteriously show up in late December. Everybody picks at them, but they never seem to be totally consumed. That's how it is with the tax bill signed into law last week. The tax compromise got lots of attention for extending 2010's income tax rates for a couple more years. But it also continues several other tax breaks that could help reduce your tax bill when you file your return next year. I plan to keep blogging in more detail about the various ingredients provisions, both that apply to the 2010 tax... Read more →

Whatever you think of the just enacted tax bill, we at least finally have some resolution to the 2010 and 2011 tax laws. Now comes the fun part: Complying with them. I suspect the IRS will have its hands quite full in the coming months as taxpayers and tax professionals alike sort through all the retroactive and prospective law changes. And you know what that means: Confrontations, I mean, interactions with IRS employees. OK. I do mean confrontations. Even in the best of times, taxpayer experiences with the IRS often don't end well. Now, however, taxpayers can do more than... Read more →

Given the popularity of The Walking Dead, it shouldn't be surprising that there's a lot of interest in the law dealing with the intersection of death and taxes. Statistically, very few taxpayers are affected by the federal estate tax itself. Most estates aren't large enough to warrant IRS interest. But even if an estate doesn't trigger collection (or in 2010, noncollection) of the tax, its heirs could end up owing depending on what they inherit and what they subsequently do with their bequests. I'm again talking, of course, about the basis of property distributed after a loved one dies. As... Read more →

Embed from Getty Images With Obama's signing of the compromise tax deal yesterday, the really wealthy were among those who got an early tax present. Some of the House Democrats railed against this latest version of the estate tax, but in the end, it passed. For 2011 and 2012, estates worth $5 million or less won't be taxed at all. For estate values greater than that, a 35 percent tax rate will apply. That's better than the 2009 law, which imposed a $3.5 million exemption and a 45 percent tax rate on the excess. And it's much better than what... Read more →