Tax Attic

Useful tax tips and information from Jerry Coon of Action Tax Service.

The Tax Attic with Jerry Coon – September 17, 2009

September 17, 2009 // 0 Comments

Michigan Residential Energy Credit to have positive effect I don’t consider myself a superstitious person. I don’t really believe in omens. However, I do pay attention to events as they occur, draw conclusions from those events, and base my actions on those conclusions. For example, over the Labor Day weekend, Deb and I camped along with her brother, Don’s family, at Muskegon State Park. What a wonderful weekend and a nice facility. Don and I salmon fish. The park has an excellent place to moor the boat near the channel. It took about 20 minutes from the time we left the trailers to the time we dropped a line in the water. We caught some fish over the weekend. Don and Renae left Monday, but Deb and I stayed over to Tuesday, so I planned to troll carefully up and down the channel Tuesday morning for an hour or two before loading up the boat and heading home. About 6:30 a.m., I went down to the beach to wade the 100 feet or so out to the boat. As I approached the beach, I was surprised to see the boat sitting within a few feet of the shore—not good. My mooring set-up had broken loose. It’s a good thing I had thrown an anchor out to help stabilize the rear end. That anchor kept the boat from totally washing up on the shore, and that would have been a disaster. This is one of those times when you analyze the situation and decide whether it’s a good omen or a bad omen. I was either being given the red carpet treatment—I didn’t even have to get my feet wet to jump into the boat and the fishing was probably going to be fantastic—or the mooring breaking loose was telling me that I shouldn’t go out fishing by myself because some further bad thing was going to happen. Not wanting to tempt fate, I chose to not go fishing. I sat in the boat, drank my coffee, watched a beautiful sunrise, and saw a few people in the channel catch fish. About 8 a.m., I walked back to the trailer and told Deb the story. She wasn’t all that sure about me going fishing by myself […]

The Tax Attic with Jerry Coon – September 10, 2009

September 10, 2009 // 0 Comments

Who qualifies for first-time home-buyer credit? The traditional ending of summer has occurred. The long Labor Day weekend has come and gone. The kids are back in school. High school, college and pro football games are here to stay for the next few months—that’s a good thing when it comes to Rockford football, a good thing when it comes to our in-state college football programs, but a questionable thing when it comes to Lions football. The baseball season, at long last, is in its last month and the Tigers are holding their own. The first day of baseball back in April seems like such a long time ago now. I do look forward to the playoffs. Perhaps Detroit will have a good-run playoff this year. They have just a good enough team with a few good pitchers and a few good hitters that I really wouldn’t want to play them in the first round of the playoffs. As the old sayings go, “Lightning can strike anywhere,” and “Even a blind squirrel finds an acorn once in a while.” They especially apply to a short playoff series. It’s not inconceivable that the Tigers could end up in the World Series. Many of my buddies are out practicing their bow-and-arrow skills in anticipation of deer-hunting season. It’s going to open soon and then, not long afterward, those of us who won’t or can’t shoot a bow get a chance to bag a whitetail buck with a little more firepower at our disposal than an arrow. In my case, that firepower is called a Remington 30.06 rifle, a Wing-master 12-guage shotgun equipped with a slug barrel, or a Thompson 50 caliber black powder gun. All of them have scopes, of course. Even though I did have Lasik surgery a few years ago, I still need all the help I can get to make the best shot. Night temperatures are falling into the 40-degree spectrum. Trees here and there are turning colors. Fall comes too quick for many people, and it did seem to come about halfway through August this year. That’s a little fast for even me. Something else that is coming up fast is the tax season. I know it’s only September, but in four short months, […]

The Tax Attic with Jerry Coon

September 3, 2009 // 0 Comments

Swiss banks give up names, information Recently, there has been much publicity that the U.S. government has worked out an agreement with a Swiss bank, UBS, wherein the bank will provide taxpayer identification and investment information to the Internal Revenue Service. We all know the old saying, “Never say never.” The saying definitely applies to this situation. Since the 1800s, the Swiss banks have steadfastly refused to provide any bank account information to any outside authority. They would never give up the names of their investors, let alone provide actual investment account figures. The Swiss even told Adolph Hitler to go jump in a lake. The Swiss banks have steadfastly relied upon Swiss law to not comply with any and all foreign government requests for investor information. Under Swiss law, tax fraud or actively misleading authorities is a crime. However, under their system, passive tax evasion or just failing to declare an asset is not a crime. If the foreign authority could prove the investor was involved in tax fraud or actively misleading authorities, they got their information. I have the feeling they didn’t have to provide much information. In 2002, the European Union began asking for information for investors who were not defined as criminals under Swiss law, and it was successful in some of its requests. Evidently, the Swiss did not and do not want to be known as an “uncooperative tax haven.” They have made quite a reputation as a tax haven but not an uncooperative one. Using the same logic as the European Union, the IRS sued UBS, asked for names, and also was successful. UBS agreed to pay $780 million in penalties and offered to turn over information on 250 U.S. investors. The IRS took the $780 million but sued for information on 52,000 investors. That figure was negotiated down to 4,450 names, presumably the top dogs. The IRS is giving those 4,450 U.S. citizens the chance to fess up on their own by filing missing tax returns or amending tax returns to include missing income. They are offering a type of limited amnesty for those who step forward. The penalties will be much less severe. Talk about being between a rock and a hard place. First, it’s not clear […]

The Tax Attic with Jerry Coon – August 27 2009

August 27, 2009 // 0 Comments

Should government be involved in health care? The bill before Congress is entitled “America’s Affordable Health Choices Act of 2009.” When all is said and done, the final version of the bill that President Obama signs will influence the health care of all of us, our children, and our children’s children. I believe it’s that big of a deal. It’s an emotional topic. From what we see on the television, people are not afraid to voice their opinions about government’s further involvement in health care. I say “further” involvement because we do have the Medicare and Medicaid programs that are currently administered by the government. Is there waste in these programs? Yes. Is there a bureaucracy in these programs that makes it difficult to deal with at times? Yes. However, do the programs run as they are advertised? I would say yes. When a taxpayer turns 65, he/she enrolls in Medicare and usually ceases to be covered by normal health insurance. This happens every day, all day long, and usually happens without a glitch. Many taxpayers, however, do purchase a supplemental policy because of the shortcomings of Medicare. When an elderly person in a nursing home runs out of money and is no longer able to pay for care, Medicaid somewhat seamlessly picks up the paying of the nursing home. This also happens all day long, usually without a glitch. So, let’s start with the assumption that our federal government is already involved in the health care business, but currently it is limited to the 65-and-over crowd. They now want to get involved in the under-65 crowd. Perhaps we should be reviewing the Medicare and Medicaid programs to see if the federal government is worthy of expanding their involvement. Are they controlling their costs or do they have the same problems the private sector has with wildly increasing costs? How is the health care for the participants compared to the private sector? Just because the federal government can get involved in the under-65 crowd’s insurance doesn’t mean they should. Of course, the federal government’s motivation for this involvement comes from two items. First, there are approximately 47 million Americans who are not covered by health insurance of any type. More people every day are joining […]

The Tax Attic with Jerry Coon

August 20, 2009 // 0 Comments

Everyone affected by health care reform Health care reform may be the biggest issue currently confronting all of us. The troubles of the automobile industry are well-documented and their problems do affect each of us in some way. My father was a GM retiree, so my mother’s survivor’s benefits may be directly affected by what is happening with GM. The demise of GM’s 36th Street plant has also meant the closing of various local suppliers. Many of my clients are out of work because of GM. Not everyone, however, is directly affected by GM’s troubles. The decline of the housing industry, the collapse of the derivative products and the worldwide messiness that went with that debacle such as the corresponding banking institution failures and all of the foreclosure issues have caused heartburn among many taxpayers. Not everyone, however, is directly affected by the housing or banking industry issues. By the same token, everyone, and I do mean everyone, is affected directly by how Congress deals with the health care reform issue. All of us, from the newest baby on the block to the oldest taxpayer in America, will be affected by the bill that this Congress passes to President Obama for his signature. The bill currently on the table, called “America’s Affordable Health Choices Act of 2009,” will set the tone for health care for generations to come. Some types of legislation come and go. Tax legislation, for example, is passed frequently. Each Congress and President influences the ebb and flow of tax legislation. Taxes go up, credits are increased, credits are eliminated, and deductions come and go. It happens every year. If we don’t like something in this year’s bills, we can wait a year or two and it might change. Another example is the agriculture bill that is passed every year. It is somewhat routine in nature, albeit sometimes controversial. Congress decides how much money the agricultural community will get and how it will be divided up. It happens every year. If the community doesn’t like how the money is split up in this year’s bill, they can wait a year or two, work with their lobbyists, and it might change. Somehow, I get the feeling that health care reform isn’t going to […]

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