Tax Attic

THE TAX ATTIC with Jerry Coon

August 9, 2012 // 0 Comments

“We are masters of our own deception.” Bryan Boersma, Rockford Reformed Church’s Associate Pastor, started his sermon last Sunday by attributing this quote to one of his favorite authors, Frederick Buechner. Bryan actually said he thought this was a quote from Mr. Buechner, but couldn’t put his finger on it. I have read some of Mr. Buechner’s writings and while I couldn’t find that exact quote either, it certainly seems Frederick Buechner’ish to me. Bryan’s sermon was on the topic of Jesus’ parable of the Good Samaritan. As one of the factors in gaining eternal life, we are told to love our neighbor. According to Bryan, how we define loving our neighbor is exactly where we are the masters of deceiving ourselves. In fact, we can be downright selective in defining who we want to love and how we want to love that person. In the parable, a priest and a Levite chose to not define the person lying on the side of the road as their neighbor and since he wasn’t their neighbor, they didn’t need to love or, in this case, help him. The Good Samaritan came to the opposite conclusion, helped the beaten person, and received praise from Jesus. Bryan’s sermon was certainly thought provoking. In how many situations have I been pretty good at deceiving myself? How many times should I have helped someone and didn’t? Of course, I’m going to say to my recollection, it has never happened. I don’t believe that I’m a master at deceiving myself, but perhaps I am so good at thinking I’m not deceiving myself that I really am a master at it. Let that sink in for a moment. Thank you, Bryan, for making me consider how I define my neighbor and, in turn, how I should love that neighbor. The Patient Protection and Affordable Care Act (ACA) is an attempt by the federal government to require all people to participate in the health care system. The logic is that everyone is participating in the health care system to some extent now, but there are approximately 30 to 50 million people who don’t pay to participate because they don’t have insurance. The costs associated with the 30 to 50 million people is borne by […]

THE TAX ATTIC with Jerry Coon

August 2, 2012 // 0 Comments

What is ‘Obamacare’? Last Saturday, I saw a clear example of what causes road rage. I’m not condoning it, but I wouldn’t have been surprised to see an accident occur because of it. After having played two slow-pitch ball games Saturday morning in Kentwood, I was limping my way home on the expressway. Mentally, I was limping because we lost both ends of the double-header, and physically limping because of a slightly damaged Achilles tendon injury that I have been nursing for a while. When I hit 44th St., the traffic started backing up because of construction between Hall and Wealthy streets. There were visible signs that the left two lanes were closed, so most drivers were using the common courtesy approach and began pulling over into the right hand lane. Some drivers, however, ignored the lane closing signs to the bitter end. Displaying a complete lack of common courtesy, they went speeding by the multitude of cars in the right hand lane. There is no excuse for that action and I believe it may even be illegal. Believe me, it didn’t go unnoticed by those sitting. Once in a while, one of the larger vehicles did pull out into the left lane to slow the passing traffic down. I thought about that, but I was in a Sebring Convertible. Since the Sebring doesn’t have much of a profile and I might have ended up getting squashed, I just sat in the right lane and waited my honest turn. I did have the top down so, in addition to seeing the hand signals, I also heard some expletives hurled at the passing cars. In all honesty, from time to time in the past, I have been caught out in that left lane with construction coming up and did pass some sitting cars. However, as soon as I figure out what is going on, I make my way into the proper lane. Many of those people on Saturday were not making any type of effort to move over. They were making an honest effort, executed at high speed, to pass as many cars as they could before the lanes got cut off. That’s wrong. Perhaps the Secretary of State could put that ethical question on the […]

THE TAX ATTIC with Jerry Coon

July 26, 2012 // 0 Comments

A nonpartisan solution I recently attended a conference for Money Concepts, the broker dealer firm that I am associated with for the financial planning portion of my business. One of the speakers was Dan Greenwell, a very successful and longtime associate in the Money Concepts system from Money Concept’s Kentucky Bluegrass Region. Dan titled his talk “What’s Next?” It centered on what we need to do to succeed in the future not only in the financial planning business but also in life in general. The first portion of the speech involved Dan’s advice that we must be prepared to embrace change. He also gave his recommendations on the actions to take to benefit from those changes. The second portion of the speech was a little more emotional. Dan gave us the four life principles that he learned from his father. His father was a successful businessman who died of a heart attack at age 63. He ran his business, the largest tire dealership in the five-state Kentucky area, and also his life, using the following four principles as his guide. These four were the principal reasons for his success. First, always do what is best for the client. Ultimately, what is best for the client will be best for you. Second, always tell the truth. It’s the only way you won’t forget what you told to someone in the first place. Truer words were never spoken. Third, if you borrow money, pay it back. Dave Ramsey would have loved Dan’s dad. Fourth, integrity is the only thing you take with you to the grave. Your money stays here. Your cars, your business, your house, your boat, your motorcycle, your friends, and your relatives all stay. Your reputation and your integrity, however, do live on in the sense of how people remember your life and time spent here. Those won’t help you either as you approach the pearly gates for that day of reckoning. However, on this earth, I believe one of the finest tributes that can be given to someone is to say he or she is and was a person of integrity. I didn’t know Dan’s dad, but I do know Dan, and he has the type of reputation that we all hope to […]

THE TAX ATTIC with Jerry Coon

July 19, 2012 // 0 Comments

Affordable Care Act, Social Security In a 5-4 split decision, the Supreme Court ruled that the Patient Protection and Affordable Care Act was constitutional. The Court ruled that Congress has the power and authority to create and pass a law that taxes people for not complying with the law. In this case, if a person doesn’t sign up for health insurance, there will be a penalty in the form of a tax to be paid as part of the person’s tax return for failing to comply. Interesting concept: tax for noncompliance. That concept all by itself might keep Action Tax Service going well into the foreseeable future. Now that even the Supreme Court agrees that Congress can use the tax return to get us to do something, the possibilities are absolutely endless. Of course, if Congress gets too carried away with this tax for noncompliance, they will still have to answer to us, their ultimate bosses. For example, it might be hard to vote for an incumbent who votes to pass a law that would tax anyone who doesn’t take their one-a-day vitamin or who doesn’t walk 500 steps per day or who drives a car more than 100 miles a day unless 80 of those miles are driven in a hybrid. Like I said, the possibilities are endless. I was hoping to retire sometime in the next 20 or 30 years, but now, with this development, I’m not sure I will make it. Just think of all of those people who will need help on their tax returns to calculate those noncompliance taxes. Americans are an independent lot and a certain number of people will go right just because most everyone else is going left and especially so if someone at the head of the line is demanding that everyone go left. The defenders of the law, the administration, had hoped that the law would be upheld as a manner of regulating commerce under the Commerce Clause. The tax argument was more or less an add-on argument. I believe the theory is to throw as many things at the wall as possible and perhaps one of them will stick. It worked. The Supreme Court ruled against the Commerce Clause argument and said that Congress […]

THE TAX ATTIC with Jerry Coon

July 12, 2012 // 0 Comments

Myths involving Social Security Last week, two significant developments occurred that affect Rockford residents. First, the Environmental Protection Agency (EPA) issued its Preliminary Assessment Recommendation for the Wolverine Worldwide former tannery site downtown. The report concluded that the Michigan Department of Environmental Quality (MDEQ) and Wolverine Worldwide (WWW) can work together on “further site investigation and remediation activities.” The EPA will receive a report at least twice a year detailing the MDEQ and WWW activities. While the site does not warrant being named a Super Fund site under the Comprehensive Environmental Response, Compensation and Liability Act at this time, it does warrant further investigation and testing and will be designated as an “Other Cleanup Activity” site. The EPA found that WWW has shown good faith during this entire process and will develop plans in the future with the input and approval of the MDEQ. This is great news for WWW, the City of Rockford, and the residents of the surrounding areas who visit downtown Rockford and enjoy the Rogue River. Stand by for what happens next. That has not been defined as yet, but it has to be better than the site being named a Super Fund site. “Other Cleanup Activity” has a more settling sound to it than Super Fund. The second development occurred last week when the Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act or as it is more commonly known as “Obamacare.” I will discuss the significance of the landmark decision next week. There are a number of myths or misconceptions associated with the Social Security system as it stands right now. We are a society of wanting to get things done right now. “Instant gratification” I believe is the term used to describe our impatience with taking a long-term approach to many things. Unfortunately, instant gratification and Social Security do not work together. Accruing benefits is a long-term proposition. A few weeks ago I went over the formula used to calculate a monthly benefit. The Social Security Administration (SSA) uses 35 years of work history in that calculation. In light of the SSA using 35 years, I think one of the biggest myths or misconceptions is that a monthly SSA benefit can be significantly increased […]

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