Futures trading is fast becoming a very popular investment option, because a lot of people have managed to make it big trading futures. If you're interested in joining that elite group of successful individuals, but have no idea how to take that first step, then read on, because this article will tell you how to learn from simulated futures trading.
The internet has made available countless of online tutorials and lessons on a wide variety of subjects, ranging from designing your own garden to designing your own website. Futures trading is no exception, and if you look hard enough, you'll be able to find a rare gemstone or two; a website that will impart to you all the knowledge you'll need to get started.
Sure, you've gotten the basics down, and you've got the theory etched into the back of your eyelids, but without practical application, the knowledge you've gleaned from all that reading and researching won't mean a thing. Previously you might have read about concepts and theories and strategies in your research; by the end of it you'll know the rules of the game.
But how do you play the game?
That's where a simulated futures trading program comes in. At this point, if you're a beginner, you might be asking yourself: What exactly is a simulated futures trading program anyway?
It's exactly what it says it is; a program that simulates the futures markets, one that allows you to apply all the theories that you've learned into practical application by practicing futures trading, without having to risk any real money. Many futures brokers have made such programs available online for the usage of their prospective clients, usually free for a limited trial period of thirty days, but if you feel the need for more practice, you should be able to continue using the program for a nominal price. Simulated futures program may vary from one futures broker to the next, but they come pretty much standardized in certain aspects.
Normally you would be given a simulation account, with "fake" money to make trades with. You can use this money the way you would use "real" money offline, but of course, because it's a simulation, any losses you make won't burn a hole in your pocket. Along with the simulation account, the program would provide you with the same tools and information any real trader would have, and this is why learning through simulation is advantageous for beginners. Since the program is essentially a simulation of the real world futures markets, you would be exposed to the same exact market conditions as you would be if you were trading for real, and the simulation should give you a good measure of how you would fare should you delve into the real world markets. Every decision made in the simulation would be a determinant factor in your potential success or failure in your real trades, so it is imperative that you get the most out of your practice with the simulated futures trading program before embarking on the real deal.
Eventually the hands-on experience prior to your real dealings with the futures markets will prove to be invaluable, because at some point of the simulation you might feel that futures trading might not be for you. So rather than potentially having the bitter experience of losing your money in the futures market, and THEN deciding that trading futures isn't for you, you can easily back out from any further ventures with futures trading as long as you're still practicing with the simulated futures trading program.
SnapDeal
As for everything else, the World Web has become a major link for individuals as well as trading communities across the globe. It has become a source of information, as well as a platform for investment opportunities. And with the emergence of the new futures trading software, novices as well as experts can truly believe that the world is in their hands!
Any sort of software can boost an individual's confidence since it creates a gateway to better understanding of an industry and its products. So also with futures trading software. Not that buying and selling of stocks will seem like a cakewalk now, but it should prove to be a much easier task than before!
What are the benefits of having futures trading software?
(1) The tools are extremely useful for financial investors, traders and brokers who are interested in organizing and developing their investment choices.
(2) It is easy to keep track of day-to-day activities in the trading arena.
(3) In fact, they are able to supervise every move, as well as save transactions conducted in the past to keep as handy references for the future.
What are the tools actually provided by the futures trading software? Some of the basic ones are listed below--
(1) Archives keep a record of future prices of stock with the help of tickers. The trader is therefore able to evaluate the rise and fall of prices/values every hour and every day. This makes it possible to predict the future of currently available stock, as well as the direction of the values in future. The tool here is named, stock predictor.
(2) A ticker is nothing but the bar that appears on the lower part of the T.V. screen, when viewing different business news channels. The ticker displays the company name and the current price of its stock alongside it. The reason why investors as well as brokers watch these tickers with interest is because they give an indication of the rise and fall of stock prices in the market. They can then trade accordingly.
(3) The software applications also come with chart tools. The chart tool aids in converting stock price data into the form of charts. It becomes a lot easier for the investor, analyst or viewer to keep track of a particular stock, as well as find out in which direction its price is moving.
(4) Futures trading software would be incomplete without the currency converter, considering that stock trading has become an international business. There are foreign investments to be considered, as well as cross-border investments.
(5) The best tool is simulated futures trading software. A trading environment can be simulated such that the trader can go through the motions of actual trading. After constant practice and with the utilization of basic skills, the novice can ready himself/herself to put his/her learning to the test when the time arrives.
(6) For simulation of a trading environment, the futures trading software should be equipped with the correct tools. The learner should be ready to expend time on practice. Patience is an important quality because results will not be readily forthcoming. What one ultimately gains is--application of strategies, courage not to buckle under pressure and readiness to face the trade world at the right time.
Are you interested in making money? If you are, you may want to take the time to familiarize yourself with online futures trading. The trading of commodities for currency is a business venture that many are able to profit from. Although online futures trading is a great way to make money, you may be wondering if it something that you can do, particularly while making a profit.
Online futures trading is defined as the trading of commodities, online. What you may not necessarily know about online futures trading is that many who are doing trading online, are experienced traders. There is a difference between online futures trading and futures trading with the assistance of a futures broker. Many beginners or those who do not have time to fully examine the current market on their own, rely on the assistance of a futures trading broker. That broker will not only advise their client, possibly you, on their trades, but they will also make them. Online futures trading typically involves making your own trades.
Since online futures trading involves handling your own account, you may be wondering whether or not it is something that you could handle. First, before jumping right to online futures trading, you may want to take the time to research it, inside and out. There are a number of futures trading or futures investing resource guides that you can buy online, locally, or even find in your local library. You can also take futures trading training programs. One program that you may want to look into is a futures simulated trading program. These programs are run by most futures brokers and they allow you to do your own online futures trading, but without using your own, "real," money. This may give you a good idea as to whether or not you are ready for online futures trading.
As a reminder, if you are unsure as to whether or not online futures trading is right for you, you may want to think about consulting with a futures broker. Many futures brokers can give you their own personal tips and suggestions. In fact, you may even want to start out using the assistance of a futures broker, when you first start trading. If that is would you would like to do, you may want to opt for a professionally managed trading account or a full-service account. Yes, these accounts will cost you a little bit more money, but it may end up being money well spent. Should you later decide that you are ready to handle your own trades, account, and portfolio, you should be able to change you account to an online futures trading account.
In short, online futures trading isn't right for everyone, but, as outlined above, you don't have to start with online futures trading. There are a number of others accounts that you can create to start making money with futures trading.
Ulysses Faust is a writer for Transworldfutures.com where you can find accurate information about Online Futures Trading [http://www.transworldfutures.com/online-futures-trading.php] and other related information.
Wedding wear has become extremely popular lately with celebrities being seen in pretty "The Future Mrs..." and "Bride-to-be" type apparel. Wedding clothing can highlight your excitement for your wedding while still looking like a pretty piece of your wardrobe. Here's some tips for adding wedding apparel into your daily outfits.
1. Hats - Cute hats that proclaim "Bride" or "Maid of Honor" are a great way to show off your excitement for your upcoming nuptials. Popular types include rhinestones or bright lettering, and would look great with that diamond on your finger!
2. Hoodies - Mmm, a soft, warm hoodie. Hoodies are the ultimate in comfort and ideal for relaxing or casual outings, and perfect for keeping it relaxed on your honeymoon. They usually come in tons of different colors, so you can pick one you'll wear again and again!
3. Tanks - Are you a summertime bride? Personalized tanks for you and your bridesmaids are the perfect bachelorette party attire during those hot summer months. Enjoy your bachelorette party and attract some attention to yourselves in wedding theme tanks.
4. Groomsmen Shirts - Encourage your husband-to-be and his groomsmen to enjoy a fun golf outing, and supply them with witty t-shirts to wear. Sure, they may not want to wear a rhinestone tee like you and the girls, but a funny t-shirt is always welcome!
5. Kid's Tees - The little flower girl and ring bearer will be excited to wear personalized wedding clothing, too! Deck them out in adorable tees to match you and the bridal party's wedding clothing.
Wedding wear is a great idea to get everyone excited for the wedding, especially if you've had a long engagement. You'll be excited and ready to say "I Do!"
Written by Ali M. on behalf of PWPOnline.com. Browse PWPOnline for wedding articles and tips, and beautiful and affordable wedding accessories, particularly Wedding Wear.
Unless you were living under a rock, you are well aware of the financial challenges our country has been facing. We are without a doubt at a historic crossroads. In fact, this uncharted territory has so many experts only guessing to what our future holds.
If you think hard enough, I bet you can remember the "good old days". Remember a few years ago when jobs were in abundance, technology was on the rise, and it seemed like everyone was making money...and a lot of money. We were buying fancy cars to impress, shopping at our favorite stores-on credit of course, and dreaming about how we were going to spend all the money we were sure to make when we climbed the corporate ladder. And then along came 2008.
Let's face it; most of us are just hanging on by our fingernails. If you thought you were alone I am here to tell you that you are most certainly not! Most of us are doing everything we can just to keep our heads above water.
But now is the time Ladies. Now is the time to take ACTION to begin rebuilding your "Fortune Fortress". After all, Girls Just Want to Have Funds!
Basically Are You Broke? It's likely been many years since you've sat across from your parents at the dinner table and been forced to listen to their financial advice. If you were anything like me, it probably bounced from one ear to the next and then out into an abyss. However, I urge you it is time to get back to basics and recall those money lessons that we learned so long ago. Think of these as the wardrobe essentials!
o Earn More Than You Spend: The concept is simple, but is it really? To build your "Fortune Fortress" you must simply earn more than you spend each month. Yes, it's just that easy.
o Pay Yourself First: It's ok to be selfish- You Come First! The old adage is that you should have 3-6 months of basic living expenses put aside; however times are changing. My challenge to you is to save 9-12 months of basic living expenses. Put the money directly into an interest bearing account, such as an ING Money Market account, and don't touch it until you need it for a rainy day. This is a crucial step that you should accomplish before you even begin to think about investing in the stock market.
o Write Down Your Biggest Money Mistake...and then TEAR IT UP: As women we carry a lot of emotional baggage as a result of our past money mistakes. You must let go of the guilt and grief to make positive steps towards your "Fortune Fortress". Write it down...and then TEAR IT UP!
o Invest In Yourself: Education, education, education...it's one of the only gifts in life that cannot be taken away from you. Take a class, earn a new degree, or simply enhance your knowledge base. You will reap rewards you can only image once you begin investing in yourself.
Not Basically Broke...But Will You Be? Ok, so maybe you did listen when you parents dished out financial advice. Maybe you have always been on top of your finances and brag to your friends about how well you are doing. I urge you to take caution and consider the items below as cash concepts you might not have spent too much time thinking about. Think of these as the fashion accessories that compliment the wardrobe essentials!
o Protect Your Paycheck: When was the last time you took a 12 month vacation? I am guessing never since we all live on cash flow. Likely your paycheck is your biggest cash flow asset. We spend a lot of money protecting our cars, houses, apartments and such but little to protect our number one asset; our paycheck. Statistics show that you have a one in four chance of getting sick or hurt for longer than 90 days prior to age 60. Talk to your financial adviser today about how you can protect your cash flow with a paycheck protection policy.
o Love Life: Most people think Life Insurance is just about death and don't realize how powerful it can be while you are living! If you own one type of this insurance, it can provide you with Tax-Free income for life at some future time.
o Make Money Magic: Start with 30. Collect all your receipts and bills for 30 days and create a comprehensive "Money Map", aka a budget. Be honest with yourself. You need to list everything from your mortgage payments to your clothing purchases to your utilities to your valet fees. Once you've created your "Money Map" you can begin to make small changes in your spending. Remember its small changes that make a large difference in your "Fortune Fortress".
o Get Cash Creative: It's time to get Cash Creative. I want you to look at your spending in creative ways. For instance; many women have the guilty pleasure of grabbing a magazine while in line at the grocery store. Let's say the magazine costs $4.50 and that you have to dive into this magazine every week. That's $225.00 a year you are spending. But what if you got a subscription to the magazine and that subscription only cost $48.00 a year. That's a difference of $177.00 every year. Now that $177.00 of savings could pay for part of your life insurance premiums or your paycheck protection policy. It is possible to have your cake and eat it too...just get cash creative. Or, WOW, you could even save or invest it.
o Find a Money Maven: Search out a Money Maven who can serve as a mentor to you. One of the best ways to learn is to follow in the footsteps of someone who has already chartered a course towards success. There is no reason why you should struggle through money mistakes that others have learned from. Find a Money Maven, buy her a coffee, take notes, and learn all you can from her.
I'd like to start with some numbers to get the ball rolling. In July, August and September of 2010, the ATO received 580,000 paper returns. Printed and layed end to end, the 132 page Tax Pack would be enough paper to go from Sydney to Perth five and a half times. Depending on the route you took. E-tax can can save all this paper as well as simplifying the whole process of end of year tax. So, what is e-tax and why - apart from the environment - should anyone use it?
The birth and growth of e-tax
Launched in 1999, e-tax allowed tax returns to be submitted over the internet for the first time and was a leap forward in the way that tax in Australia would be managed over the next ten years. In that first year 120,000 Australians downloaded and used the software, a figure which has grown to 2.3 million in 2009. Each year e-tax is improved from tax payers feedback to help improve the service and make filing easier for individuals. This ongoing improvement has helped grow e-tax usage in 2010 by 10% compared to 2009 pre-filling figures.
e-tax 2011: What will it do?
E-tax brings together much of the support given at the ATO website, a persons individual details and the documentation required to submit a tax return into one place.
Pre-filling of information. Once downloaded, e-tax links to millions of pieces of information about an individual tax situation including payment summaries, withheld tax, interest on savings, union and professional fees etc. This can help individuals find lost information and ensure it all goes in the right places on their tax returnA step-by-step submission process which guides you along meaning all the right sections of a tax return are completedReturn/refund estimates and calculators will let you know how much you can expect to pay or received based on ATO defined rulesExplanation of key terms and rules will increase individuals understanding of tax
Benefits of e-tax
On top of simplifying the whole process, people using e-tax in 2011 will benefit from faster returns compared to their paper counterparts; the ATO aims to have processed all electronic submissions within 14 days. There are also built-in checks and links to ATO resources to help prevent mistakes and ensure and accurate tax return. For your 2011 tax return, take the plunge and download the ATO e-tax software saving time, money and hassle with one of life's little chores.
Follow this link for more information on using 2011 e-tax.
http://www.taxrefundforfree.com.au/ has more information, links and resources to help you process your tax return
Patrick O'Sullivan reviews businesses, processes and ideas to find solutions and give advice in a variety of different situations.
Business owners are faced with the challenge of making profits in order to survive. The thought of having to pay taxes from your sales turnover can be very disheartening. However, this is a government regulation that cannot be avoided. Tax evasion is a serious crime that can actually run you out of business before you know it. It is therefore important to identify a qualified tax accountant to assist you in tax management.
The CPA accountant will must be paid a consultancy fee. This professional can come in at the close of every month to work out the business taxes. However, in order to make the process easy for the tax accountant, below are certain tips that one should follow.
Keep business recordsAny business that is run without business records is bound to fail. Record keeping is a key element of any business whether small or large. Income, purchases and expenses should be clearly indicated and receipts and invoices attached. With this information in place, it becomes easy for the CPA tax accountant to come up with the real monthly tax figure.
Update the books
Books of accounting have to be constantly updated so as to sure that the information is free and fair from any manipulation. There are those who choose to use accounting software packages. The data entered in these programs should be very accurate. Source documents should also be kept intact as they are vital when it comes to conducting the actual audit.
Income and charitable contributions
There are certain situations when one expects to receive income at the close of the month of December. Such income can be deferred to January of the coming year in a bid to benefit from an additional four months grace period. The deferred incomes should largely depend on your profit margins for that particular financial year. In case you have charitable contributions to make in the coming year, try to send them out in the present year and ensure that you pick the receipts.
Dealing with purchases and bills.
Come up with a projection of the amount of money that you intend to spend in the initial quarter of the year. Such purchases can be made prior to closing the year. Any bills should be offset early enough in case the cash flow will permit this.
Write-off obsolete goods
The particular accounting system that you use will determine whether it is safe to write-off all damaged and obsolete goods at the close of the year. It is also advisable for the CPA tax accountant to assist you in making retirement contributions.
If the following tips are followed, huge savings may become imminent after the tax consultant is through with the accounting and taxes remitted to the government. Since in business every cent counts, try to utilize the above mentioned tips to make savings.
Notably, these tips are applicable for both small and large business enterprises. It is worth noting that even small businesses require the services of a highly qualified and experienced CPA tax consultant.
Learn more about the topic in this article at Desert Rose Tax & Accounting.
Joseph Rose is a CPA in Tucson, Arizona. Mr. Rose is the president and founder of Desert Rose Tax & Accounting which specializes in small business accounting and taxes.
Starting To Think About Filing Your Expatriate Tax Return? Wait! Read This First: How to Save Money on Your US Expat Taxes
Living and working in a foreign country, whether it is temporary or permanent, can be a fulfilling and rewarding experience. Moving to another country, although exciting, does come with some challenges and requires that you learn a bit of new information as it relates to your US taxes. In order to reap the full benefits of living abroad you need to do some research regarding your expatriate tax return obligation before you need to file. No one likes filing their taxes, and certainly no one likes to spend money unnecessarily, so saving money is crucial. This article will provide you with four great ways to save on your US expat taxes.
Take advantage of the Foreign Tax Credit & Foreign Earned Income Exclusion
While you're living abroad and filing your US taxes, it is important to make sure that you take full advantage of Form 1116 and Forms 2555, otherwise known as the Foreign Tax Credit Form and the Foreign Earned Income Exclusion, respectively. The Foreign Tax Credit gives you a credit on your US expat taxes for the amount of money you have paid in tax to a foreign government. The Foreign Earned Income Exclusion helps you by excluding a big chunk of your foreign earned income from your US taxes. This is important because even as a US expat, all of the income that you make outside the United States is subject to identical tax rates as someone who is working and living inside of the US. That is where Form 2555 comes in. By completing this form, you can exclude up to $91,500 USD of income earned abroad from your US expat tax return. While including potential deductions of housing and living expenses, it is possible to counterbalance most if not all of your tax liability in a given calendar year.
The Foreign Tax Credit (or Form 1116) is different than Form 2555 but they work together to help you save money on your expat tax return. It is important to note that many people take a wrong turn when using these two forms by assuming their taxes will be offset by the numbers they have worked out, and they decide not to bother filing their expat taxes at all. Clearly this isn't going to do you any good! If you earn money abroad you will need to file in order to receive these tax breaks and avoid being hit with penalties.
Adjust your Foreign Housing Credit for the country you live in
A second tip for filing your US expatriate tax return is to make sure your Foreign Housing Credit is adjusted for the country you live in. The rates vary from country to country which can drastically affect the end result, so it is extremely important to make sure that this is adjusted. As a US citizen living and working abroad, you may be eligible to deduct some of your housing costs from your income in order to save some money on your taxes. In order to qualify for this deduction, you need to meet the "bona fide residence test" or the "physical presence test." This test ensures that you are indeed living and working abroad. The IRS allows this deduction because they recognize that you may need to spend more money on housing outside of the US. Generally, the deduction is for a maximum of $27,450 or 30% of your Foreign Earned Income Exclusion and you deduct this amount from your gross income for housing costs. As mentioned, this rate is adjustable depending on where you are living. For example, compared to living in the US, places such as London, Paris, Singapore, Hong Kong, Dubai and Perth all qualify for a much higher deduction rate than the standard rate due to the higher costs of living. By being aware of the changing rates associated with your country of residence, you could end up saving a lot of money!
Use the most advantageous foreign exchange rates
You can also save a lot of money by making sure that the accountant who is filing your expatriate tax return is using the most advantageous foreign exchange conversion dates. When filing your taxes, you can choose different foreign exchange periods such as annually or on a specific day. Making sure you make the right choice as to what period you choose can end up saving you a lot of money in the long run. For example, if you receive a $10,000 bonus on June 1st and the foreign exchange rate is lower than the monthly number has been, you may want to use the specific date to translate it into US Dollars (as everything needs to be filed in US dollars).
Don't get overcharged for your expatriate tax return preparation fees!
Finally, it is imperative to hire a qualified expert to prepare your US expat taxes and agree upon and pay one flat fee to the person who is filing your expatriate tax return so that you aren't surprised by the final bill. It happens all too often that expatriates believe they will be paying one amount only to be hit with extra charges and fees on their final bill. Many companies don't disclose their prices or they quote you one price only to have add-ons for each additional service. This obviously means that the tax bill can increase over the course of preparing the return, and you do not want to pay more than you can afford or more than you were expecting. You need to find someone you are comfortable dealing with and this likely means a company that has very transparent prices!
As you can see, there are numerous ways to save money on your US expatriate tax return. By understanding the credits and exclusions that are available to you as an expat, you can ensure that you are well informed and knowledgeable about the ways can save you money. For more information about how the various components of an expatriate tax return work please have a look at our new series Your Expat Taxes Explained.
About Greenback Expat Tax Services
Greenback Expat Tax Services specializes in preparation of US Expat Taxes for Americans living abroad. Incorporated in New York, Greenback's CPAs have 30+ years specialist experience in US expat taxes. We offer a flat fee ($329 for a federal return), simple process (we don't make you do all the work!) and, most importantly CPAs who are experts in the ins-and-outs of expat tax returns. For more information and to download a free guide to US expat taxes, visit http://www.greenbacktaxservices.com/
What is Patriot Asset Protection?
What does Patriot have to do with affordable asset protection and what would make it so affordable? We're living in a different world today because the old days of forming Corporations which are Federally Chartered demanding expensive CPAs to crawl all over your books 4 times per year to report every single facet of your business to carve off the government's share to send to them are coming to a close.
Everywhere you look today you see less and less INCs and more and more LLCs, and the best of them are anonymous LLCs sometimes referred to as invisible LLCs. The two most commonly known are the New Mexico (invisible) LLC and the Oklahoma Anonymous LLC.
Why the huge difference between Federal INCs and State Chartered LLCs?
In 1909, the Federal Government offered businessmen protection from losses over and above their investment with an INC charter. The cost of this charter would be a percentage of their Income Defined then as the remains of deducting all expenses from all Revenue. This indelible definition of Income in the Corporate Tax Act of 1909 is why there is no definition for Income anywhere in today's 9,500 page IRS Code Book. There isn't because there could not possibly be anyway that definition would apply to you as a person.
Four years later, the Sixteenth Amendment of 1913 which is the sole IRS authority only allows Congress to tax Incomes Derived from a Source. Is your paycheck Income Derived from a Source? There is a whole Blog devoted to just this at International Sovereign Services.info linked below.
How is an LLC an Affordable Asset Protection?
Our hats are off to the Legislators of New Mexico and Oklahoma who recognize that if our Fourth and Fifth Amendments mean anything, there needs to be Business Entities to support them. No state chartered LLC has IRS reporting requirements but New Mexico and Oklahoma go that extra step to protect ownership from their records as well. Our promoted Oklahoma LLC records only the name and address of the business LLC and its Manager(s.) The Manager(s) have full authority and may or may not be an owner. What Happens in your LLC Stays in your LLC...
Is Asset Protection through anonymous LLCs legal?
Our Fourth Amendment also known as the None of your business Amendment says yes:
The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized
Our Fifth Amendment also known as the I'm Not talking Amendment says yes:
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb, nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use without just compensation.
Asset Protection isn't legal advice
I am not an attorney nor CPA but I am like you, a Founding Child of our Founding Fathers and the First Amendment allows me to assemble here to talk to you about our Rights in our Bill of Rights.
Asset Protection based upon Oklahoma LLC Anonymity
The Oklahoma LLC provides its Certificate of Limited Liability and its Articles of Organization which are the documents to open a small business account in the bank of your choice. The Articles of Organization list the Manager(s.) It is typically better to list at least two managers. In this way you can apply for an EIN number as a multi-member LLC eliminating any possible confusion of an alter ego. The second Manager need not be on any of the Banking Accounts and can resign at any time using Minutes forever veiled and locked away in company records. Not even the State of Oklahoma requires an update of any change in management.
The Martha Stewart Asset Protection
Really? Because there isn't one! Remember, this innocent of any crime Motherly type was arrested, tried and imprisoned for just talking with the government. Did she forget her Fifth Amendment Right or just never learned it? My point here is that yes, the Oklahoma LLC is an entity of Privacy just like our Founding Fathers wanted for us but it will all mean nothing if you then start thinking you must answer questions from some government agent should this unlikely event ever occur. The Oklahoma LLC works best if at the same time you make application you repeat 100 times or more "I am not Martha Stewart and refuse to answer any questions." Loose Lips Sink Ships was the most famous WWll slogan.
There are few Good Asset Protection Strategies
Tax Evasion is a crime, Tax Avoidance is not. Strategies that avoid Taxes are your responsibility because you and your family rely upon you to know this. Yes, LLCs like any business can have reportable Sixteenth Amendment Derived-Income, but like any business can also generate millions in Revenue with nothing left after expenses; no Derived-Income.
LLCs who pay their Managers Income obviously not Derived from a Source is still a legitimate deductible expense that could eliminate any LLC profit. Paying the LLC Manager(s) sufficient Non Derived-Income to Avoid LLC profit is your decision and your choice. All of that money floating in and out of the LLC bank account you manage is not proof of LLC profit nor is it probable cause to demand your accounting. There is not even a need for expensive CPAs or outside accountants because today there are many good spreadsheet programs that you can use in-house with lock-tight encrypted security.
You can also later on add Off-shore Anonymous Entity umbrella strategies like Panamanian Foundations, Nevis LLCs and Hong Kong Corporations especially if you desire to trade out some of your US Federal Reserve Notes for other types of assets or global currencies you believe to be in less danger of hyper Inflation.
Click here to find your affordable Oklahoma LLC from http://www.anonymousposition.com.
Richard Brown a former US Marine keeping his life-long 1960 OATH to protect America from ALL enemies both foreign and DOMESTIC. He is a Super Researcher in entity Asset Protection, the Constitution with its Bill of Rights, our Founding Fathers and their History of Intent as it pertains to us all today as we, their Founding Children's Children. Richard has earned Expert Author Status from Ezine Magazine submitting articles from his Health Blog as well as many articles from his http://www.internationalsovereignservices.info/ Blog concentrated on the Sixteenth Amendment as well as the other two favorites, the Fourth & Fifth...
Just because one is an expat, does not mean they are exempt from taxation. However, that is the view that many have. They think that because they are abroad they do not have to pay United States income and state taxes. That is false, because as a United States expat abroad, you still have a legal obligation to file all your IRS forms for each year that you are earning income in the rest of the world. There are many places where one can find more information about exactly what percentage is owed depending upon early salary, profession and the area you are residing in abroad.
However, there are definitely perks to being an expat, because there are exclusions for people who stay aboard for more than 330 days out of the calendar year. They have the opportunity to exclude up to $91,500 of their yearly income. This was in effect in 2010, and the number has decreased slightly in 2011. In fact, if the couple is married and you are both abroad for 330 days, or more, then another $91,500 can be exempted from your combined incomes. However, it does not mean that you do not have to fill out your IRS forms. These people living abroad must still file their 1040 form otherwise they will not get an exemption and may have to pay other fines in addition to taxes that will be owed to the United States government.
Unfortunately, if you earn more than that specified amount you will have to pay taxes on it to the government. It does not matter if you pay foreign tax as well. Even if you are subject to taxation in the nation you are residing, on all or part of your income, you will still owe the United States income tax. However, there are foreign credits that can help offset the loss of paying the IRS and the country you are living in. Of course, if the country you live in has a higher rate of taxation you will get more credits, as opposed to countries where there is little or no tax that you must pay.
There are also treaties that the United States has with many countries around the world, about 60 to be exact. These taxation treaties have certain provisions that help United States taxpayers. They are aimed at reducing or even eliminating the double tax that occurs on your income. As a result, you may only be paying taxes to the foreign country, or only to the United States. That depends upon the treaty. The key is to always try and find the correct information online through the United States government websites or through an attorney in the United States. They will be able to properly assist you with your particular circumstances so you do not pay too much or too little and do not incur any penalties or charges.
Ricky Dean writes about various topics. For more info on expat tax rules or direct or indirect taxes, visit Dinosauric.
Service in a combat zone is tough, arduous duty. Being far from family, friends and comfortable, familiar surroundings is hard. Whether you serve in the Army, Navy Air Force, Marines, Coast Guard, active duty, reserve or National Guard you are entitled to a valuable tax break for your overseas deployment service to our country. Its called the Combat Zone Exclusion and its important for you to be informed about it.
Much of your pay, especially while deployed is tax free. For enlisted personnel and warrant officers, your base pay is tax free when you step foot into a tax free zone. It applies to the entire month. So if you step foot into the zone on the last day of the month, the entire month's base pay is tax free! There is a misconception by many service members that the tax free pay was changed to a day-for-day rate, meaning you only got tax free pay for the days you were actually "downrange" but, it is just that - a rumor. The only catch is that for higher ranking officers your pay is only tax free up to the pay rate of an E-9. Any pay above that rate is not tax free. Your Leave and Earnings Statement (LES) and your W2's will reflect the correct taxable income amount for Federal Taxes: lower than what you actually got paid. That is, if your administration or disbursing offices are doing their job correctly. It's very easy to claim this income exclusion. Since your non-taxable pay is not included on your W2's you do not have to check a box or fill out an additional form for your return. Just report the wages shown on your W2's on your tax form, usually the 1040.
Some other pay that is similarly non-taxable pay includes imminent danger and hostile fire pay, re-enlistment bonuses for agreements signed in theater and leave accrued in theater. Of course, your Basic Allowance for Subsistence (BAS) and Basic Allowance for Housing (BAH) are not taxable whether you are in a combat zone or not.
So where are the current, tax free, combat zones? Afghanistan has been considered a combat zone since September 19th 2001. Yugoslavia and Albania were designated combat zones on March 24th, 1999. The Persian Gulf area (also called the Arabian Gulf) has been a combat zone since January 17th 1991. The Persian Gulf area includes The Persian Gulf, The Red Sea, The Gulf of Oman, The Gulf of Aden, Iraq, Kuwait, Saudi Arabia, Oman, Bahrain, Qatar and the UAE. The combat zone also extends into the airspace above all these areas.
We have all heard the stories of the General who commandeered a plane just to fly over hostile territory to get his tax free month but it is not "supposed" to happen. Contrary to popular belief, you cannot get the combat zone exclusion if you are just using the space to travel from one point outside the zone to another point outside the zone, if you are in the combat zone while on leave from a place outside the zone or if you are just there for your personal convenience.
Serving in a combat zone can be a rewarding experience. There are lots of opportunities for personal and professional growth. Friendships you forge there will last a life time. It can also be financially rewarding. To learn more, consult IRS Publication 3, Armed Forces' Tax Guide.
David Guild, MBA
Owner, Patriot Accounting LLC
http://www.patriotaccountingllc.com/
We've been experiencing some hard times for homeowners with foreclosures rampant, high unemployment, falling home prices, creative financing options kicking in, and mortgage payments which go up instead of down. As a parent or a grandparent, you may have felt it necessary to help the younger generation meet their financial obligations by pitching in and paying one or more mortgage payments for them. At the same time, you may wonder if the interest that you are paying for them can be used as a deduction on your income taxes. Although this type of interest generally isn't yours to claim, there are ways in which you can change the rules.
The main consideration is about who is liable for the loan. If it's in your child's name, then it isn't considered to be your liability. Therefore, you need to actually share the house with your child before you can share the liability. Of course, by doing so you are also assuming total liability should your child have to forego his or her own claim to the property. In other words, you could end up holding the financial bag of paying for a second property that technically isn't yours. Therefore, you need to think hard and long before you accept any permanent responsibility for your child's debts.
Another factor to think about is that if you won't have enough deductions to file for itemized deductions and will only be claiming the standard deduction on your income taxes, then there's really no point in becoming liable for your child's obligations. You can still help out if you want to, but you don't have to take on the responsibility for the loan, because you won't be able to claim the interest anyway. In order to file itemized deductions, you need to have enough qualified expenses during the year to meet the government threshold. Some of the other things that can be deducted are your own mortgage interest payments, medical expenses, and property taxes.
While it's commendable that you wish to help out your child when he gets into financial trouble with his mortgage payments, it isn't usually feasible to think that you'll be able to get a kick-back in the form of a tax deduction for the interest you are paying. Talk with your tax consultant to find out if you can qualify for any deductions as the result of your financial assistance in behalf of your child.
Mortgage companies in the Madison, Wisconsin area are not hard to come by. Quality mortgage companies can be difficult to find. For the lowest rates and never any hidden fees, visit Easy Mortgage Company's site here: mortgage broker Janesville WI or at mortgage brokers Madison.
Time is increasingly becoming vastly more important to us than the money we earn. Think of all the things we have to accomplish every day, and weigh them against all the things we want to do, and how in order to do it all we have to get pretty creative. Top that off with the feeling that every day seems to be shortening each year, and it is a wonder we get through it all. Then along comes technology to rescue us from at least one dreaded task that we cannot escape, once a year. But by allowing e-filing income tax, it becomes one less task staring at us from that long to do list.
The benefits of income tax e-filing are twofold -- you are done filing your taxes rather quickly, for one thing, and at the same time you are doing your part to spare the environment a loss of more trees. The Internal Revenue Service forms are readily available online, and the steps to filling them out are simple enough to complete on your own, anytime and anywhere, as long as you are near a computer with access to the web. The more popular it becomes, the more simple the IRS will make it, until it becomes THE filing avenue of choice for most taxpayers. The best advice, therefore, is getting to know how to file electronically, because the day may be just around the corner where you will need to know the how to of e-filing of income tax.
Why go through all the trouble of learning how to e-file? Is it the fact that you will save time? Is it the assistance the tax forms provide in the way of prompts? There is the research needed to figure things out, then there is remembering which paperwork is needed, and where to send it, and when. Along came the software designed to eliminate all these difficulties and confusion. FreeFile, for instance, is supported by the IRS, and can do as the name suggests: help you file for free and take the time consumption out of it. Gone are the days of endless hours and mountains of paperwork to sift through, organize and process.
Software takes the guesswork out of all those calculations that used to produce headaches before there was e-filing, back when you needed to bring in the troops to figure them all out. An added bonus is that software will be easily updated year after year, to keep up with all the changes to the tax laws. There will be no miscalculations or missed exemptions, and there will be no bill from a tax preparer.
There are many online resources for self-preparing your taxes online, or using software that will guide you through. So, individually, there is no longer any excuse for setting aside the tax preparation companies and rounding up the courage to get it done on your own. Once you are there, head over to the IRS site and learn how easy e-filing income tax really is.
Visit Art Lynch's blog at http://www.incometaxesonline.org/ for timely information about tips for income tax e-filing. There's also good information about free tax filing.
If you are a foreign resident taking up employment in Australia it is strongly recommended that you seek expert advice on your Australian Taxation obligations. Expatriates working here will usually be liable for income tax on their Australian sourced income. This not only includes wages and salaries, but also interest and dividends that have their source within Australia.
Whether you are a resident for Australian income tax law will depend on your circumstances and this needs to be reviewed on a case by case basis.
If you are required to pay Australian income tax, it is important to note that the Australian tax year concludes on 30 June, and you will need to lodge an income tax return by 31 October. If you engage a tax agent or accountant they are eligible for lodgement extensions.
There are also a number of considerations that an expatriate needs to understand when negotiating their employment contract and also to legally minimising their tax. These include (but are not limited to):
Certain types of benefits can be "salary packaged" and result in significant tax savings. The two most common ones available to expatriates are the living away from home allowance (LAFHA) and motor vehicles. The LAFHA is designed specifically for expatriates to compensate for the additional costs of moving residency and provides for a tax break for food and rent. Motor vehicles can also be packaged and can often result in less tax being paid.Expenses incurred in deriving your income can also be claimed. For example depreciation on your notebook, stationery, internet and professional subscriptions can often be claimed and this will in turn reduce your taxable income. It is good practice to retain receipts for all items of expenditure that you would like to claim as a tax deduction. There are harsh penalties if you get it wrong.There are also a number of tax offsets or rebates that can be claimed to help reduce your tax. You will need to consult a tax expert to assist you with their eligibility.Australia also has a compulsory superannuation system, whereby your employer is required to contribute a percentage of your income into an Australian registered superannuation fund. There are some limited exemptions to this for expatriates, but if you find your employer making these contributions you can claim these back if you were to permanently leave Australia.
The key Australian tax rates for 2011/12 are outlined on Australian Tax Website http://www.ato.gov.au/.
Greg Newbury is the director and partner at Accru Felsers chartered accountants and business advisers in Sydney. Accru Felsers specialize in international tax for German subsidiaries in Australia and their staff who have relocated here. If you would like assistance with your tax affairs, please contact Accru Felsers on 02 8226 1655.
Accru can provide you with expert advice on business accounting, tax, audit, business management, outsourced accounting, international tax, financial planning and litigation support. Keeping this in mind, as a chartered accounting firm catering to every size and type of business, no job is too big or too small. Their business in Australia is based on "putting people first" and that is their affirmed point of difference.
NOTE: The key Australian tax rates for 2011/12 are outlined in this Tax Data Card produced by Accru Felsers Chartered Accountants on their website.
In 1936 California began requiring corporations which were controlled or owned by the same interests to file a tax return combining the operations and net income of all the entities within the group. A formula was then applied to the net income to apportion the income to the operations located within California. Thus, California could levy their tax on the net income deemed to be earned by the business in California.
This system evolved from a similar method of taxation imposed in the late 1800's. When the railroads came out West the state sought to charge them property taxes, not just on the value of their track located within the sate, but also on their property located elsewhere. The state devised a method which involved determining the entire value of the company's property located everywhere and then applying a factor with the numerator representing the miles of track located within the sate and the denominator the total miles of track. This system worked so well it was expanded to include telegraph, telephone and express companies.
Various court cases upheld this approach to taxation. One of the early cases was a United States Supreme Court case, Adams Express Co. v. Ohio, 165 U.S. 194 (1897), which permitted the company to be valued as a unit because a common purpose existed for the entire property. In Fargo v. Harte, 193 U.S. 490 (1904), the Court defined the property permitted to be included in the formula specifying that any non-business property should not be included. The actual formula method was upheld by the Supreme Court in Underwood Typewriter Co. v. Chamberlain, 254 U.S. 113 (1920).
California became the most aggressive state in using the unitary method of taxation. It was assisted by a major victory in the California Supreme Court, Butler Bros. v. McColgan, 17 C. 2d. 664 (1940); aff'd 315 U.S. 501 (1942), which established a test for determining whether a business is unitary. The test includes three items:
1. Unity of ownership
2. Unity of operations as evidenced by central purchasing, advertising, accounting and management decisions
3. Unity of use in its centralized executive force and general system of operation.
If any of these are present, a unitary business exists and combined reporting is required.
A further significant case is Edison California Stores Inc., 30 C. 2d. 472 (1947), upholding the combined reporting as a reasonable method of determining the tax and also extended the method to apply to separate corporations operating in several states in interstate commerce but under common ownership, management and operations. The most recent case was the 1983 United States Supreme Court case, Container Corporation of America v. Franchise Tax Board, 103 S Ct 2933, upholding the constitutionality of the unitary method.
Stephen Sears is a Certified Public Accountant (CPA) and an investment advsior with a Masters degree in Taxation. He has a Bachelor's degree in Business Administration. He is the principal of Stephen Sears - A Professional Corporation. Mr. Sears has been the featured speaker at hundreds of seminars and has been interviewed countless times on television and radio.
Many contractors who have savings or hope to begin saving and would like to increase the potential return on their investment on savings, should have an Individual Savings Accounts (ISA's). The current maximum that can be placed into an ISA is £10,680, of which £5,340 can be in cash. The other £5,340 can be used for shares. Although the maximum £5,340 has been set for cash, there is no limit within the £10,680 for shares.
Many people may be confused how ISA's are structured and how they can bring such great tax relief for such large chunks of savings, keeping large amounts of money away from the tax man. But a simple meeting with any local branch advisor will help explain and choose the best suited ISA for your individual needs and requirements. Recent finding by the HM Revenue & Customs (HMRC) has shown that aside from the fact that many still don't understand how beneficial having an ISA can be there is currently 15.3 million active ISA accounts. The most since the introduction of ISA's in 1998.
All contractors should consider an ISA as their first choice for ultimate flexibility for investments, as having instant access to savings can be an attractive prospect especially for contractors.
For contractors there are many types of ISA's to choose from:
Cash ISA's: Many will have variable rates of interest depending on the access required. ISA's can have instant access at the teller, online and by phone but may have low rates, whereas fixed rate ISAs are available with higher rates but may require less flexibility and a possible fine for early withdrawals. But are great for short term and free from any fluctuations within the stock market.
Equity ISA's: The opportunity to invest money in a managed fund or chose to make individual decisions on which companies to invest in. There are different areas that managed funds invest in, these are international equity funds, commercial property and corporate and treasury bonds. But beware as stocks and shares ISA's can be considered long term (5+ years) and the investment can fall below the contractors initial instalment as the markets fluctuate.
With contractors facing challenges from the HMRC, with tax, IR35, IR56 compliance and expenses being required it is vital to make use of all available tax breaks that are still available. It is also recommended to use an umbrella company to help process your payroll and maximise your income through using their tax expertise, keeping you on the legal path. Whilst reducing the worry and complexities that are involved with all the legal issues.
Harvey McEwan writes to offer information amd advice on a variety of areas, from technology to holiday destinations. Read through Harvey's other articles here to find out more.
At some point in your life it is likely that you will have at least one IRS audit on your income taxes as a business owner or when working self-employed. You can minimize the chances of getting one but you should always keep proof of all your business earnings and expenditures every year and keep them for at least six years afterwards. This is considered as good accounting.
Tax returns will be flagged by the IRS computer if it seems that your deductibles are too high. There is also a random selection process, which you will not be able to do anything about. However, you can prevent yourself from being put into that category for the random selection by keeping note of all your business spending. Another reason why you could be flagged is if your income is paid through cash.
Problems with the math are often a reason why people are selected for audit and you could help yourself by having an expert do the tax accounting for you. Of course, if you do it all yourself, you will need to make sure that you add and subtract correctly.
You will also need to make sure that interest is added up right and that the documentation is filled out correctly. Always, always, always double-check your documentation whether you think it is right in the first place or not.
You will need to report the numbers to the IRS and on your tax forms correctly so you should ensure that these numbers match completely. This will always bring up the red flag if they do not and it is up to an auditor to find out why they do not match. You should fill out your 1099 form completely and verify all of the amounts that you are filling in.
You need to be aware if you do business in cash. This is harder when it comes to accounting tax because there is very little documentation. It tends to pull up the red flag very quickly and will have the auditors knocking on your door. You also run more of a risk if you are self-employed or run a small business.
You should always watch who you talk to about your tax, especially if you are avoiding it illegally. People who call the IRS about you are able to receive 30 percent of the money that is collected off of you at an audit, which can be a large amount if you have been avoiding tax for a number of years. Avoiding tax is illegal and should not be done but if you are doing it, just do not talk about it.
To really avoid an IRS tax return audit, you should report all of the income that you earn and look into the legal ways of avoiding paying tax. There are a number of them out there. If you do have an accountant, they will be happy to share some of the best ways of saving money and earning more profit that you can keep hold of.
Learn more about the topic in this article at Desert Rose Tax & Accounting
Joseph Rose is a CPA in Tucson, Arizona. Mr. Rose is the president and founder of Desert Rose Tax & Accounting which specializes in small business accounting and taxes.
Question:
I was working in Russia until June 2010 after which I came and started full-time employment in Cyprus. I have paid 13% Russian income tax on my remuneration in Russia.
Will I have to declare and pay any income tax in Cyprus on my Russian income and on what basis my Cyprus remuneration will be taxed?
Answer:
Thank you for your question.
Since you have accumulated over 183 days in Cyprus during 2010, you are de facto Cyprus tax resident and will be taxed on your worldwide income according to Cyprus Income Tax Law. Furthermore, you will have to file your Income Tax Return with the Cyprus Inland Revenue Department (IRD) by 30th April 2011. Applicable to your case are the Cyprus Income Tax Law 118(I)/2002 and the 1998 Treaty between Cyprus and Russia.
Now, let's move to the practical side of your situation by going through what you have to declare and what will be taxed.
Firstly, when filling in your Income Tax Return form IR.1, Part 4(A1) you will have to declare the name of your Russian employer, state that the income you received was from sources outside Cyprus (while working for a non-resident employer), the number of months in Russia, the gross income received and the tax withheld. Likewise, you will have to complete the same type of information for your Cyprus employment, this time indicating that income was derived from source in Cyprus and that you were non-Cyprus-tax-resident before. Finally, in completing Part 4(A2) you will have to indicate the date when you came in Cyprus, the date when you started your employment and the aggregate number of days you resided outside Cyprus before starting employment.
Secondly, there are two income elements in your case: income from employment in Russia, which was already taxed at 13% and income from employment in Cyprus. The first element of your income, the employment income in Russia, will be tax exempt as per Art.36(5) of the Cyprus Income Tax Law (i.e. the "90-days rule"). That is to say, it will not be taken into consideration when computing your tax liability and you will not pay Cyprus tax on the Russian employment income element. As regards the Cyprus employment income, it will be taxed at the progressive tax rates as per Art.25, Schedule 2 of the Income Tax Law.
We need to make a side note here, and say that if the income you received from Russia was not from employment but from other non-employment services, then you will be allowed to claim tax credit in Cyprus for the amount of tax paid in Russia, according to the 1998 Tax Treaty between Cyprus and Russia (Art.23(2)) and subject to the provisions of the Cyprus Income Tax Law.
Finally, those taking employment or office in Cyprus for a first time should remember that the Income Tax Law provides 20% exemption (with a maximum of ?8,550) on the remuneration received in Cyprus for a period of three years starting 1st January following the year when employment commenced.
Veronica Goncharenko
Quantia Advisors Ltd.
Chartered Certified Accountants
http://www.qnta.biz/
Did you know that the Internal Revenue Service (IRS) charges a processing fee through third party providers for people who pay their taxes with a credit card? According to a recent FreeScore.com survey of 1,000 Americans, 68% are unaware of this IRS processing fee of 1.90 percent to 3.93 percent.
Further, the release reports that 66% of Americans who are planning to pay their taxes with a credit card already have a balance on the card. Adding a processing fee to an existing balance can easily increase the total amount paid for taxes. Additionally, a mounting outstanding credit card balance has the potential to severely hurt your credit scores and future buying power. Further, income tax debt is a debt that bankruptcy won't pardon.
The IRS's website states: "The Taxpayer Relief Act of 1997 authorizes the Treasury to accept these (credit card) payments for federal taxes but prohibits the IRS from paying a fee or consideration to service providers for processing these transactions." So, unlike your friendly shopping store that will cover your credit processing fee, the IRS makes you pay.
To provide taxpayers with the option of charging their taxes, the IRS has non-monetary contracts and agreements with service providers.
Also from the IRS site: "The service providers act like merchants and are necessary intermediaries in transaction processing. The service providers validate card numbers and expiration dates, obtain authorization from the card issuers and issue confirmation numbers to taxpayers at the end of the payment transaction. The service providers forward tax payment information to the IRS for posting to taxpayer accounts."
Due to these processing fees and credit interest rates that come with using a credit card, if you don't have the cash to pay your taxes and are thinking about using this plastic option, take some time to consider all of your options first.
For example, I recommend comparing the interest rate that the IRS will charge you for late payments versus the interest rate on your credit card. Or, see if you have a relative who'd be willing to loan you the money interest-free if you paid it back within a reasonable amount of time. The point is, paying with a credit card in many instances should be a last - not a first - resort.
No matter what, it is important that you send in your tax return form in on time. If you can't pay, the IRS will work with you to set up a monthly payment plan. Interest will be charged on any tax not paid by its due date, until the account is fully paid. You will also be charged a late penalty fee. The IRS website suggests considering a possibly less costly alternative like taking a loan out from a bank.
With the three-day tax return deadline extension this year because of Emancipation Day, you have three more days to figure out an alternative to paying your taxes with a credit card.
Link to IRS processing fees and payment rules and regulations: www.irs.gov/efile/article/0,,id=101316,00.html
Carrie Coghill is the Director of Consumer Education for http://freescore.com/. She has co-authored two books on personal finance, "The Newlyweds' Guide to Investing & Personal Finance" and "What's Your Investing IQ", and contributed to a third work, "Getting Started in 401(k) Investing."
April 15th has traditionally been the last day of the year to file taxes. However, due to Emancipation Day falling on April 15th most state and federal individual income taxes can be filed by April 18th. There are many solutions for filing taxes on time. There are online tax programs that will allow for filing taxes in the comfort of home. However, filers should always attempt to pay their taxes by the deadline. Tax payers need to be aware that a variety of penalties can be issued to those who do not file on time.
Computer programs such as TurboTax and H&R Block make it convenient to file taxes from home. With step by step instructions these programs are easy to use, and guarantee that tax payers will receive the maximum tax refund. Some of these tax programs are free for federal tax filings, and some charge a small fee for filing state taxes. TurboTax and H&R Block online tax filing programs are a great way to file taxes by the April 18th deadline.
Filing online will save time and money. Since taxes can be completed at any pace, filers will not have to take extra time attending an appointment with a CPA. There also will not be any fees to pay for services rendered by an accountant. Although these programs make it easy to file at their own pace, it is extremely important tax payers remember to file on time, or file for an extension on time.
Assistance is available for any questions filers may have. The online professional tax assistant can be contacted via email, phone, or chat. These tax experts can also help with complex tax situations such as audits, and filing extensions. Those who do not file their returns on time can expect to be penalized up to almost 50% of their unpaid taxes. Online tax services help ease the tax season burden.
Computer tax programs provide a solution for those with returns that will not be ready to be filed by April 18th. The IRS allows a 6-month extension. Online services can be used to file for the 6-month tax extension. Tax payers should be aware that even though they are filing for an extension they will still need to pay on time. This date is usually April 15th. However, due to the Emancipation Day holiday the date has already been extended to April 18th. Extension filers must estimate and pay the amount they will owe when filing for the extension. Tax payers should also be aware that if they do not send at least 90% of the estimated payment they will be charged a late payment penalty. Exceptions will be made for US citizens or resident aliens whose main place of work is abroad (outside of the United States and Puerto Rico). Those who are overseas because they serve in the military also will not have to file for the extension. These filers have the extra two months to file without requesting the extension. Although there will usually be a charge, this may be the best option for some.
This gifted author gives interesting resources about Tax Software Coupons. You can learn pertinent hints to help you maximize your tax filing with deals on Tax Extensions and more.
One of my favorite tax arguments is:
"Why do they always use High Profile Cases To Scare Us Into Paying Taxes"
When it comes to the IRS getting people to pay up, they usually use high profile cases to scare us into paying. One such case is the recent trial involving actor Wesley Snipes. For anyone looking to avoid paying taxes, all you need to do is hear his name and suddenly you realize "oh no, I better pay up or risk going behind bars!" While there are consequences for not paying your taxes, one must look deeper into this case to see why he ended up in the slammer. First off, he did pay his taxes. Yes, he had money with-held from his movie checks and did pay into the system. Then why did he go to jail? He went to jail because his accountant found a way to get him a full refund of all the money he paid in. This worked at first only to horribly backfire. In his case, it was the thought of getting a full refund based on a "tax protest" loophole which doesn't really exist that put him away. To top it off if he would've just left it alone he wouldn't have had to pay all the interest and penalties that were added to his total bill. The worst part about his case is his career as an entertainer allows for plenty of deductible expenses that would've legally gotten him a refund, but he got greedy and paid the price.
Another famous case is notorious mobster Al Capone. This is the biggest scare tactic since anyone who hears the name Al Capone thinks of hundreds of felonies from bootlegging to murder, however, despite his criminal spree it was tax evasion that put him in Alcatraz. In this case, it induces fear into the masses of trying to legally circumvent the tax code as they know that someone who blatantly engaged in so many illegal activities met his fate from not paying his taxes.
So what's the big deal anyways? Tax professionals know that there are many legal loopholes that don't involve filing for unnecessary refunds or just avoiding taxes altogether. Even if you are behind on your taxes, it is to your benefit to see a tax professional as soon as possible to become compliant. Best of all, there are many avenues you can take to avoid the hefty penalties and in some cases can pay in installments or even complete an "offer in compromise" which is where you can negotiate with the IRS for a fraction of what you owe. These cases are rare, however, they require the knowledge of a licensed professional and it is strongly recommended that you do not go at it alone or with an amateur.
Clint Masser
Licensed Tax Patriot & Director of Marketing
Jefferson Franklin Tax Services
Goodyear, AZ
Working on tax returns since 2006, Clint is currently a licensed tax professional in the process of studying for the Enrolled Agent exam. All of his work has been performed under the guidance of his father, a CPA/Enrolled Agent with over 30 years of experience who has provided tax preparation services and tax strategies for everyone from minimum wage employees to multi-millionaire business owners.
Why would anybody want residual income?
Who in their right mind wants to receive money month after month after month for work they did once?
Who do they think they are? Authors? Rock stars? Inventors?
What is residual income? Well I gave you the answer already.
Residual income, which can sometimes be known as royalty payment, is an ongoing payment that a person receives for work or effort that was done once. The most common concept of residual income is the royalty payment an author receives every time a person buys a book the author wrote, or a song writer for a song composed, or a singer for a song sung.
Did you know that Elvis Presley is the highest royalty earning singer today and he has been dead for over 30 years?
So, if you could earn a residual income from your employer for the work you did for him/her/them today would that make you more productive? The answer is probably yes. The only problem there is that you would be making the employer richer while you received a small remuneration for your efforts.
WHAT IF:
You could have all the time you wanted to do whatever you wanted?
You could have all the money you needed to do whatever you wanted?
You could show people how to save money on their essential services bills?
You were paid a small percentage of their bill each time they paid their bill?
You could show someone else how to show people how to save money on their essential services bills?
You could show that person how to make some money helping people save money?
The person you showed how to help people save on essential bills received a small percentage of their customer's bills each and every month?
You received a smaller percentage of that person's customers' bills each and every month?
You were allowed to have more than one customer?
You were allowed to help more than one person?
You could develop your business around the world - from your own home?
There really was this fairytale opportunity out there?
WOULD YOU:
Ask how you could find out more about this opportunity?
Give up an hour or two of television a few nights a week?
Be prepared to listen and learn, i.e. be coachable?
Think of others before yourself?
Help others make more money from their efforts than you
Talk to everyone you know to help them become financially and time free?
FAQ's
How could this be possible?
How much time do I need?
What is it going to cost?
Can I do it?
Is it legal?
Is this a reputable company?
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About the Author
David Morris is an accredited workplace trainer who is now using that experience to guide others to independent business ownership. He is associated with the world's leading direct marketer of telecommunications and essential home services. If you would like answers to your questions contact me by clicking on our website http://www.soaring2thetop.com/
The United States of America finds itself at a fiscal crossroads on a path that everyone can agree is unsustainable. That unfortunately is where everyone seems to stop agreeing. Looking at income taxes for the wealthy it is fact that from 1936 until 1982 the top tax rate was 70% or more. In 1982 it went down to 50% until 1987 when it went down again to closer to current levels. Despite the drop in the top tax rate during this time, the top 20% have been paying a larger and larger share of the total income tax paid in the US, but this is only fair in my opinion because they have been earning a larger and larger share of total income. This discussion is dealing with Income Tax, so arguing about other taxes paid does not address this topic. This is not about Capital Gains, Estate, or Use taxes; this article is about Income Tax.
When one looks at total revenues for the United States, the biggest revenue is for Personal Income Tax. If you want to resolve a fiscal crisis the size of the one the United States currently finds itself in, you have to look at the biggest sources to make adjustments. Corporate Income taxes are so small as to be found irrelevant for this discussion. As a matter of fact I would encourage that Corporate Income Taxes be abolished in the United States, if and only if the proposal for funding healthcare in this article is implemented. Otherwise, I believe that a Corporate Income Tax of 8.55% that cannot be reduced in any way should be implemented.
After a serious look at the total Revenues for the United States, it is clear that taxes alone are not going to be able to close the debt that we have created. Outlays will most definitely have to be cut, along with tax increases.
First, I think all expenses have to be put into perspective with the rate of inflation. For this, I use the CPI-U.
CPI-U means the index of consumer prices developed and updated by the US Department of Commerce. As referenced in section 1927(c) of the Social Security Act, it is the CPI for all urban consumers (US average)
The CPI-U average from 1914 through 2010 is 3.37%. The CPI-U from 1990 through 2010 is 2.75% and from 2000 through 2010 is 2.49%.
Using these numbers, it is not unrealistic to put the annual increase of outlays at an average of 3%, but the reality is far from that. For the argument that this is unrealistic, I submit the argument that the average American has to live with the real world factors of the CPU-I and it is not asking too much that our government, which is funded by us, to live within those same numbers.
For the US average wage, I am using the National Average Wage Index calculated by the Social Security Administration. From 1951 to 2009, the Wage index has increased from $2,799.16 to $40,711.61. That is an average annual increase of 4.49%. For the years 1990 through 2009, it averaged 3.45% and from 2000 to 2009, the annual increase averaged 2.84%.
Discretionary Outlays.
Our total Discretionary Outlays have increased from 122.5 billion in 1971 to 1,349.2 billion in 2010, a total increase of 1101%. I want to break it down a bit to show when the huge increases occurred. From 1971 to1980, it increased 226%, from 1981 to 1990, we saw an increase of 163%, from 1991 through 2000, it increased 115%, and from 2001 to 2010, we saw an increase of 208%. Dollars were 122.5 billion to 276.3 billion for '71 to '80, 307.9 billion to 500.6 billion for '81 to '90, 533.3 billion to 614.6 billion for '91 to 2000, and 649.0 billion to 1,349.2 billion for 2001 to 2010.
To try to go back and adjust spending beyond a 10-year mark would be so devastating to the government and the economy that it is a non-starter. Because of this, I will us a 10-year model of adjusted spending.
Defense outlays have increased 225% from 2001 to 2011. It should increase by a maximum of 3% a year. In dollars, it went from 306.1 billion to 689.1 billion. With all the wars from 1971 to today, it has increased by 872%. In 1990 during the first gulf war, it was 300.1 billion. The cost of the current wars is about 2 billion a week or roughly 104 billion a year, so why the huge increase in Defense spending? It has increased by 483 billion a year since 2001. With the ongoing wars it should be reduced by allowing a 3% per year increase over the past 10 years and adding in the cost of the wars, (93.29 billion plus 104 billion), 197.3 billion over the 306.1 billion of 2001. That is 503.4 billion a year for defense, so let us be generous and round it up to 504 billion with a 3% per year growth cap. That would save 185.1 billion a year.
International outlays have increased 204% from 2001 to 2011. In dollars, it increased from 22.5 billion to 45.9 billion. While the American people saw the average wage increase by only 1.27% from 2000 to 2009, we increased our international outlays by more than 202% above that. It should be capped by 3% annually, which in dollars is an increase from 22.5 billion to 29.3574 billion. If we round up to 30 billion a year it is a savings of 15.9 billion a year.
Domestic outlays have seen the same type of unreasonable increases, going from 320.4 billion in 2001 to 614.2 billion in 2010. That is an increase of 192%. Applying the same 3% annual increase cap from 2001 levels, it should go from 320.4 billion to 418 billion. Giving the generous round up I applied to the other outlays it would be 420 billion a year with a 3% annual increase cap. That would save 194.2 billion.
The total savings from Discretionary outlays is 395.2 billion a year.
Now we turn to Mandatory Outlays.
Mandatory Outlays have increased by 2620% from 1971 to 2010, or from 72.9 billion to 1,909.6 billion per year. I will break it down in 10-year chunks. From 1971 to 1980, it increased 414%, from 1981 to 1990, it increased 188%, from 1991 to 2000, we saw an increase of 160%, and from 2001 to 2010 it increased 190%. Dollar figures for those periods are 72.9 billion to 262.1 billion for '71 to '80, 301.5 billion to 568.1 billion for '81 to '90, 596.5 billion to 951.5 billion for '91 to 2000, and 1,007.6 billion to 1,909.6 billion for 2001 to 2010.
Social Security outlays have increased 163% from 2001 to 2010. In dollars, it went from 429.4 billion to 700.7 billion. Our debt at the end of 2010 was over 13 trillion dollars. Given the vital importance to individuals on fixed income, changes to this outlay are very hard for me to justify, but I do not know if it is possible to close the 2010-budget deficit of 1.3 trillion and pay off the debt without changes to this metric. If we were to apply the 3% per year cap, it would break down to going from 429.4 billion per year to 560.3 billion, giving an annual savings of 140.4 billion. I want to see if we can get that from other places and leave this alone.
Medicare outlays have increased from 2001 to 2010 by 219%. The dollar amount of that increase is from 237.9 billion in 2001 to 520.4 billion in 2010. Applying the standard 3% per year increase would take the outlay from 237.9 billion to 310.4 billion. If we apply the generous rounding to 311 billion per year, it would cut 209.4 billion from the budget.
Medicaid outlays saw an increase of 211% from 2001 to 2010. Total dollar amounts are increased from 129.4 billion in 2001 to 272.8 billion in 2010. 3% per year increase adjustment takes it from 129.4 billion to 168.8 billion, with a rounding up to 170 billion. That would give us a savings of 122.8 billion a year.
Income Security outlays have increased from 2001 to 2010 by 306%. The dollar value of this increase is from 143.1 billion to 437.7 billion. Since this category included unemployment payments, that can be pointed to as the primary driver of the increase. Applying the 3% per year increase, it would make the increase from 143.1 billion in 2001 to 186.7 billion. This would provide 251 billion per year in savings.
Other Retirement and Disability outlays have increased by 149% from 2001 to 2010. In dollars, it moved from 93 billion to 138.9 billion per year. This category includes retirement for military and government workers, and like Social Security, my personal opinion is that it should not be touched. With that in mind, the 3% per year increase cap if applied would amount to going from 93 billion per year to 121.3 billion. Applying my rounding it would come to 122 billion per year and provide a potential of 16.9 billion per year. I also want to see if we can protect this outlay by getting the savings from other areas.
Other program outlays have decreased from 64.5 billion in 2001 to 23.3 billion in 2010. Obviously, this outlay provides no opportunity for saving from the budget.
The total savings from Mandatory Outlays is 475.3 billion not counting the retirement outlays. If there is no other way to find the savings it could be increased to 632.6 billion a year in savings.
Closing the deficit and Paying off the DEBT.
With changes to how we pay for healthcare.
Total ethical outlay savings is 870.5 billion a year. Of course if we were to implement my changes to healthcare we would cut a total of 793.2 billion from the Outlays budget, a new Income and Outlays budget would need to be created for public healthcare, but that should be operated independently from this budget. If the healthcare changes are implemented the total outlays savings in my plan would be 1,663.7 billion dollars per year. The current annual deficit for 2009 was 1,294 billion dollars; these cuts along with the healthcare changes would provide a surplus of 369.7 billion per year. To pay off the debt of 13,164 billion at the end of 2010 in a 10-year plan would require us to pay down 1,316.4 billion per year. Add the budget cuts to that and we need to increase Revenues by 946.7 billion per year.
Without changes to how we pay for healthcare.
Considering that, economists have projected that unemployment will not recover for the next 5 years; we have to look at the tax revenues we have currently. The current deficit is 1,294 billion dollars and the savings described are 870.5 billion, leaving a deficit of 423.5 billion per year. Considering the debt of 13,164 billion at the end of 2010, we should set a 10-year reduction plan. To pay off the entire debt we would have to pay down 1,316.4 billion per year. If you added the 423.5 billion still needed to make the annual budget balance, we would have to increase the revenues by 1,739.9 billion per year. The total revenues for 2010 were 2,161.7 billion and paying off the debt in 10 years would require an almost doubling of the current tax revenues. I will figure for 10, 15, and 20 years.
Flat tax increase.
With my healthcare plan.
For 10 years, the total revenue per year would require 3,108.4 billion, which is an increase of 143.8%. So when you do your taxes you would take the total tax, (1040a line 37, 1040EZ line 11), and multiply by 1.438. The US median household income for 2009 was $49,777, with the median adjusted gross income of $33,048. The standard deduction for a single person is $9,350 and for married filing jointly is $18,700 giving a taxable income of $23,698 for single filers and $14,348 for married filing jointly. The total tax on those is $3,133 for the single example and $1,433 for the married example. To cover the deficit and debt in 10 years it would increase to $4,506 for the single and $2,061 for the married.
My personal finances would be $117,589 adjusted gross income, itemized deductions of $19,349 and exemptions of $14,600, making my total taxable income $83,640. My total tax is $13,269, I have credits of $3099 making my total tax for 2010 $10,170. My increase for the 10-year plan would go to $14,625. For the class warfare that the politicians like to use, I compare my finances to the median figures. The median earner pays taxes of 2.9% of their wages for the married example and 6.3% for the single example. I pay 8.7% for my married income, which is 5.8% more than the median example. For the 10 year plan those number would change to 4.1% for the married example, 9.1% for the single example, and 12.4% for me.
For 15 years, the total revenue per year would require 507.9 billion more than the 2010 revenues for 2,669.6 billion, which is an increase of 123.5%. Using the same three examples the new tax would be $3,870 for the single, $1,770 for the married, and $12,560 for me. Percentage of income would move to 7.8% for the single, 3.6% for the married, and 10.7% for me.
For 20 years, the total revenue per year would require 288.5 billion more than the 2010 revenues for 2,450.2 billion, which is an increase of 113.3%. Using the same three examples the new tax would be $3,550 for the single, $1,624 for the married, and $11,523 for me. Percentage of income would move to 7.1% for the single, 3.3% for the married, and 9.8% for me.
Without my healthcare plan.
For 10 years, the total revenue per year would require 3,901.6 billion, which is an increase of 180.5%. So when you do your taxes you would take the total tax, (1040a line 37, 1040EZ line 11), and multiply by 1.805. The US median household income for 2009 was $49,777, with the median adjusted gross income of $33,048. The standard deduction for a single person is $9,350 and for married filing jointly is $18,700 giving a taxable income of $23,698 for single filers and $14,348 for married filing jointly. The total tax on those is $3,133 for the single example and $1,433 for the married example. To cover the deficit and debt in 10 years it would increase to $5,655 for the single and $2,587 for the married.
My personal finances would be $117,589 adjusted gross income, itemized deductions of $19,349 and exemptions of $14,600, making my total taxable income $83,640. My total tax is $13,269, I have credits of $3099 making my total tax for 2010 $10,170. My increase for the 10-year plan would go to $18,357. For the class warfare that the politicians like to use, I compare my finances to the median figures. The median earner pays taxes of 2.9% of their wages for the married example and 6.3% for the single example. I pay 8.7% for my married income, which is 5.8% more than the median example. For the 10 year plan those number would change to 5.2% for the married example, 11.4% for the single example, and 15.6% for me.
For 15 years, the total revenue per year would require 1301.1 billion more than the 2010 revenues for 3,462.8 billion, which is an increase of 160.2%. Using the same three examples the new tax would be $5019 for the single, $2296 for the married, and $16,292 for me. Percentage of income would move to 10.1% for the single, 4.6% for the married, and 13.9% for me.
For 20 years, the total revenue per year would require 658.2 billion more than the 2010 revenues for 2,819.9 billion, which is an increase of 130.4%. Using the same three examples the new tax would be $4085 for the single, $1869 for the married, and $13,262 for me. Percentage of income would move to 8.2% for the single, 3.8% for the married, and 11.3% for me.
Back to the political class warfare angle.
The increases for the 20-year model are much more palpable; however, in comparison this model shoulders the lower income earner with more of the burden. Let me explain. In the current 2010 model single, married, and me pay 6.3%, 2.9%, and 8.7% of income in federal taxes respectively. With my healthcare changes. For the 10-year model, it is 9.1%, 4.1%, and 12.4% respectively. For the 15-year model, it is 7.8%, 3.6%, and 10.7% respectively. For the 20-year model, it has 7.1%, 3.3%, and 9.8% respectively. Therefore, the difference is the gap between them. 10 year plan I pay 8.3% more of my income in taxes than the married median household example, while in the 15 year plan it goes down to a 7.1% difference, and in the 20 year plan it goes down to a 6.5% difference. Without my healthcare. For the 10-year model, it is 11.4%, 5.2%, and 15.6% respectively. For the 15-year model, it is 10.1%, 4.6%, and 13.9% respectively. For the 20-year model, it has 8.2%, 3.8%, and 11.3% respectively. Therefore, the difference is the gap between them. 10 year plan I pay 10.4% more of my income in taxes than the married median household example, while in the 15 year plan it goes down to a 9.3% difference, and in the 20 year plan it goes down to a 7.5% difference.
If you want to be fair it is still a 3% increase for all, but the percentage of income is drastically different. The numbers clearly show that the flat percentage increase across the board increases the difference between the percentage of income the median household pays and what I pay. Therefore, the flat tax application does make the higher income earner shoulder more of the burden.
One thing we have to consider is how I got to AGI for these examples. A quick rundown on how my income is broken down to AGI, compared to the median income examples I used. First, we have to look at how net income is reported for tax purposes. My wife is a teacher who is not eligible for Social Security credits from her job; therefore, she does not pay Social Security wages. She does have a teacher's retirement pension, but she pays 14.82% of her pay for that pension. She gets medical insurance for herself paid for by the school. She was paid 54,187 for the year and was taxed for 1.45% Medicare on that amount. For income taxes, the amount she paid into retirement is not counted as taxable income, so her taxable wages are only 46,157. For me I was paid 78,064, which I was taxed on for Social Security and Medicare. However, I put 6,645.72 (8.5% of salary) into a 401k, making my federal income taxable earnings just 71,418. Furthermore, my company matched 2,285.06 that also did not count as salary. My actual pay received was 88,867.57 for the year. So how did I get from 88,867.57 to 71,418? The 401k contribution is pre-tax, so is my contribution for medical for me and my 2 kids (my wife gets free healthcare, but my insurance plan is much better than hers so I cover our kids) which is 303.35 per paycheck or 7,887.10 per year. I also got reimbursements for health club dues, and some education cost reimbursement that does not count as income as long as it is fewer than 3,000 per year. So my total compensation combined with my wife's is 143,054.57, of that 117,589 is taxable income this year, 16,960.78 plus gains or losses from the stock market will be taxable in the future, and 8504.79 will never be taxed. Of that 8504.79, 7887.10 was for health care costs (medical, dental, vision) and 617.69 was untaxed reimbursements.
My plan to change how we pay for healthcare.
This year my wife and I paid $1,917.64 for Medicare as did our employers, for a total of $3,835.28. I also paid $7887.10 (This includes my copay and out of pocket requirements) for insurance for me and my kids and my employer paid a reported $8,994 for my children and me. I am not sure how much my wife's employer paid for her healthcare. However if I were to pay a flat 8.55% for healthcare, which was matched by my employer it would amount to $6,674.47 my contribution plus $6,674.47 for my employer totaling $13,348.94 for me. The 2.9% currently paid for Medicare would go to the General Revenue bucket to keep current receipts the same, making the new tax a flat 10% total (10% for employee and 10% for employer). In addition, for my wife an employer only contribution would be $4,632.99. The total for both of us would be $17,981.93 for healthcare per year. This should be able to cover the cost of universal healthcare for all when extrapolated throughout the working population.
So let us compare those numbers.
10% (8.55% for healthcare and 1.45% Medicare to General Revenue) for my employer and me is $15,612.80 ($7,806.40 each), which is less than both currently pay now ($1,131.93 + $7,887.10 = $9,019.03 my share and $1,131.93 + $8,994 = $10,125.93 my employer's share). For my wife's employer and her is $6,204.41 ($785.71 my wife's share and $785.71 + $4,632.99 = $5,418.70 her employer's share). Reducing the amount down to a 3.5% (2.05% healthcare + 1.45% Medicare) contribution for each for a total of 7% for lower income workers should make it affordable for both workers and employers.
So to summarize my changes, all outlays except for the retirement programs will be brought down to levels from 10 years ago, with a 3% annual increase applied, and a generous rounding up to get to the new level. On top of this, until the total US Debt is retired there will be a mandatory cap of 3% per year increase applied. There should also be a required constitutional amendment put to a vote to force an annual balanced budget. The Healthcare system in the United States should be funded by a 2.05% tax on income for all workers in the bottom 40% of earners and a 7.1% tax on all income for the top 60% of earners. The employer will match this tax; in exchange for this new tax, Corporate Income Tax will be eliminated. (Most corporations find a way not to pay any corporate income tax anyway, this new tax would be based off of salary paid in all forms. i.e. income, bonuses, stock options, etc.) Individual income taxes will be increased by 143.8% for all. The new tax brackets would look like this:
Married Filing Jointly
Marginal Tax Brackets
Tax Rate Over But Not Over
14.30% $0 $17,000
21.45% $17,000 $69,000
35.75% $69,000 $139,350
40.04% $139,350 $212,300
47.19% $212,300 $379,150
50.05% $379,150 -
So how does this look in the real world?
I was paid $78,064, which I am taxed on for Social Security and Healthcare. I put $6,645.72 (8.5% of salary) into a 401k, making my federal income taxable earnings $64,744.
78064 - 6645.72(401k) - 6674.47 (8.55% healthcare) = $64,744.
For my wife, she was paid $54,187, which she is not taxed on for Social Security or Healthcare. She has to put 14.82% towards her pension by law, making her federal taxable earnings $46,157.
This gives us a combined total of $110,901, our itemized deductions of $19,349 and exemptions of $14,600 stay the same, giving us a total taxable income of $76,952.
Apply the tax brackets:
14.3% x 17,000 = 2,431
21.45% x 52,000 = 11,154
35.75% x 7,952 = 2,842.84
For a total tax of $16,427.84 minus a credit of $3,099 = $13,328.84. This year under the current tax law I paid $13,269 minus a credit of $3,099 = $10,170. This is an increase of 131%.
So let us look at several income levels to see how they are affected. I will go with taxable wages of $10,000, $40,000, $70,000, $110,000, $150,000, $250,000, $400,000 and $1,000,000, which should give a good reference. (Married filing jointly.)
2010 tax laws
10000 *.10 = 1000 percent of income in taxes is 10%
40000 = 17000 *.10 = 1700
+ 23000 *.15 = 3450
1700 + 3450 = 5150 percent of income in taxes is 12.88%
70000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 1000 *.25 = 250
1700 + 7800 + 250 = 9750 percent of income in taxes is 13.9%
110000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 41000 *.25 = 10250
1700 + 7800 + 10250 = 19750 percent of income in taxes is 17.95%
150000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 70350 *.25 = 17587.50
+ 10650 *.28 = 2982
1700 + 7800 + 17587.50 + 2982 = 30069.50 percent of income in taxes is 20.05%
250000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 70350 *.25 = 17587.50
+ 72950 *.28 = 20426
+ 37700 *.33 = 12441
1700 + 7800 + 17587.50 + 20426 + 12441 = 59954.50 percent of income in taxes is 23.98%
400000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 70350 *.25 = 17587.50
+ 72950 *.28 = 20426
+ 166850 *.33 = 55060.50
+ 20850 *.35 = 7297.5
1700 + 7800 + 17587.50 + 20426 + 55060.50 + 7297.50 = 109871.50 percent of income in taxes is 27.47%
1000000 = 17000 *.10 = 1700
+ 52000 *.15 = 7800
+ 70350 *.25 = 17587.50
+ 72950 *.28 = 20426
+ 166850 *.33 = 55060.50
+ 620850 *.35 = 217297.50
1700 + 7800 + 17587.50+ 20426+ 55060.50+ 217297.50= 319871.50 percent of income in taxes is 31.99%
New Tax laws
10000 *.143 = 1430 percent of income in taxes is 14.3%
40000 = 17000 *.143 = 1700
+ 23000 *.2145 = 4933.50
2431+ 4933.50 = 7364.50 percent of income in taxes is 18.4%
70000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 1000 *.3575 = 357.5
2431+ 11154 + 357.50 = 13942.50 percent of income in taxes is 19.92%
110000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 41000 *.3575 = 14657.50
2431+ 11154+ 14657.50 = 28242.50 percent of income in taxes is 25.68%
150000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 70350 *.3575 = 25150.125
+ 10650 *.4004 = 4264.26
2431+ 11154 + 25150.125 + 4264.26 = 42999.39 percent of income in taxes is 28.67%
250000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 70350 *.3575 = 25150.125
+ 72950 *.4004 = 29209.18
+ 37700 *.4719 = 17790.63
2431+ 11154+ 25150.125 + 29209.18 + 17790.63 = 85734.94 percent of income in taxes is 34.29%
400000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 70350 *.3575 = 25150.125
+ 72950 *.4004 = 29209.18
+ 166850 *.4719 = 78367.515
+ 20850 *.5005 = 10435.425
2431+ 11154+ 25150.125 + 29209.18 + 78367.515 + 10435.425 = 156747.25 percent of income in taxes is 39.19%
1000000 = 17000 *.143 = 2431
+ 52000 *.2145 = 11154
+ 70350 *.3575 = 25150.125
+ 72950 *.4004 = 29209.18
+ 166850 *.4719 = 78367.515
+ 620850 *.5005 = 310735.425
2431+ 11154+ 25150.125 + 29209.18 + 78367.515+ 310735.425 = 457047.25 percent of income in taxes is 45.7%
So let us compare the two.
$10,000 of taxable income increased by 4.3%, $40,000 of taxable income increased by 5.52%, $70,000 of taxable income increased by 6.02%, $110,000 of taxable income increased by 7.73%, $150,000 of taxable income increased by 8.62%, $250,000 of taxable income increased by 10.31%, $400,000 of taxable income increased by 11.72%, and $1,000,000 of taxable income increased by 13.71%. My conclusion is that applying a flat 143% to the current tax brackets will increase the personal income taxes in a progressive fashion that I believe to be fair to all.
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