Posts Tagged ‘tax’

June 12, 2009 Newsletter

Friday, June 12th, 2009

Health Care for the Future

 

 Current health care costs are estimated to be, on average, more than $8,000 for every man, woman, and child in the United States.  I think we can all agree that there is not enough money available to pay for that.  At the center of the problem is the need for law changes limiting excessive lawsuit settlements related to health care that cause the liability expenses for physicians and hospitals to soar.  In addition, the vast majority of physician offices are run inefficiently.  For the most part they are “mom and pop” organizations.  A uniform standard for reporting and for claims processing would go a long way in reducing costs.

 

I recently met with a physician who does research on longevity and asked him what the most essential steps are to extend life.  His answer surprised me.  Meditation (prayer) was number one, followed by stretching, aerobic and anaerobic exercise, and finally, nutrition.  As individuals we need to take control of our own health.  Most of us know how to be healthy, but we often lack the discipline to follow through to make it happen. (more…)

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May 29, 2009 Newsletter

Friday, May 29th, 2009

Maximizing Compensation

 

 Having been engaged in financial planning for over forty years I am fascinated by the lack of care taken by employees, business owners, ministry leaders and their advisers in the structure of compensation.   Too often significant dollars are spent needlessly because of a lack of understanding of some of the fundamental tax laws.   Structuring compensation properly can benefit the owner, the business or ministry, and the employees, saving thousands of dollars.

 

I always begin this process by reviewing the personal budget of the owner or ministry leader.  From there we identify future goals of the decision maker so that we can look at what new employee benefits we may want to introduce in the future.  Next, a review of the business budget is done to identify tax liability levels for the company and how money is being spent.  We begin to methodically look at reducing any items in the business budget that may decrease operating expenses.  Businesses can be structured to pay healthcare costs, dental, long term care insurance, eyeglass care, childcare, transportation, parking, adoption, life insurance, disability insurance, educational reimbursement, prescriptions, and moving costs on a pre-tax basis.  Additional deductions can be realized with retirement plans and, in some cases, utilities and housing allowances. (more…)

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May 22, 2009 Newsletter

Friday, May 22nd, 2009

Real Estate Trends

 

 As the productivity in this nation continues to turn down and resources become more scarce, housing costs will become an ever increasing problem for many families.  As we have mentioned in previous articles, the government has created a massive Ponzi scheme with the underfunded Social Security, Medicare and Medicaid programs which will result in significant inflation. With significant inflation and tighter controls on credit, finding affordable housing or rentals is expected to be more difficult in the future.  This will increase the number of homeless on our streets. Interest rates will soar.  The number of people who can make the high mortgage payments will decrease bringing values down, but not prices.

 

 Large square footage homes in the suburbs will be a risk primarily because many will find themselves facing reduced incomes precipitated by a decline in productivity.  The productivity decline is caused by the large tax burden (direct and indirect) placed on the goods and services produced by this nation.  If too many people move out of a community, the tax revenue will not be able to provide essential, emergency services. This would cause more people to move away because they would no longer feel safe or protected. (more…)

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May 15, 2009 Newsletter

Friday, May 15th, 2009

Tax Stimulus Pros……and Cons

 

The recent economic stimulus bill has some advantages for certain taxpayers.  The following list represents some of the benefits:

 

1.                  The first $2,400 of unemployment compensation will not be taxed for those who have lost employment between September 1, 2008 and January 1, 2010.

2.                  Those paying for health insurance through COBRA will only have to pay 35% of the cost.  The balance of 65% will be paid by the employer, but reimbursed by the government.  This is available until January 1, 2010.

3.                  The alternative minimum tax exemption allows for couples earning up to $70,950 and single up to $46,700 to avoid paying the tax.

4.                  Anyone who has not owned a home for the past three years can qualify for the $8,000 tax credit if the home is purchased by December 1, 2009, as long as your income does not exceed $75,000 for an individual or $150,000 for a couple.

5.                  There is a temporary expansion of the Hope Credit for the first two years of post secondary education expenses.  The first $2,000 of expenses receives 100% credit while the next $2,000 receives 25% credit up to $500.  This credit phases out for incomes of $160,000 for married couples and $80,000 for single individuals.

6.                  Those with funds in the educational 529 plans can now use the money for computers and computer technology. (more…)

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May 8, 2009 Newsletter

Thursday, May 7th, 2009

EVERYONE NEEDS A PLAN B

 

The short term trend in the market has been upward for equities and although we may see some rocky behavior, the direction appears to be toward recovery.  Our concern, in light of recent behavior in Washington D.C., continues to be toward a highly inflationary season for the long-term.  Warren Buffet recently talked about how inflation taxes those on fixed income by stealing purchasing power.  We fear this sentiment for everyone as new taxes devalue our currency and erode our purchasing power.  The result of these new taxes for US stocks will be repressive.  In turn, global stocks will likely rise more aggressively than US stocks. (more…)

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May 1, 2009 Newsletter

Tuesday, March 24th, 2009

  

HOPE FOR TOMORROW

 

The United States will soon face an economic storm of immense proportions created by a Congress, who for decades have made promises that they cannot fulfill. They have engaged in a process of buying votes in the present while postponing future financial needs.  The baby boom population (78 million people) is approaching 65 and will be asking for Social Security benefits and Medicare benefits that are underfunded.  In addition, the states have the responsibility to provide nursing care for the elderly who are impoverished.  This system is called Medicaid.  It too is largely underfunded. (more…)

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