Home
Share |

Content about Political economy

February 20, 2013
Over the Fiscal Cliff for Tax Savings (Part 2)

ARDMORE, Pa. — Package renews more than 50 temporary tax breaks through 2013

ARDMORE, Pa. — The so-called “fiscal cliff” tax package recently signed into law renewed more than 50 temporary tax breaks through 2013, saving individuals and businesses an estimated $76 billion. For the owners and operators of small- and medium-sized dry cleaning businesses, there is good news and bad news contained in the fiscal cliff tax laws.

First, the good news: greater certainty in taxes. The owners and operators of dry cleaning businesses have grown used to many longstanding tax breaks but they also have had to get used to the uncertainty of whether they will be renewed each year.

On the downside, in addition to a 3.8% Net Investment Income (NII) tax and a 0.9% Additional Medicare tax that, thanks to the Health Care and Education Reconciliation Act of 2010, began in 2013, many dry cleaners and laundry owners discovered they are subject to new taxes. Single individuals with incomes above the $400,000 level and married couples with income higher than $450,000 will pay more in taxes in 2013.

May 1, 2012
Building a Retirement Nest Egg

CHICAGO — Building a nest egg sufficient to provide a comfortable retirement can be

CHICAGO — With the painful volatility of the stock market playing havoc with 401(k) and IRA accounts these days, building a nest egg sufficient to provide a comfortable retirement can be a challenging assignment. What makes the job even tougher is a tax provision that may come as a nasty surprise from Uncle Sam after you retire.

Those of us who can look with some degree of satisfaction at how well we are building our tax-deferred retirement accounts need to keep in mind that all withdrawals from our 401(k) and conventional IRA accounts will be taxed at our ordinary income tax rate, which can be as high as 35%. That needn’t be a problem for you in your early retirement years when you may make small withdrawals now and then to fill an occasional need. In fact, voluntary small withdrawals prior to age 70½ may be a way to soften the increasing tax bite soon to come.

December 7, 2011
Last-Minute Tips to Lower Your 2011 Income Tax Bill (Part 2 of 2)

CHICAGO — The filing deadline for 2011 federal income taxes is not far off, but you still have time to make sure you’ve done everything you can to keep Uncle Sam’s paws off as much of your money as possible. Here are some last-minute ways to do that by reducing your 2011 income tax bill:

Often-Overlooked Deductions

Many easily overlooked miscellaneous expenses are deductible as long as they add up to at least 2% of your adjusted gross income. Grouping them can help you meet the threshold. Here are some miscellaneous items you may have overlooked:

December 5, 2011
Last-Minute Tips to Lower Your 2011 Income Tax Bill (Part 1 of 2)

CHICAGO — The filing deadline for 2011 federal income taxes is not far off, but you still have time to make sure you’ve done everything you can to keep Uncle Sam’s paws off as much of your money as possible. Here are some last-minute ways to do that by reducing your 2011 income tax bill:

Save More for Retirement

One of the most important tax-savings steps you can take is contributing the maximum to your 401(k) or other tax-deferred retirement plan. If you haven’t done so, max out your retirement savings now by bringing your contribution up to the legal limit. For 2011, you may put as much as $16,500 into a 401(k), 403(b) or 457 plan. If you’re over age 50, you may add an additional $5,500.

Every dollar you contribute means you will pay less income tax. Except for Roth IRAs, all contributions to tax-deferred retirement plans are tax-deductible in the tax year for which you make your contribution.

If you can’t come up with the maximum, bump up your contribution as much as you possibly can. It may seem painful now, but you’ll benefit greatly in the future.

March 29, 2010
House Passes Small-Business Relief Bill

The House passed a bill Wednesday that provides $19.3 billion in tax incentives to help small businesses obtain capital, while eliminating capital gains on the sale of some small-business stock.

H.R. 4849, the Small Business and Infrastructure Tax Act, allows a 100% capital gains tax exemption from the sale of qualified small-business stock bought before 2012.

The measure also increases the tax deduction for business start-ups from $5,000 to $20,000, and extends the Build America Bonds program through June 2013.

March 10, 2010
Payroll Penalties

With local, state and federal governments suffering the effects of the economic downturn, it should come as no surprise to anyone in the industry that tax laws will be subject to stricter enforcement to shore up plummeting revenues. What might come as a surprise is just how far the tax collector’s reach can extend, however.

November 28, 2008
The Bailout’s Breaks: Wall Street Rescue Provides Tax Credits, Deductions (Part 2 of 2)

The Emergency Economic Stabilization Act of 2008 (EESA) is designed to solve the credit crunch in the financial markets, but it’s also one of the biggest tax bills in recent years.

Many drycleaners will be affected by the rescue bill, thanks to almost 300 changes to the tax laws — including tax breaks expected to save taxpayers a whopping $150 billion.

CONTRIBUTIONS AND S-CORP CHARITABLE DEDUCTIONS

April 18, 2007
Maine Eyes Service Sales Tax

AUGUSTA, Maine — Maine is examining multiple proposals for tax reform that would extend the state sales tax to personal services such as drycleaning.

Legislators’ goal is to reduce state income taxes — currently a graduated system charging 2% to 8.5% on personal earnings — as well as offer property tax relief and tax rebates for low-income owners and renters.