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Really Strange Tax Laws | Tax Tip of the Week | No. 209 July 31, 2013

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Really?…..

State lawmakers can certainly think of some strange tax laws. The Tax & Accounting business of Thomson Reuters recently produced its annual list of “quirky” sales and use tax laws from the past year:

  • In Illinois, fans of Whoppers malted milk balls are in luck. Candies that contain flour, like the Whopper, are exempt from the state’s candy tax, which applies to all other candies
  • While food and food products are typically tax exempt, New York has deemed vegan edible gummy drinking glasses taxable. Under the current ruling, the glasses were deemed a confection and therefore taxable under current sales and use tax law.
  • Boat enthusiasts are rejoicing in Maine as a result of the new tax exemption for parts and supplies such as  sails, rope, rigging and masts used for operating, repairing and maintaining windjammers used to ferry people and cargo as a business activity
  • Wine lovers in Maryland are now subject to double taxation should they wish to bring their own bottle of wine to their favorite restaurant. Under the new ruling, residents are taxed for having someone open the bottle for them.
  • Retiring just got sweeter for residents of Sitka, Alaska, who are now exempt from sales tax for the purchase of goods, services and rentals after reaching the ripe age of 65.
  • In Connecticut, not all diapers are created equal. Adult diapers are tax exempt, but children’s diapers are taxed.
  • This last one is not really an odd tax law, but rather a twist on a “normal” tax law turned strange by a business owner. A theater owner in Spain came up with a unique solution to falling ticket sales after the VAT (Value Added Tax- that some advocate to replace the US income tax laws) on admissions to theaters was raised to 21 percent this summer: carrots. Since vegetables are subject to a reduced rate (currently 4 percent), the theater has transformed itself into a produce stand of sorts. Now when customers opt to buy their carrots from the theater for a mere $16, they are treated to a free theatrical performance.

 

Gotta love lawmakers!!!

As always, give us a call with any questions or concerns you may have.

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

 

Happy Birthday to Us! | Tax Tip of the Week | No. 208 July 24, 2013

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Special Edition

This week’s edition marks the fourth anniversary of our Tax Tip of the Week!

We have enjoyed bringing these tax related articles to you each week but we especially appreciate the many faithful readers that follow us. Thank you!

Our firm, and Lance Bradstreet specifically, was recently highlighted by The Dayton Business Journal as being one of the top people in Dayton to follow on Twitter (http://www.bizjournals.com/dayton/news/2013/05/08/who-to-follow-on-twitter-in-dayton.html?s=image_gallery).  Our Twitter feeds can be a great place to get further tax, accounting, and finance updates that fall outside the realm of the Tax Tip of the Week.  We can be found on Twitter at @lancebradstreet and @Bradstreet_CPAs.

Again, thank you for your support and feedback.  We will continue to bring you these tax tips in your e-mail, on Twitter, on our Blog, or on the web.

Tax Alert:  Next week we will be discussing the increase in sales tax that is on the horizon for Ohio businesses.  Starting September 1, 2013 Ohio sales tax will be going up a quarter of a percent.  More to come….

Let us know if there are any topics you would like us to address in the future.

As always, give us a call with any questions or concerns you may have.
You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

 

 

Planning Your Future – Part 4 | Tax Tip of the Week | No. 207 July 17, 2013

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You Really Need to Plan for This – Part 4

Our death and possibility of developing an incapacitating illness are not pleasant things to think about.  But planning for them, however, must be addressed.

This is part four of a four part series of Tax Tips that will highlight some of the primary legal steps you should consider. NOTE: We are NOT attorneys.  Please consult with an attorney before following any of these suggestions

Assemble Your Records—And Let Someone Know Where They Are Located!

Even if you have a power of attorney to help manage your property, have signed a valid will and have created a revocable living trust, it will help your advisors if you have an organized system for your records.

The first set of records should include all of the above planning documents. In addition, the documents for the care of your person, such as a durable power of attorney for healthcare, a HIPAA release a living will or an advance directive should be included.

The second set of documents will be all of your financial records. Many people with a chronic disease have placed their records on computer. Through a combination of online banking and records from your brokerage and securities accounts, all of your financial data can be accessible in one location.

The third category of record is your family information and personal history. This could include marriage certificates, insurance records and other various types of medical reports.

We hope you learned some planning tips in the series.  Most importantly, we hope it has inspired you to call your attorney and make any needed changes to your estate plans.  Give us a call if you do not have an attorney and need a referral.

As always, give us a call with any questions or concerns you may have.

You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

 

Planning Your Future – Part 3 | Tax Tip of the Week | No. 206 July 10, 2013

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You Really Need to Plan for This – Part 3

 Our death and possibility of developing an incapacitating illness are not pleasant things to think about.  But planning for them, however, must be addressed.

This is part three of a four part series of Tax Tips that will highlight some of the primary legal steps you should consider. NOTE: We are NOT attorneys.  Please consult with an attorney before following any of these suggestions

Revocable Living Trust

A revocable living trust is strongly recommended for everyone. It is much more flexible than a durable power of attorney.

If you suffer from a disability or become incapacitated, upon the recommendation of one or two physicians your successor trustee will be empowered to manage your assets.

With no revocable living trust, a family member may instead be required to obtain permission from the probate court to create a conservatorship. This will require expensive and repeated visits to the court for approval of expenditures, sale of most real property and other actions. It will greatly increase the expense and the difficulties for the person who is acting as your conservator.

A successor trustee under a revocable living trust is far more flexible and less expensive. Compared with a conservatorship, the cost of creating the revocable living trust may be recovered in the first few months of the time when you need someone else to manage your property.

Revocable living trusts are a legal agreement. You specify the management powers of the trustee, the general provisions for distribution of income and principal and select your successor trustee. Ordinarily, you will serve as the initial trustee. If you are incapacitated, the successor trustee will take over and manage the property. Your property will be legally transferred with a deed for real property and by creating trust accounts for mutual funds, securities and cash. It is essential to make sure that title to the selected property is properly transferred under state law rules to you as trustee of the living trust.

We will conclude this series next week.

As always, give us a call with any questions or concerns you may have.
You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.

 

Planning Your Future – Part 2 | Tax Tip of the Week | No. 205 July 3, 2013

Posted by bradstreetblogger in : Tax Planning Tips, Tax Tip, Taxes, Uncategorized , add a comment

You Really Need to Plan for This – Part 2

Our death and possibility of developing an incapacitating illness are not pleasant things to think about.  But planning for them, however, must be addressed.

This is part two of a four part series of Tax Tips that will highlight some of the primary legal steps you should consider.  NOTE:  We are NOT attorneys.  Please consult with an attorney before following any of these suggestions

Capacity to Make a Will

If you develop a chronic illness, your basic estate planning document is still a will. While you may also have a revocable living trust, a will is needed to distribute any property not owned by the trust when you pass away.

Many of your assets will pass to beneficiaries outside the probate process and will not be owned inside your trust. These include your qualified IRA and other retirement plans, life insurance policies that are transferred by beneficiary designation and any real property owned as joint tenants with right of survivorship. That real property will be transferred under property law to the surviving person.

However, if your designated beneficiary under a qualified retirement plan or a life insurance policy passes away before you, or the other joint tenant with a real property asset passes away prior to your demise, the assets could be distributed to your estate and be subject to your will. Therefore, it is essential to have a proper will.

With some types of chronic illness, you may have a loss of either physical or mental abilities. In this case, an heir could claim that you do not have proper capacity to sign the will and could contest it. Therefore, it may be helpful to emphasize to your witnesses that you clearly understand the process and have a good understanding both of your property and of the general provisions of the will. In addition, some individuals obtain records from their physicians that explain the various types of treatment. Your doctor may also discuss your ability to have control of your mental facilities during the estate planning process.

More on this subject next week…..

As always, give us a call with any questions or concerns you may have.
You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.

Rick Prewitt – the guy behind TTW

…until next week.