Minimum Distributions Back for 2010

When retirement plans suffered big losses in 2008, Congress enacted a one‑year moratorium, for 2009, on the requirement that retirees over the age of 70‑1/2 withdraw a certain amount from their individual retirement and 401(k) accounts. Since the distributions are subject to taxation, retirees could avoid the taxman in 2009 by not having to take the usual minimum distributions, not to mention avoiding the investment mistake of “buying high and selling low.” Continue reading

Know About the “No-Zone”

All drivers should be aware of the “no‑zone,” the area on the sides and rear of 18‑wheelers where the truck driver cannot see a car. This dangerous area is easy to locate: If you can’t see the driver of the truck in his mirror, then he can’t see you. Continue reading

Debit Versus Credit Cards

When you are pulling out the plastic to make a purchase, will it be debit or credit? It makes sense to know how each works, and their respective advantages and disadvantages. The bottom line is that debit cards are fine for small and/or routine purchases, but credit cards, as a rule, are better for major purchases and online transactions because they offer more protections if something goes awry. Continue reading

No Estate Taxes for POD Beneficiary

Before James died without a will, and with an estate valued at about $12 million, he had designated his teenage goddaughter, Jessica, as the beneficiary on two payable on death (POD) accounts worth almost $4 million at his death. Jessica and her parents were then sued by James’s estate, which was seeking reimbursement for the federal and state estate taxes that were attributable to the POD accounts. Continue reading

Better(?) Disclosure for Mortgage Consumers

The federal Real Estate Settlement Procedures Act (RESPA) is a consumer protection law for homebuyers that is enforced by the Department of Housing and Urban Development (HUD). The thrust of the law is to require that loan originators make certain disclosures to borrowers so that they can be more informed consumers, entering into more transparent transactions. HUD recently wrote new regulations requiring that borrowers receive both a standard Good Faith Estimate (GFE) that discloses key loan terms and closing costs and a new “HUD‑1″ settlement statement.

The format of the new GFE is supposed to simplify the process of originating mortgages by consolidating costs into a few major cost categories. The former GFE had a long list of individual charges. The new version includes this list, but also has a summary page containing the key information for comparison shopping by the consumer. Continue reading

Websites and where to sue

After she became dissatisfied with the services of home remodeling contractors that she had obtained through an Internet referral website, Victoria sued the referral business for breach of contract, fraud, misrepresentation, and negligence. Continue reading

Spouse Tax Relief

For most married couples, filing federal income taxes jointly rather than separately results in a lower tax bill. However, this “all for one, one for all” approach can have a downside if questions arise about the accuracy of the return. The general rule is that both taxpayers will be responsible, individually as well as collectively, for any taxes, interest, and penalties owed, even if only one spouse was earning the income. It may be that in a couple’s division of labor only one spouse is in fact responsible for understating income or erroneously claiming deductions, but, by law, each spouse can be made to answer to the IRS. Continue reading

Sculptor Slays Government Goliath

Some 20 years ago, a World War II veteran and prominent sculptor won a government competition to sculpt a memorial to Korean War veterans in Washington, D.C. His creation depicts a platoon of stainless steel, larger‑than‑life foot soldiers arranged in what has come to be called “The Column.” Five years later, another veteran, an amateur photographer, took photographs of the memorial. One of these photographs eventually was used by the federal government on a widely distributed postage stamp, for which the government paid the photographer $1,500. Continue reading

Tax Credits for Historic Preservation

For over 30 years, the federal government has been using tax incentives to help preserve historic buildings. Originally, federal law allowed accelerated depreciation on rehabilitated buildings, but subsequent changes have made preservation and revitalization efforts even more attractive to taxpayers. Continue reading

Overtime Pay Update

Under the federal Fair Labor Standards Act (FLSA), employers must pay an employee an overtime rate of at least one and one‑half times the regular pay rate for any hours in excess of 40 hours a week. There are exemptions from this requirement for several types of employees, including employees in executive, administrative, or professional capacities. Continue reading