Larry, My husband has been cheating on his taxes. If I file a separate return, can I avoid being liable?
Mary
Mary, for the current year, if you file as "married filing separately," you will owe tax only on your own separate income, not on your husband's income. But, if your husband has cheated in past years, and you filed joint returns for those years, you can't switch to filing separately for those years. (After filing a separate return, you can still switch to filing a joint return.) But, you may still avoid liability for your husband's taxes on your past-year joint returns by claiming "innocent spouse" status.
You may want to look at IRS Publication 971, Innocent Spouse Relief. If you are a Kopsa Otte client, please come talk to us regarding this issue. If not, please make an appointment with your accountant.
It is a pleasure serving you.
Larry Kopsa CPA
Tuesday, August 11, 2009
Monday, August 10, 2009
GOVERNMENT TRUE-ISMS
"Suppose you were an idiot. And suppose you were a member of Congress....But then I repeat myself." -Mark Twain
Friday, August 7, 2009
READ MY LIPS, NO NEW TAXES
One of President Obama’s pledges was that he would only increase taxes on those wealthy Americans who make over $250,000 per year. I’m not sure exactly what he meant by this but it appears to me that with some of the proposals they’re talking about in the health care reform, it seriously increases people’s taxes.
Here’s an example. I just had a young couple in my office. Both are college graduates who are working hard. He is a banker and she is a nurse. Between them, they are making close to $100,000. The income they are making throws some of their income into a 25% federal bracket and a 7% state bracket. In addition to this, they have to pay social security of 7.65% which is matched by their employers.
As we discussed their situation, the conversation evolved into health care reform. Currently, their company is providing them with $4,200 of health insurance. They are putting $5,000 into a cafeteria plan and they are completely funding a health savings account in the amount of $5,950. In Washington D. C. they are discussing eliminating the deduction for all of these items. If this were the case, I calculated that their tax will increase by $5,551. They couldn’t believe it. They don’t have an extra $5,551 with three children, house payments, etc.
I told them it’s actually worse than this. If they consider it, their tax cost is actually $5,551. In their tax bracket, they would have to go out and earn an additional $9,200 to bring home this amount of money. In addition to this, their employer would have to pay social security on those funds which would cost the employer an additional $700 in taxes.
Although President Obama didn’t say, “Read my lips,” as the first president Bush did, he certainly doesn’t seem to be following his promises. If they pass these measures to fund health care, he definitely isn’t following his promises.
Here’s an example. I just had a young couple in my office. Both are college graduates who are working hard. He is a banker and she is a nurse. Between them, they are making close to $100,000. The income they are making throws some of their income into a 25% federal bracket and a 7% state bracket. In addition to this, they have to pay social security of 7.65% which is matched by their employers.
As we discussed their situation, the conversation evolved into health care reform. Currently, their company is providing them with $4,200 of health insurance. They are putting $5,000 into a cafeteria plan and they are completely funding a health savings account in the amount of $5,950. In Washington D. C. they are discussing eliminating the deduction for all of these items. If this were the case, I calculated that their tax will increase by $5,551. They couldn’t believe it. They don’t have an extra $5,551 with three children, house payments, etc.
I told them it’s actually worse than this. If they consider it, their tax cost is actually $5,551. In their tax bracket, they would have to go out and earn an additional $9,200 to bring home this amount of money. In addition to this, their employer would have to pay social security on those funds which would cost the employer an additional $700 in taxes.
Although President Obama didn’t say, “Read my lips,” as the first president Bush did, he certainly doesn’t seem to be following his promises. If they pass these measures to fund health care, he definitely isn’t following his promises.
Thursday, August 6, 2009
FROM GRASS TO GLASS
Very interesting stuff taking place in the Heartland. I didn't even know this place existed.
Click on From Grass to Glass to view a YouTube video on Dairy Farming.
Click on From Grass to Glass to view a YouTube video on Dairy Farming.
Wednesday, August 5, 2009
WHO ARE AMERICA'S LARGEST POLITICAL DONORS?
A political action committee, or PAC, is a private group that organizes to elect political candidates. PACs receive and raise money from the group’s constituents and make donations to political campaigns. PACs that donate to federal races (e.g., U.S. Senate and House races or presidential races) must report all of the financial activities to the Federal Election Commission (FEC), which makes the reports available to the public.
To see the list of top political contributors go to: Top Political Donors.
To see the list of top political contributors go to: Top Political Donors.
Tuesday, August 4, 2009
QUOTE OF THE WEEK
An army of 200 sheep lead by a
lion will always defeat an army of
200 lions lead by a sheep.
lion will always defeat an army of
200 lions lead by a sheep.
Monday, August 3, 2009
INSPIRE YOUR KIDS
I thought you might be interested in this article I found as I was going through some old magazines.
As a parent, I know how difficult it can be to effectively communicate with our children. What we mean to "say" to our children isn't always what they "hear."
The following Reader's Digest article explains that a child's brain cannot be expected to process words the same way an adult's does. This article contains some great information to help us inspire our kids, and gives examples of 7 important things to say, and (7 things not to say).
Check it out at: Reader's Digest.
As a parent, I know how difficult it can be to effectively communicate with our children. What we mean to "say" to our children isn't always what they "hear."
The following Reader's Digest article explains that a child's brain cannot be expected to process words the same way an adult's does. This article contains some great information to help us inspire our kids, and gives examples of 7 important things to say, and (7 things not to say).
Check it out at: Reader's Digest.
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