The First Middle Class Tax Increase

The temporary decrease in the employee portion of the Social Security Tax is set to expire December 31, 2012.  Neither party seems inclined to extend it.  Since the Social Security Tax wage base is $110,00, employees earning over $110,000 do not pay this tax.  This indicates that this rise in tax rates will only affect the lower and middle class.

Toppling Off the Fiscal Cliff: Whose Taxes Rise and How Much?.

Submerged Government Assistance

http://nyti.ms/UAJh57

Suzanne Mettler and John Sides write in their NY Times article that 96% of Americans have relied on government assistance. This  includes the deduction for mortgage interest and tax free employer paid health insurance. They call these submerged government social policies. In my opinion, these are the two most likely tax benefits that we will lose in order to balance the federal budget.  They also note that ideology determines whether we label government policies as used by producers or moochers.

Good for the goose? Deferred Comp for Private Equity Fund Managers

“Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes.”

Alfred Eisenstaedt/Time & Life Pictures, via Getty Images

Learned Hand, the federal appeals court judge.

— Judge Learned Hand, 1934

Private Equity fund managers use waived management fees to make required contributions to fund a new acquisition of their funds. This is similar to receiving a partnership interest for services which is clearly taxable. Ultimately, the managers pay the cap gain rate on this investment rather than the ordinary income rate.  Why doesn’t the IRS challenge this?

A Private Equity Tax Tactic May Not Be Legal – High & – Low Finance – NYTimes.com.

Have “the Talk”

Many children aren’t learning much about money from their parents, a new survey shows.

Three in 10 parents never talk to their children about money or have had just one big talk with their children on the subject, according to a U.S. telephone survey conducted for the AICPA by Harris Interactive.

Read the whole article:

Many parents failing to educate children about money.

Plan your meals – Komando.com, Website for The Kim Komando Radio Show®, Komando Downloads

I’ve always heard that the best way to save money at the grocery store is to shop with a list and to avoid impulse purchases.  Here’s technological help!

Plan your meals – Komando.com, Website for The Kim Komando Radio Show®, Komando Downloads.

Per Diem Trivia

Thanks and a hat tip to the US State Department:

The General Services Administration establishes Per Diem Rates for the 48 continental United States and the District of Columbia.  The rates, known as CONUS rates, are normally established in October of each year.  GSA also establishes maximum rates of reimbursement for use of personally owned vehicles (POV).

The Per Diem rates for non-foreign, non-contiguous U.S. areas are established by the Department of Defense Per Diem, Travel and Transportation Allowance Committee (PDTATAC). PDTATAC establishes Per Diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U.S. Virgin Islands, Wake Island and other non-foreign areas outside the continental United States.   Updated information on non-foreign area per diems are published periodically in Civilian Personnel Per Diem Bulletins.  The Per Diem Committee also establishes maximum per diem rates for U.S. military bases.
For Per Diem rates for foreign locations, click on Foreign Per Diem Rates by Location.