The Age of Misinformation!

CAUTION!  We’ve gone from the age of information to the age of MISINFORMATION! 

I have been told that this blog appears with advertising.  I do not allow ads to appear in this blog, and never will.  At first I thought there are hackers who have managed to invade the blog and make these ads appear.  I have since found out that WordPress is now resorting to extortion in seeking a “No Ads Upgrade” by placing porn ads on my blog.

Please be assured that if you see any advertising here on this blog, it is WordPress doing so to make money for WordPress.   I only receive a free blog hosting.  I do not place ads.  I do not receive compensation for ads.  Proceed with caution!

Form 941 for 2013

The new Form 941 for 2013 is here:
The instructions are here:

The major changes to Form 941 are on lines 5a through 5f. The Social Security (OASDI) tax rate on lines 5a (Taxable Social Security wages) and 5b has increased from 10.4% to 12.4%. The 2% increase is due to the expiration of legislation that temporarily reduced the employee Social Security tax rate from 6.2% to 4.2% through Dec. 31, 2012.

Line 5d, Taxable wages & tips subject to Additional Medicare Tax withholding, has been added to Form 941. Beginning in 2013, in addition to withholding Medicare tax at 1.45%, employers must withhold an additional 0.9% Medicare tax from wages paid to an employee in excess of $200,000 in a calendar year. Employers must begin withholding the additional Medicare tax in the pay period in which wages are in excess of $200,000, and continue to withhold it until the end of the calendar year. The tax is only imposed on employees. All wages that are subject to Medicare tax are also subject to additional Medicare tax withholding if paid in excess of the $200,000 withholding threshold.

There are still lines on the 2013 Form 941 for COBRA premium assistance payments/subsidy (lines 12a and 12b) because some involuntarily terminated workers may still be eligible to receive a COBRA premium subsidy, even though the subsidy was not available to most workers beyond Aug. 31, 2011.

Nothing is FREE, especially INSURANCE and INVESTMENT “PRODUCTS”!

I subscribe to a lot of financial industry emails to keep up with the latest sales tactics that some so called “financial advisors” use to separate taxpayers from their hard earned money.  In today’s inbox is this ad:


A SIMPLE PRESENTATION USING THIS OPTICAL ILLUSION (and an optical illusion is pictured) IS MAKING ADVISORS $30,000, $40,000 AND $50,000 A MONTH


Simple. This new product is easy to sell for 2 reasons:
1. It instantly doubles your client’s:
• Growth
• Income
• Safety
• All with no additional taxes
2. And you don’t have to move a single cent of their money… leave it right where it’s at (imagine making $6,000 commission without having to move a penny of your client’s portfolio)!

This new product has already been reviewed by FINRA is 100% compliant with all BD’s and Insurance companies… and is selling itself during 1-call closes (why wouldn’t it, looking at the 2 reasons above)?

If you get in front of people before your competition… this will be the easiest sale of your life.

Learn how it’s done in a 50-minute presentation by the creator of the product and presentation and get ready to be rocked. These types of opportunities only come around in the financial industry every 10 years or so… and they are dynasty makers.”


As my Dad used to say in the fishing tackle business, you first have to catch the fisherman before your lure has a chance to catch any fish.   With this kind of advertising to the financial advisors who sell you “investment” products, you will find some advisors will be looking out for their own interests first.  Someone has to pay for that $6,000 commission, and you can be certain that if you buy whatever this investment product claims to be, that $6,000 will be coming out of your pocket.   You won’t see that because it is an OPTICAL ILLUSION!

Charitable Deductions for Noncash Contributions

Goodwill Values Goodwill Industries has published this guide which is referenced on the IRS website as appropriate for valuing your noncash contributions of used clothing, furniture and sporting goods.

2013 IRS Standard Mileage Rates

Beginning on Jan. 1, 2013, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 56.5 cents per mile for business miles driven
• 24 cents per mile driven for medical or moving purposes
• 14 cents per mile driven in service of charitable organizations

The rate for business miles driven during 2013 increases 1 cent from the 2012 rate. The medical and moving rate is also up 1 cent per mile from the 2012 rate.

Who is an Employer under Health Care Reform?

Employers with 50 or more full-time equivalent employees must comply with the mandate to offer affordable health insurance to its full-time employees beginning in 2014. (Delayed to 2015 by President Obama in July 2013.)

Full-time is defined as 30 hours per week, 52 weeks per year, or 1,560 hours of wages paid in a year’s time.

A simple calculation to see if an employer must comply is to multiply the 1,560 hours times 50, which equals 78,000 hours of wages paid in a year’s time. If an employer is paying that many hours or more, they have achieved 50 full-time equivalent positions in a year. The Affordable Care Act has its own calculations that are slightly different to accommodate partial years and quarters of employment, but this is essentially the concept. And if an employer comes under the Act’s mandate to provide affordable health insurance, it must be offered to all employees who work 30 hours a week or more.

The Affordable Care Act defines an “Employer” to be a company or a group of companies under “Common Control”. Common control is defined as the same five or fewer people owning at least 80 percent of the companies. This common control is further complicated by the rules of attribution with “constructive” stock ownership. An individual can be considered owning the stock of his or her spouse or children, grandchildren or parents. This can get complicated when multiple generations of a family are involved in their respective business ventures. This also means that an employer can not separate a company into multiple entities to prevent having 50 full-time equivalent employees, unless those new, separate entities no longer fit under the definition of common control.

Under the rules of “Common Control”: what one spouse owns, the other also owns. Therefore, if each partner of a couple in a marriage owns a business, the employees of both businesses are counted as one business for purposes of the 50 full time equivalent calculations.

Health Care Reform is an Individual Mandate

Health Care Reform Act in its entirety

The concept behind “ObamaCare” is that the individual must purchase health insurance coverage for himself or herself and his or her dependents. Check it out on page 143 of the ACT shown above. You can’t pay for healthcare services as you use them; you must first purchase health insurance.

If you’re self-employed, you must purchase health insurance. If you work part-time and your employment does not provide health insurance, you must purchase health insurance. If you work full-time and you don’t like the health insurance policy provided by your employer, you must still purchase health insurance from somewhere.

Purchasing health insurance doesn’t guarantee access to healthcare; it only means that you have prepaid for future healthcare services, as long as you continue to pay the monthly insurance premiums, and IF you can find the healthcare services.

I speak of “finding” health care services because of concerns that I see already BEFORE health care reform. Right now, my peers in healthcare complain that Medicare only pays 25 cents on the dollar and that Medicaid only pays 12.5 cents on the dollar of healthcare charges and that it is a difficult job to set compensation for 1700 angry doctors in one healthcare organization. If we have angry doctors now, and government programs are not paying the true cost of healthcare now, what will happen with forced insurance coverage? Will there be enough doctors who want to work under conditions of very limited compensation? Will there be enough healthcare organizations that will financially survive to provide healthcare services?

We have all heard about the penalty tax for not purchasing health insurance; it starts at $95 in 2014 and goes up to $695 in 2016 or 2.5% of your taxable income, whichever is greater, and it is to be paid on your income tax return. Much has to be determined yet, on how to account for health insurance coverage. Can you imagine what that will do to income tax return information reporting? Perhaps a dependent deduction will only be granted the parent who provides health insurance? Tracking compliance will involve your personal income tax return and access to health care. If you go to the hospital for emergency care and you don’t have health insurance coverage, will hospitals be required to report you to the IRS for noncompliance?

There are a lot of questions on how this health care reform will be implemented, and subsequent blogs will explain what is currently known and written into law. The most important concept though is that the individual is the responsible party for purchasing health insurance.