This and That

Some stuff to think about:

A great estate planning opportunity expires on December 31, 2012.  Time is growing short, but if you can get it done before that date, you can transfer $5 million, completely free of federal estate or gift tax.  A bit of planning is involved, so this is not something that can be done overnight.  If you want to take advantage, contact your CPA or estate planning attorney immediately.  Even if you decide to do nothing, it is a good idea to review your estate plan every few years.


If you don't have a buy-sell agreement, or if you have one and have not reviewed it for a few years, now is the time.  Do you even know what your buy-sell agreement says?  When you review it and have to decide if it is fair, ask yourself if you would rather be a buyer or a seller.  The fact is, you don't know which you will be, so it should be fair to all parties.  Maybe you can even kill two birds with one stone, that is, do your estate planning in conjunction with your buy-sell agreement, and think about using the $5 million exemption to gift some business ownership to the next generation.


For those of you who are "too busy to do planning," you are planning, except your plan is to pay a ton more estate tax than you have to, and to let a judge decide how much your or your partners' business interests are worth.  That is definitely a plan, but probably not a good one.


The IRS is getting a lot more aggressive in assessing penalties, and I mean serious penalties like the accuracy related penalty.  We see these assessments more frequently, and they often appear to be arbitrarily based on the IRS' perception of the amount of tax underpayment, whether or not it is correct.  Whether you are a business or individual taxpayer, it is important that you are able to support your tax return income and deductions with documentation.  If you need help getting organized, call us.  We can help you.


In case nobody noticed, states need more money.  They get more money by collecting more tax.  They are on the lookout for businesses that operate in a state and don't pay taxes to that state.  If you enter a foreign state to make a delivery, a service call, provide customer training, or do practically anything else, your business is subject to tax in that state.  If you don't file tax returns and get caught later, it will be really ugly.  And the thing is, if you do it correctly you will not pay tax on the same income twice, but if you don't file and get caught later, you will, plus a lot of penalties and interest.  If you have questions about this, call us.


My daughter is leaving for college in two weeks.  After 18 years, this is really scary (for me).  I'm happy that she is doing well and has a great future, but I am going to miss her a lot.


I enjoy photography, and will include pictures from time to time.  I took this one in Grover Cleveland Park in Caldwell, NJ.  Click on it to view a larger version.