April 30, 2008
Another Tax is Struck Down
A $5 per patron fee on Texas strip clubs has been struck down as unconstitutional. The tax, dubbed the “Pole Tax” by some unfairly targeted dance clubs (150 across Texas). The law was intended to raise money for sexual assault programs and “health care for the uninsured”. WebCPA.com 4/3/08
Beware your local Tax Preparer II
A Cambodian American tax preparer and accountant from Long Beach, California went on trial in Los Angeles federal court for plotting to take over Cambodia with a group of freedom fighters! WebCPA.com 4/7/08
Business Attire
During the press coverage of the Spitzer escapades, an interesting side note emerged in the review of the campaign expenditures of Governor Patterson. It emerged that, according to the Daily News, Mr. Patterson listed as constituent services on his campaign finance filings, $1,075.90 in 2004 for clothing at Men’s Wearhouse. If Mr. Patterson thought that the tax law allows a business account to pay for his campaign clothing without it being declared as income, it becomes easier to understand why such an intelligent man did not pass the bar exam.
The leading case on the issue comes from the Second Circuit, which New York is in, in the 1959 case of Donelly v. Commissioner of Internal Revenue, which ruled the expenses the petitioner incurred for his work clothes are not deductible expenses. The Commissioner and the courts are in agreement that in order for the expenses of work clothes to be deductible the clothes must be of a type specifically required as a condition of employment and they must not be adaptable to general usage as ordinary clothing.
Mr. Patterson is not the only high profile person to have questionable tax treatment of their regular business attire. The Reverend Al Sharpton does not deduct his business attire however the 10 or 12 suits that he wears are owned by the Rev. Als Productions. He has unreported income. The use of an asset is also income to the user. We suggest Mr. Sharpton render unto Caesar what is due Caesar. Is it any wonder with leaders like these the public does not have more respect for the tax law? Investors Business Daily 3/24/08
Paying At The Pump
As the thermometer rises, so do gasoline prices or so it seems when the spring/summer driving season rolls around.
Why do prices go up, you ask? It’s not due to a conspiracy of the oil companies, or the gas stations. Each business day, the price of both crude oil and refined gasoline is determined by investors, speculators, and market makers in bourses around the world such as the New York Mercantile Exchange and the Intercontinental Exchange.
Prices at the pump become volatile when global markets become volatile and the physics of oil price movements are remarkably similar to the physics of crowd behavior at a European soccer match.
Any disruption, real or imagined, in supply or demand affects the market.
According to the American Automobile Association, because of this, gasoline prices as low as $1.50 a gallon or as high as $4.00 a gallon are both possible through the rest of the decade. AAA World, July/August 2007 p. 32
If you have any questions about the foregoing or any other financial matters, please call us. If you want to read more, visit the AOHL Newsletter Archives at www.lisch.com
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