Broker Check

 August 15, 2002

Tax Deductible Vacations
(Reprinted from June, 1995 AOHL Newsletter

It can pay to mix business with pleasure.  By doing so on a summer trip you may be able to deduct 100% of your transportation and lodging and 50% of your meal costs.

If the primary purpose of your trip is business, you can deduct your travel costs even if your trip includes personal activities, and even if you extend the trip for a few non-business days. 

You can also deduct 100% of your lodging and 50% of your meal costs for the period in which you were engaged in business even though you also engaged in substantial recreational activities during this period.  You cannot deduct separate non-business expenses incurred during your stay such as the cost of tickets to entertainment events.  Nor can you deduct lodging and meal costs incurred during the extended non-business portion of your trip.

If you bring someone with you on the trip you may still be able to deduct most of the cost of the trip even if your companion travels with you solely for pleasure.

Business Bar-b-que
(from July, 1992 AOHL Newsletter

Summer is here and Texans (Ross, George & Ann) aren’t the only ones to bar-b-que.  The trick of bar-b-quing is not in the sauce but in whether you can deduct the cost of the shindig.  The first thing you must do is keep track of all the costs of this fiesta, from the food and paper goods you just bought at the supermarket to the additional food and spices taken from the pantry to the number of ounces of drinks consumed from the liquor cabinet.  Oh yes, don’t forget the mileage (@ 28¢ per mile, now 36.5¢ ) to get the vittles either.  Next, you need a good reason for the feast, such as you are inviting your accountant or attorney over to discuss personal financial planning or to thank him for a small tax liability or to work out the kinks or to advise on that new business deal you are negotiating.  The subject matter must be an immediate prospect of business, not just some good public relations (i.e. to show how that refund was spent on a new pool and fence). 

You must record the names and business relationship of the guests.  The government doesn’t want you to deduct the cost of feeding the accountant’s family, but then you can always argue that the 3 year old didn’t eat much and the girls just eat like birds anyway. 

You can estimate the costs if need be, write them all down on a sheet of paper, attach the store receipts and save them for April 15 (preferably February).  Oh yes, clean the ketchup off first before you give them to us.

The IRS Should Be Indicted

for abuse of power.  Recently, the IRS released the names of hundreds of people who had either invested in or inquired about a certain CPA firm’s tax shelters.  The IRS made the accounting firm’s names public in order to embarrass them or to pressure the CPA firm to settle with the IRS and to make other law abiding taxpayers think twice about trying to shelter their income. 

This is a gross breach of privacy as well as a violation of the law.  The information given to the IRS is supposed to be confidential. 

Let’s see if the Bush Administration punishes the blackmailers at the IRS.

NYS Tax Amnesty

New York State has for the third or fourth time declared a “once in a lifetime” tax amnesty for taxable periods ending on or before December 31, 2000 except for taxes which require quarterly tax returns, in which case the period ends February 28, 2001.  The amnesty program waves all applicable penalties including the additional rate of interest generally referred to as the “interest penalty” and also reduces by two percentage points the applicable rate of interest associated with the tax liability. 

Amnesty is not available to taxpayers who received any benefit under previous New York State amnesty programs nor will it be granted to a taxpayer who is the focus of any criminal tax investigation, administrative tax proceeding or civil or criminal tax litigation which is pending with regard to the underlying liability on the date of the taxpayer’s amnesty application. 

All amnesty payments for taxes, interest, deferred payment plans, etc. must be fully paid by March 15, 2003.  Hudgson Russ Tax Seminar 7/24/02

NYS Tax Relief for Victims of 9/11/01

On May 29, 2002, Governor Pataki signed into law, personal income and estate tax relief for victims of the September 11, 2001 terrorist attacks.  The victims are generally exempt from New York State, City and Yonkers personal income taxes for the 2000 and 2001 tax years.

Surviving spouses, personal representatives or executors of the victims may file amended tax returns for 2000 and 2001 to claim a refund of the taxes paid.

The new law also provides that a taxable estate of $2,936,818 or less is exempt from New York State estate tax.  TSB-M-02(5)I

Long Term Care Insurance

This insurance is increasing in importance and more of our clients are availing themselves of it.  In order to provide better services to you in the area, we have established a relationship with GE Capital Life Assurance Company of New York, through Mark Blum, a Master Long Term Care Specialist.  This is the company that pioneered Long Term Care more than 25 years ago.  If you are interested in discussing this, please call me and I will set up an appointment at no cost with my associate, Mark Blum.

Have You Hugged Your Lawyer Today?

 Lawyers, like most people, need to reduce the amount of stress in their lives.  Lawyers have their own special brand of stress, because everything they do is conflict oriented and everything is under constant scrutiny by the courts, other lawyers, judges and themselves.

 Lawyers are portrayed too positively on television and people go into the field with unrealistic expectations, and their eyes glazed over in a fantasy. Stress causes tension, which slows down the digestive system, elevates adrenaline and cortisone levels in the body and triggers the “fight or flight” response. 

If I seem grouchy at times, maybe it’s because of all I am doing for you! NYSBA State Bar News May/June 2002 p.12

Still Haven’t Received Your Federal Refund? 

The IRS has just unveiled an internet based system to make it easier for filers to find out about the status of their tax refund.  To use the new system, go to and click on “Where’s My Refund?”  You’ll need your social security number, filing status and refund amount. The Kiplinger Tax Letter 6/7/02 

If you would like more details about any of the foregoing, please call me.  Remember, We’re Here For You!!