Broker Check

May 28, 1996

Thank You for a Successful Tax Season, But!

          It was a very busy tax season and we are thankful for your continued relationship. We faxed our last extension at eight o`clock in the evening to an out of state client whom, we trust, drove to a post office that night.

          Business increased with the addition of new businesses and individuals as well as the growth of existing clients. As a result of this growth we will be adding more professional staff in the near future, primarily to handle the corporate clients.

          Now a note, we know that during tax season we say that we will get to some matters after tax season. So it`s April 16 and everyone thinks they have the only problem I need to attend to after tax season. Please understand that after tax season to us is April 16 through August 15 and we prioritize all matters and get to each in due course. If we haven`t gotten to yours yet or as soon as you thought we should have because you think we have less work than during tax season, we`re sorry for the misunderstanding. We still have months of work to do and the only thing different is that I now work a 50 hour week, down from a 100 hour week, etc.

Tax Thoughts on the Jackie O Auction

          Believe it or not, a few souls at the Jackie O auction might not have been possessed by mass hysteria. Some might have been bidding with an eye to next April 15.

          If Marvin Shanker the publisher of Cigar Aficionado magazine uses the humidor he paid $574,500 for to store cigars, he can depreciate it. The publicity isn`t bad either.

          Jewelry designer Carolee Friedlander bought faux pearl ear clips and a necklace for $76,750. She is planning on a special line of costume jewelry inspired by the pieces. A deductible research expense?

          How about Mrs. Onassis` silver tape measure from Tiffany which brought $48,875 from interior designer Juan Pablo Molyneux who said he bought it as a good luck charm for a new project he`s designing for a client. He said the tape would be used on the construction site. Part of construction overhead?

          How about Arnold Schwarzenegger`s purchase of JFK`s golf clubs? Might they end up in Planet Hollywood? Or will he use them in a Pro-Am outing? Publicity expenses?

Reactionary House Republicans Plot New Taxpayer`s Rights Bill

          A new Taxpayers Rights Bill passed the House and is expected to pass the Senate. The Extremist Republicans have proposed:

  • IRS will be able to forgive interest in more situations such as audit delays due to their losing records or when they transfer an agent.
  • IRS will allow more time to pay before adding interest, 21 days, up from 10.
  • Married couples who filed separately can change their minds and file a joint return without having to pay the tax owned by their separate filings.
  • Private delivery services will have parity with the post office when trying to prove that documents sent to the IRS were timely mailed.
  • Telephone numbers must be put on Form 1099 so that recipients can be contacted by the IRS.

          The Bill will offset these revenue losses with increased penalties on excessive salaries of officers, directors, trustees and members of families of tax exempt organizations as well as a penalty on below market transfers to officers.

          And they said Republicans favored the rich!

New York State Wants Information on Newly Hired Employees

          Governor Pataki`s attempt to crack down on dead beat dads has resulted in employers having to report certain information to the Department of Taxation and Finance within 15 days of the employees being hired. Simply put, New York wants the front of a completely filled out Federal Form W-4 to be mailed to -

                    New York State Department of Taxation & Finance
                    New Hire Notification
                    P.O. Box 15119 
                    Albany, NY 12212-5119 
                    or facsimile it to 518-463-4514

          Last year only 8% of the calls to 1-800-829-1040 got through to a human. But youՀll have better results dealing with machines. If you need IRS forms dial 1-703-487-4160 to obtain them by facsimile transmission but you can only get 57 commonly requested forms. So complicated has the Internal Revenue Code become that there are now 585 forms and you can get anyone of them on the above World Wide Web site, also all new (but not old) regulations and proposed regulations and the full text of 106 IRS publications. To get forms the old way you can call 1-800-TAX-FORM and the IRS will take up to 3 weeks to get the forms to you.

Pardon Us!

          Pardon our tardiness but we wish all of you had a wonderful Mother`s Day.

          If you have any questions about these or any other financial matters, please call us.