Posted by Sean Cruz | Posted on 19-09-2010
If your debt has been written off by a creditor then you may receive a 1099-c from the source. You must claims this amount as income on your taxes because you never paid it back- thus making it income. However if you “settle” this debt as “paid in full” with the creditor make sure you ask that they agree to the settled in full arrangement and not send the remainder as a loss to the IRS.
If the creditor willingly accepts “less than” as “full payment” then make sure they agree not to report remainder. The creditor can refuse but usually does not. See exceptions below /p>
Posted by Heather Ward | Posted on 17-09-2010
The North Carolina Court of Appeals, in Kinlaw v. Johnson, confirmed statutory law protecting IRAs from creditors, and extended the protection to the account owner’s legal use of IRA funds from collection on a creditor’s judgment. The court stated:
“We therefore hold, liberally construing the statute in favor of Defendant, Elmwood, 295 N.C. at 185, 244 S.E.2d at 678; Laughinghouse, 44 B.R. at 791, that N.C. Gen.Stat. § 1C-1601(a)(9) exempts Defendant’s IRAs and Defendant’s legal use of funds contained within those IRAs, from Plaintiff’s judgment. As the issue is not before us, we do not make any holding regarding any question concerning contributions Defendant may have made, or may in the future make, to his IRAs.” (Emphasis added.
Michael Kinlaw, Plaintiff, v. J
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Posted by Shannon Myers | Posted on 17-09-2010
The outfits are less sexy, the makeup and hair a bit more demure and the heels not as sky-high, but the saucy Bratz dolls are strutting their way back onto toy shelves.
During the last few years, a legal tug of war between Bratz maker MGA Entertainment Inc. and rival toy company Mattel Inc. over the ownership rights to the dolls left the brand crippled. After a trial jury ruled in Mattel’s favor, the wildly successful dolls all but disappeared from stores as MGA pulled back on manufacturing and retailers kept their distance.
But when a federal appeals court in July overturned the 2008 ruling and ordered a retrial, MGA’s outspoken Chief Executive Isaac Larian triumphantly declared that he would be releasing a new line of Bratz dolls for the fall.
Updated versions of Sasha, Cloe, Jade and other popular Bratz dolls began to reappear on toy shelves in recent weeks, and 10 new characters are scheduled to be released Oct.
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Posted by Sean Cruz | Posted on 15-09-2010
Here’s what to do if a bill collector uses abusive tactics.
It’s stressful to be unable to pay your bills on time. It’s even more stressful to hear from a bill collector about those overdue debts. Although bill collectors can be persistent (that’s their job), many are careful to follow the law when contacting you. Unfortunately, some are not. If a bill collector oversteps the bounds of the law, you can take action.
The Fair Debt Collection Practices Act
The federal Fair Debt Collection Practices Act, or FDCPA (15 U.S.C. § 1692 and following), prohibits certain debt collectors from engaging in abusive behavior. It covers debt collectors who work for collection agencies. It does
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Posted by Heather Ward | Posted on 14-09-2010
This update is from Tax Analysts by way of Robert Keebler, CPA:
Obama administration officials are considering a proposal to allow taxpayers to elect to apply 2009 rules to their 2010 estate tax bills, a Treasury Department official said in an interview that aired September 12.
Treasury Assistant Secretary for Tax Policy Michael Mundaca said in a C-SPAN interview that the Obama administration would like to make permanent the 2009 iteration of the now-expired estate tax. The estate tax was allowed to lapse for 2010, and Congress has not agreed on a fix. Allowing taxpayers to retroactively apply the 2009 rates to their 2010 taxes is one possibility being considered, Mundaca said.
The option could prove appealing to taxpayers who have inherited estates worth less than the $3.5 million estate tax exemption for 2009 but more than $1.3 million.
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Posted by Heather Ward | Posted on 14-09-2010
Most people know that the proceeds of a life insurance policy are generally free of income taxes. What many don’t realize, however, is that the same proceeds are included in one’s estate for estate tax purposes.
The federal estate tax will be back next year with a rate of 55% for amounts over $1 million. This will mean that many folks who do not think of themselves as wealthy will have a significant estate tax problem in the event of their death.
However, this is an easy problem to fix. By creating an Irrevocable Life Insurance Trust (ILIT) and transferring the ownership of the policy to the trust, estate tax at the death of the insured (and the beneficiaries) can be avoided. For a transferred policy, the insured must survive by three years for the proceeds to escape taxation, but a newly issued policy in the name of the trust is immediately exempt.
I see a lot of clients who are reluctant to set up an ILIT because of the cost (usually $1,000 to $2,500 or so). Not chicken feed, but not much compared to the hundred of thousands of dollars the ILIT will save. People don’t think twice about spending $500 a year to insure a $20,000 car, but can’t justify a one-time expense of a couple of thousand dollars to save a couple of hundred thousand for the benefit of their family. Not logical.
That’s why I call the failure to create an ILIT estate planning’s costliest mistake. An ILIT is quickly and easily implemented by an experienced estate planning attorney, will not limit or complicate the ownership of your assets, and is a veritable bargain in comparison the benefit it will provide.
