by: Jeffrey Quinn
In these days of bureaucratic insanity surrounding us, at least one bright spot has emanated from Obama's Chiefie, Rahm Emanuel. In Rahm's memo to the heads of executive departments and federal agencies, he states that unless related to an emergency situation or other urgent circumstances, no proposed or final regulation should be sent to the Office of the Federal Register for publication until it has been reviewed and approved by a department or agency head appointed or designated by the President after noon on January 20, 2009.
We assume the edict applies to the IRS, so we may be temporarily freed from the flurry of regulations which regularly emanate from the Revenooers' offices.
Whew.
And from our "confusion reigns" department comes word, this week, that the rule allowing retirees over age 70-1/2 to forego their mandatory retirement distributions in 2009 seems to be creating more problems than it solves.
Designed to allow folks to refrain from selling IRA and other retirement plan assets at the present distressed market prices, just to fund the minimum annual distributions, it seems that some administrators of 401(k) plans, for one, are worried that the participants in their plans may not truly be allowed to suspend their withdrawals without amending the terms of their plans, or without further specific guidance/clarification from IRS. Also, some IRA custodians don't seem to have gotten the word yet, and are already pumping out checks to retirees, some of whom might just want to take up Uncle Sam on the one year suspension rule.
Bottom line seems to be that retirees who want to take advantage of this break should take the bull by the horns, and proactively get in touch with their custodians and set them straight before checks are issued which may have to later be returned.
And as we ponder bailouts and stimuli, some words of wisdom from David Brinkley's little tome, "Everyone Is Entitled to My Opinion" as penned on October 9, 1994:
"A sort of sweet-sad little tale. Stanley Newberg, an Austrian, fled
the persecution of the Jews and came to this country. He worked with his
father, a fruit peddler on the Lower East Side of New York City.
Years passed, he got into the aluminum business, did well and wound up
owning the company he worked in for years.
He died. He was eighty-one. He left $5.6 million. Left it to the U.S.
government. He said in his will: 'It is my expression of deep gratitude for
living in this kind of government, notwithstanding its inequities.' The
Bureau of Public Debt took his 5 million 6.
The sad part is that the government spends $4.1 billion a day. So Mr.
Newberg's $5 million, generously given, will disappear in less than
two minutes."
CONSULT YOUR TAX ADVISOR - This article contains general information about various tax matter. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He is also a contributor to the recently published twelfth edition of Tax Savvy for Small Business, published by Nolo. He can be reached at 831-7288, and welcomes comments at
jquinn@ashleyquinncpas.com.
