Don’t Spend It All In One Place
Funny how the politicians always seem to synchronize proposed giveaways with the election cycle. And indeed, the culmination of this cycle is just around the corner – no surprise, then, with regard to the timing of Obama’s latest “gift” for (certain) beleaguered taxpayers: a $250 “economic recovery payment” to seniors, veterans, and folks with disabilities. A reprise of the similar program which came up in 2009, when some 56 million people received a $250 stimulus check.
Your leader’s suggestion came, of course, just last Friday, when the Social Security Administration announced that there would be no cost of living adjustment (COLA) for social Security benefits yet again, this year.
But the nonpartisan Center for a Responsible Federal Budget expressed the view that it would be fiscally irresponsible to issue one-time payments to Social Security recipients just because there will be no COLA. And let us not overlook the words of President Obama, himself, also last week who noted that “all options are on the table” for fixing Social Security – we can hardly wait for the December 1 report to be issued by Obama’s bipartisan fiscal commission.
And in other news, IRS has announced that employers won’t have to report the aggregate cost of employer-sponsored health insurance on employee Forms W-2 issued for 2011. Reporting will be optional, and employers taking advantage of the “stay” won’t be subjected to any penalties.
Recall that such reporting was originally put forth in the Patient Protection and Affordable Care Act of 2010 (“Obamacare”), and since the March enactment has been the subject of a whole lot of misinformation on the part of some analysts who have been circulating word that employees would actually be taxed on the amount of employer health insurance premium payments.
And finally for you history buffs out there, let’s review the record on just how Obama and his minions have carefully shaded their comments, over the last couple of years, when it comes to the ever-popular subject of possible tax increases.
~Obama – September 12, 2008: “And I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”
~Geithner – August 2, 2009: “We can’t make these judgments yet about what exactly it’s going to take and we’re going to get there. I think what the country needs to do is understand we’re going to have to do what it takes, we’re going to do what’s necessary.”
~Obama – September 9, 2010: When asked during an TV news interview whether he would support a two-year extension of all of the “Bush tax cuts,” Obama suggested that would not be a “smart thing” for the economy, noting that the reason no tax package had yet passed was because “we haven’t seen compromise from the other side.”
Maybe someone will take some action by Christmas.
“Which Christmas?” you ask.
CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters. 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 13th edition of Tax Savvy for Small Business, published by Nolo. He can be reached at 831-7288, and welcomes comments below.