Capital Gains Tips from the IRS

It's that time of year again so here are some capital gains tips right from the IRS.


A tax tip from IRS.gov

Have you heard of capital gains and losses? If not, you may want to read up on them because they might have an impact on your tax return. The IRS wants you to know these ten facts about gains and losses and how they could affect your tax situation.

1) Almost everything you own and use for personal purposes, pleasure or investment is a capital asset.

2) When you sell a capital asset, the difference between the amount you sell it for and your basis -- which is usually what you paid for it -- is a capital gain or a capital loss.

3) You must report all capital gains.

4) You may deduct capital losses only on investment property, not on property held for personal use.

5) Capital gains and losses are classified as long-term or short-term, depending on how long you hold the property before you sell it. If you hold it more than one year, your capital gain or loss is long-term. If you hold it one year or less, your capital gain or loss is short-term.

6) If you have long-term gains in excess of your long-term losses, you have a net capital gain to the extent your net long-term capital gain is more than your net short-term capital loss, if any.

7) The tax rates that apply to net capital gain are generally lower than the tax rates that apply to other income. For 2009, the maximum capital gains rate for most people is 15%. For lower-income individuals, the rate may be 0% on some or all of the net capital gain. Special types of net capital gain can be taxed at 25% or 28%.

8) If your capital losses exceed your capital gains, the excess can be deducted on your tax return and used to reduce other income, such as wages, up to an annual limit of $3,000, or $1,500 if you are married filing separately.

9) If your total net capital loss is more than the yearly limit on capital loss deductions, you can carry over the unused part to the next year and treat it as if you incurred it in that next year.

10) Capital gains and losses are reported on Schedule D, Capital Gains and Losses, and then transferred to line 13 of Form 1040.

For more information about reporting capital gains and losses, see the Schedule D instructions, Publication 550, Investment Income and Expenses or Publication 17, Your Federal Income Tax. All forms and publications are available at IRS.gov or by calling 800-TAX-FORM (800-829-3676).

Web Hosting Disaster- Severe Data Loss Occured

The words I never wanted to hear were "your web accounts were hacked by terrorists and all of your data is lost forever". The web host company is Direct Horizon and I seriously recommend never to use them. Hackers were able to penetrate their shared servers and delete entire accounts, email databases and the backups that went with them. They have no record of any of my 5 web sites or my entire database of email customers. It's like I never existed as their customer.

I do have backups of my websites which will be a pain to get back up and running on a new web host, but I was never told I needed to back up my autoresponder with my email list of 20,000 names which I have cultivated and nurtured for over 6 years. This was ARP3 autoresponder and I mistakenly assumed it was kept separate and secure like my Aweber account is. Had I known it could be easily deleted of course I would have kept my own backups. It seems to me in these days of technology and assurances of security by web hosting companies things this devastating should not occur.

Direct Horizon bought out the original hosting company named Fat Jack and I stayed with them because they migrated my ARP3 list with my accounts and it was going to be a pain to find another host which supported ART3. Big mistake.

Direct Horizon blames me for not having a backup and takes no responsibility for being hacked and losing client accounts. Their response was I should have had my own dedicated server for a lot more money each month and then this would not have happened. They wanted to know if I wanted to set that up now. Are you kidding me?????

I now am forced to start over from scratch. I have a limited amount of people who have emailed me that I can contact gradually and let them know what happened. Unfortunately the majority will probably wonder why they have stopped getting updates and I will never know who they are to explain.

If you are reading this post and were on my list, please email me and I will get you set up on my new list just as soon as I get things going again.

Let my tragedy be a lesson to anyone with websites or ARP3 autoresponders. Back up everything you have on your web hosting account because it might not be there tomorrow.

Luckily, my blog and main website www.savegainstax.com were not affected because they are hosted by reliable companies. I will be moving my other websites to these hosts soon.

Believe me, I will be backing up everything I possibly can from now on.

Paula Straub
savegainstax@gmail.com
760-917-0858

Happy Holidays!

No matter what faith you observe, I just want to take a minute and wish you a Happy Holiday season.

It's almost impossible to do much business at this time of year, and most emails are answered with "out of office" messages. Who doesn't crave some hard earned time off?

It is my wish for everyone that 2010 ushers in a new era of hope and begins a turnaround for ailing businesses and unemployed individuals who just want to get back to work and support their families.

I'd like to think decent health care will be available to all, but I'm not as encouraged by what I am seeing evolve as new legislation. If only our elected members of both houses would work together in the best interest of the people in this great country instead of pursuing their own selfish ends we might actually create a system that works.

Hope you all have great times with family and friends and that 2010 brings health, wealth and happiness to all those who deserve it.

If you want to help your favorite charity or non-profit provide for their cause, pass them to this link and have them contact me. I'd like to help. Help Your Charity Now

Paula Straub
760-917-0858
savegainstax@gmail.com

Tax Nightmares on the Horizon for 2010

With the government bodies embroiled in the health care debate and trying to get something passed by year’s end, they have failed to enact the proper laws to deal with estate tax issues for 2010.

Several options have been brought up for vote, but none have passed both Houses.

So, this leaves us at least for now with there being no estate tax in 2010- which might be good for the families of a few very wealthy individuals who pass away. However, if this happens, thousands of less wealthy families may pay much more in capital gains tax, as the step up in basis for inherited property goes out the window. Not a good trade off for the average middle class.

Several options have been passed around, such as extending the current rule for another year until they have time to give this more attention, increasing the estate tax exclusion and making it permanent, changing the rates at which it is taxed, etc.

Odds are very good something will be enacted sometime next year and be made retroactive to January 1. This opens up all types of lawsuits for people who pass away before the law is passed and would have benefitted from the ruling in place at the time.

One thing I’m fairly certain of is that this will not end particularly well. I swear we elect some really inept people into government who mess up more than they ever fix. Stay tuned for future updates.

Paula Straub
www.savegainstax.com
760-917-0858

Learn how to help your favorite non-profit by checking out this link:
www.savegainstax.com/legacy.html

You or Your Family Member Needs Assisted Care- Now How Do You Pay For It?

I was asked to write an article for a local publication so I thought I'd pass on the info here as well.

More often than not we prefer not to think of the time we or our family member s will need the assistance of another person or place to help with our physical or mental needs. In our minds it happens to other people but not to us.

However, it does happen and we are rarely prepared. It might be a sudden stroke, the onset of dementia, complications after surgery or a fall, macular degeneration or simply just getting more frail as we naturally age.

Now we have to pay someone to come to our homes, move in with family, move to assisted living or even to a 24 hour care facility. Costs can run from an average of $20/hr for homecare to 3 to 7 thousand or more per month.

A lifetime of savings can disappear in months and a spouse may become impoverished if the other spouse requires extended care. Medicare does not cover many costs of this type and the state welfare program, Medical , only kicks in once your savings are gone- and then your choices are limited home care or a nursing facility of their choice.

So, what are some options to pay for care? Limited space cannot afford much detail, but here are some choices:

· Long Term Care Policies, purchased prior to need, can be worth their weight in gold and well worth the premiums paid. They come in all shapes and sizes and should be geared to your personal situation and budget

· There are now both life insurance policies and annuities that have long term care riders which allow for financial benefits should long term care be needed in the future.

· There are companies that may offer lump sum payments for such things as no longer needed life policies, annuities in payout, and even interests in established CRTs. These don’t apply to everyone, but it pays to know about them in case they do.

· There are some benefits for veterans and surviving spouses under the VA non service connected Improved Pension Benefit with aid and attendance add on.

· If you need to sell assets such as appreciated real estate, there are tax saving strategies that will allow you to keep more of the value of your asset and minimize your tax obligations. These need to be put in place prior to the sale.

· There may be some foundations, churches and charities that provide support services.
· Family members may be able to chip in or you might share some services with a neighbor.

It really helps to do some checking into facilities and home care companies prior to needing them. Scrambling for information when the need is a reality might lead to bad experiences and loss of precious savings. Also, be sure you have a power of attorney document for both medical and financial decisions. Let your preferences be known to those you trust so the decision for your care is not left up to the courts and strangers.

For more information on any of the above, call Paula Straub at 760-917-0858 or email Paula at savegainstax@gmail.com

How A New Fundraising Strategy Can Help Your Charity

In speaking with a number of charities recently, I notice a big difference between those who have workers that are in it for the cause and those who just subsist in order to collect a paycheck. A bit like politicians, I think, who should be in politics to serve the public but often just serve themselves.

Anyway, in order to find a way to help those who really do want to see their mission succeed, I put up a web page that can provide an overview of the benefits of a new charitable fund raising strategy, watch a recent interview with the developer of it and then contact me if more details are desired.

Here is the link:

http://www.savegainstax.com/legacy.html

Feel free to forward this to any charity you believe can benefit from additional funds. This is not a magic bullet or a cure all for every non-profit, but when it works it works extremely well and everybody wins.

Paula Straub
http://www.savegainstax.com/
760-917-0858

Do You Support A Worthwhile Cause?

There are so many good Charities and Non-Profits who are really hurting these days because donations are down just when money is most needed.

I have an important favor to ask of you and it won’t cost you a dime.

I want you to email me, fax me or call me with the name of your favorite charity and the contact information for the person who is responsible for fund raising. That’s it.

It can be a school, church, research foundation, animal charity or any legitimate non profit you feel is doing good work and in need of additional donations.

I will invite them personally to a webinar introducing a brand new way to raise significant immediate donations that has no cost to the organization and no net out of pocket cost to the supporter. There are no risky financial tools used.

In all my years of financial planning, I haven’t seen a better win-win situation for both parties when the fit is right.

This will be by invitation only and only open to non-profits. It will take 45 minutes of their time from the comfort of their home or office and they can decide if they want to find out more after attending.

I personally guarantee they have not seen this method before and their time will be well spent.

So, help me help your favorite charity. Feel free to forward this post to anyone who supports a good cause. You can make a difference.

Paula Straub
savegainstax@gmail.com
760-917-0858 phone
866-401-0424 fax