Category Archives: Economy

Obama’s IRS plotted to imprison conservatives

While it is proper for the federal government to use the judicial system to go after tax cheats, it is ENTIRELY improper for the government to SELECTIVELY go after suspected tax cheats on a partisan basis.

That is what Obama and his IRS are doing, which the nonpartisan citizen watchdog group Judicial Watch has discovered from emails of former IRS official Lois Lerner, but only after filing repeated Freedom of Information Act (FOIA) lawsuits.

Those emails also show that:

  • Lois Lerner knew full well the IRS was — and still is — targeting conservative groups, esp. Tea Party groups, for extra scrutiny.
  • Lerner knew full well that singling out conservative groups for prosecution is not lawful or in her euphemistic words, “not realistic under current law.”
  • Lerner was scapegoating when she blamed the targeting of conservative groups on “low level” IRS workers in Cincinnati.
  • Not only is the IRS complicit, Eric Holder’s Department of (in)Justice is also complicit, because Lerner was plotting with DOJ on how to prosecute conservative groups for alleged tax violation.

~Eowyn

Eye of ObamaJW Obtains IRS Documents Showing Lerner in Contact With DOJ about Potential Prosecution of Tax-Exempt Groups

APRIL 16, 2014

May 9, 2013, email reveals IRS plans to meet with Department of Justice over whether to prosecute groups that “lied” about plans for political activity 

(Washington, DC) – Judicial Watch today released a new batch of internal IRS documents revealing that former IRS official Lois Lerner communicated with the Department of Justice (DOJ) about whether it was possible to criminally prosecute certain tax-exempt entities. The documents were obtained as a result of an October 2013 Judicial Watch Freedom of Information Act (FOIA) lawsuit filed against the Internal Revenue Service (IRS) after the agency refused to respond to four FOIA requests dating back to May 2013.

Lois Lerner

Lois Lerner

The newly released IRS documents contain an email exchange between Lerner and Nikole C. Flax, then-Chief of Staff to then-Acting IRS Commissioner Steven T. Miller discussing plans to work with the DOJ  to prosecute nonprofit groups that “lied” (Lerner’s quotation marks) about political activities. The exchange includes the following:

I got a call today from Richard Pilger Director Elections Crimes Branch at DOJ … He wanted to know who at IRS the DOJ folk s [sic] could talk to about Sen. Whitehouse idea at the hearing that DOJ could piece together false statement cases about applicants who “lied” on their 1024s –saying they weren’t planning on doing political activity, and then turning around and making large visible political expenditures. DOJ is feeling like it needs to respond, but want to talk to the right folks at IRS to see whether there are impediments from our side and what, if any damage this might do to IRS programs.

I told him that sounded like we might need several folks from IRS…

I think we should do it – also need to include CI [Criminal Investigation Division], which we can help coordinate. Also, we need to reach out to FEC. Does it make sense to consider including them in this or keep it separate?

Lerner then “handed off” scheduling the issue to Senior Technical Adviser, Attorney Nancy Marks, who was then supposed to set up the meeting with the DOJ.  Lerner also decided that it would be DOJ’s decision as to whether representatives from the Federal Election Commission would attend.

Democratic Rhode Island Senator Sheldon Whitehouse had held a hearing on April 9 during which, “in questioning the witnesses from DOJ and IRS, Whitehouse asked why they have not prosecuted 501(c)(4) groups that have seemingly made false statements about their political activities.”  Lerner described the impetus for this hearing in a March 27, 2013, email to top IRS staff:

As I mentioned yesterday — there are several groups of folks from the FEC world that are pushing tax fraud prosecution for c4s who report they are not conducting political activity when they are (or these folks think they are). One is my ex-boss Larry Noble (former General Counsel at the FEC), who is now president of Americans for Campaign Reform. This is their latest push to shut these down. One IRS prosecution would make an impact and they wouldn’t feel so comfortable doing the stuff.

So, don’t be fooled about how this is being articulated – it is ALL about 501(c)(4) orgs and political activity

But in an email sent a few minutes earlier, Lerner acknowledged prosecutions would evidently be at odds with the law:

Whether there was a false statement or fraud regarding an [sic] description of an alleged political expenditure that doesn’t say vote for or vote against is not realistic under current law. Everyone is looking for a magic bullet or scapegoat — there isn’t one. The law in this area is just hard.

The documents also include email exchanges showing that before Lerner’s May 10, 2013, speech to the American Bar Association blaming “low-level” employees in Cincinnati for targeting tax-exempt organizations, the IRS Exempt Organizations division was scrambling to defuse the emerging targeting scandal:

  • May 1, 2013: After receiving an email from an assistant showing that 501(c)(4) applications had increased from 1591 in 2010 to 3398 in 2012 , Lerner wrote back, “Looks to me like 2010-2012 doubled too. Oh well – thanks.”
  • May 2, 2013: Discussing an upcoming conference call with approximately 100 congressional staffers on May 22, Lerner cautions aides, “Need to be careful not to mention sequester/furlough unless asked although can allude to budget and resources restraints.”
  • May 2, 2013: In response to an email reminding her about the upcoming conference call with congressional staffers, Lerner responded, “Arrgh – I just saw it. Sharon [White] could skate, but Cindy [Thomas] is the person who could answer that stuff. We need to give them some type of language in the event that type of question comes up” [apparently in reference to earlier email referencing “sensitive issues”].

The new documents obtained by Judicial Watch also include emails exchanged after Lerner’s May 10 ABA speech:

  • May 10, 2013: In an email to an aide responding to a request for information from a Washington Post reporter, Lerner admits that she “can’t confirm that there was anyone on the other side of the political spectrum” who had been targeted by the IRS. She then adds that “The one with the names used were only know [sic] because they have been very loud in the press.”
  • May 15, 2013: In an email from an aide to Lerner, the aide specifically mentions “Tea Party Organizations, the “Tea Party movement,” and “Tea Party Patriots” as organizations targeted by the IRS.

The Judicial Watch FOIA requests came on the heels of an explosive May 14, 2013, Treasury Inspector General report revealing that the IRS had singled out groups with conservative-sounding terms such as “patriot” and “Tea Party” in their titles when applying for tax-exempt status. The IG probe determined that “Early in Calendar Year 2010, the IRS began using inappropriate criteria to identify organizations applying for tax-exempt status to (e.g., lists of past and future donors).” According to the report, the illegal IRS reviews continued for more than 18 months and “delayed processing of targeted groups’ applications” preparing for the 2012 presidential election.

Lerner, who headed the IRS division that handles applications for tax-exempt status, refused to testify at a May 2013 hearing before Rep. Darrell Issa’s (R-CA) House Oversight Committee, demanding immunity concerning her role in the targeting scandal. Lerner retired from the IRS with full benefits on September 23 after an internal investigation found she was guilty of “neglect of duties” and was going to call for her ouster, according to news reports. On April 9, 2014, the Ways and Means Committee referred Lois Lerner to the DOJ for criminal prosecution. On April 10, 2014, the House Oversight Committee voted to hold Lerner in contempt of Congress.

“These new emails show that the day before she broke the news of the IRS scandal, Lois Lerner was talking to a top Obama Justice Department official about whether the DOJ could prosecute the very same organizations that the IRS had already improperly targeted,” said Judicial Watch President Tom Fitton. “The IRS emails show Eric Holder’s Department of Justice is now implicated and conflicted in the IRS scandal.  No wonder we had to sue in federal court to get these documents.”

IRS considers taxing work perks like food, gym memberships

irs

Fox News: In competitive job markets like Silicon Valley, companies are doing everything they can to entice the best and brightest — offering freebies that have become the stuff of legend.

Employee perks like free food at lavish cafeterias, laundry and even yoga are not unheard of.

The IRS reportedly is looking at these perks and seeing if these companies need to start paying up for the free stuff they offer employees. 

David Gamage, a tax expert and professor at the University of California, Berkeley, said it would really boil down to who benefits from these perks.

“To what extent is this intended as a perk, a form of compensation, for the benefit of the employee, or to what extent is this just another way the employer gets the employee to work harder and longer and do things for the benefit of the employer?” he said.

If it’s the latter, then it’s harder for the IRS to tax it.

The Wall Street Journal first reported that the agency is considering whether the freebies like food, shuttles, haircuts and more are really fringe benefits on which workers should be taxed. Some tax experts see the perks as skirting the edges of the law, and warn the companies may be violating it — but also think it would be a very aggressive move for the already-busy IRS to pursue this when they have much more on their plate (like prosecuting conservative tax-exempt groups).

Silicon Valley-based Clari, which has several dozen staffers developing cloud technology for smart phones, is one such company that offers free food — to workers who rarely leave their desks.

CEO and co-founder Andy Byrne argues that providing good, healthy food is a necessity, not a luxury, and that everyone benefits. 

“They win [because] they’re happier, our customers win [because] they get a higher quality product and then our shareholders win because they see our momentum in the market. For a small company like Clari, the idea of taxing the perks would have a devastating effect, not only for the employers who would have to cancel the perk, but also for the workers who would have lower productivity,” he said.

IRS officials declined to comment for this article.

According to Gamage, these perks have become a necessity in the workplace.  “Tech is a really competitive world at the high end, in terms of employers recruiting the top talent, and employers have responded; not just by paying high salaries, but by providing all sorts of perks,” he said.

Even if the IRS does crack down on this perk, the high-tech lunch isn’t likely to completely disappear. Legal experts suspect most companies will probably just report it as “taxable income” to employees and then pay them more in salary to cover the cost.

DCG

The real meaning of April 15th

April 15

H/t John Rolls of the Rolls Report

~Eowyn

Most public pensions may run out of money in 30 years

pensions

Watchdog.org: Public pension systems across the country may be heading toward a financial meltdown, according to a series of stress tests conducted by a respected hedge fund.

Bridgewater Associates, based in Wesport, Conn., estimates it will take about $10 trillion for public pensions to meet their financial obligations in the coming decades as an aging population retires, but according to Bridgewater’s report there is only about $3 trillion in assets to invest.

In order to cover the coming expenses, Bridgewater estimates pension plans would need to earn an annual return of 9 percent.

The report said most states’ public pension systems work on a presumption of a 7-8 percent annual return on their investments, but Bridgewater says a more realistic goal is 4 percent — or even less.

Given all those factors, Bridgewater’s report concludes that as much as 85 percent of public pension plans could run out of money within three decades.

New Mexico’s two big public pension plans — the Public Employees Retirement Association and the Educational Retirement Board — work on presumptions of annual returns of almost 8 percent.

On the other hand, New Mexico is one of the few states that have passed a pension reform “fix” to try to tackle the looming financial problem.

In the 2013 legislative session, Republicans and Democrats — working with PERA, ERB and the state’s chapter of American Federation of State County and Municipal Employees — hammered out bills aimed at shoring up pension solvency.

“We haven’t let ours go completely in the cellar,” said state Sen. Stuart Ingle, R-Portales, who sponsored the ERB fix. “We tried to tackle the problem and I’m hopeful that we solved it. But our investments have to make some money. If not, we’ll have to come back and change them.”

State Sen. George Muñoz, D-Gallup, spearheaded PERA pension reform in the 2013 session, but worries about the annual rate of return assumptions.

“I think the 6 percent range, 6 and three-quarters” is more realistic, Muñoz told New Mexico Watchdog. “You’re floating that line. The economy is such a rollercoaster, there are no flat line projections where you can get a solid smoothing over for a three to five year period.”

The ERB plan works on a presumption of 7.75 percent a year. That’s pretty high, but last month ERB reported its investment portfolio returned 11.7 percent for the calendar year.

Ingle said adjustments may be needed in the future, but is relieved New Mexico passed the pension bill. “Before, it was a like a gusher,” he said. “Now there’s a certain stream of money going out, but the pipe’s cut down from 12 inches to maybe three.”

DCG

Wayne Allyn Root on the Nevada Standoff

Wayne Allyn Root

WHAT HAPPENS IN VEGAS, MAY SPARK AN AMERICAN REVOLUTION

Posted by Wayne Root on April 12, 2014

By Wayne Allyn Root

Forget the Ukraine. The real revolution is happening right now north of Las Vegas where a rancher is under assault by the U.S. government.

Remember that famous Las Vegas advertising slogan, “What Happens in Vegas Stays in Vegas.” Well when it comes to big government stealing our property and violating our rights, it’s just not true. What’s happening in Vegas is symbolic of what’s happening across this once great country.

This federal government assault on a Nevada ranching family looks a lot like the Gestapo, the Stasi, or any other authoritarian Big Brother force that persecutes, intimidates and controls the people with an iron boot. Think I’m exaggerating? How about a Las Vegas elected official (County Commissioner Tom Collins) warning out of state protestors “to make funeral plans.” This isn’t Ukraine, or Moscow. That was a Las Vegas politician threatening to have government agents murder law-abiding protesters. https://www.reviewjournal.com/news/water-environment/collins-manages-insult-utahns-comments-bundy-roundup

My Jewish grandparents told me “Never forget.” What they meant was, “We must never forget the Holocaust and what happened to our people.” Well it’s time to remember, before America is no longer the land of the free! Before your free speech is corralled into a “First Amendment Area.” Before government can steal your land and take away your rights based on trumped up charges. Before government can use force to taser legal non-violent protesters. Before someone is killed by masked government snipers with AK47’s trained on American citizens.

Don’t look now. It’s happening. This is an offshoot of Obama’s plan for America- an open distaste and disgust for ranchers, farmers, hunters, capitalist owners of land. Obama hates independence. Under this administration we have record numbers of welfare, food stamp, disability and unemployment insurance. We have a government spending record money advertising to entice more Americans – even illegal immigrants- to accept food stamps and entitlement checks. We’ve given up on enforcing illegal immigration.

Obama treasures a nation filled with people who are desperate, helpless and dependent on government checks. He desperately needs to stamp out independent and self-reliant Americans who want nothing to do with the government. Look no further than this declaration of war upon a productive, taxpaying Nevada rancher family.

Obama always shows his hand with the three-letter government organizations- IRS, NSA, EPA, ATF, FDA, SEC. Obama uses them to target, intimidate and persecute his critics and political opponents. Now it’s time for a new 3-letter threat: BLM (Bureau of Land Management).

The federal government has surrounded the Bundy family ranch outside Las Vegas with snipers, heavily militarized police, vicious police dogs, black SUV’s, helicopters, low flying airplanes and automatic weapons. Cliven Bundy, is a patriotic rancher whose family has had the right to graze his cattle on this land since the 1870’s. Since before there was a BLM. Bundy does not believe he owes fees to the BLM. He recognizes this as a States’ Rights issue. http://danaloeschradio.com/the-real-story-of-the-bundy-ranch/

After well over a century with grazing rights on this land, suddenly in the 1990’s the federal government demanded rent to allow the Bundy family’s cattle to graze on it. Bundy claims his rights to graze came from the State of Nevada, not the BLM, and has already paid fees to Clark County, Nevada. Bundy already owns the water and forage rights to the land. http://danaloeschradio.com/the-real-story-of-the-bundy-ranch/

The feds blame this assault on the fact that desert tortoises reside on this land. The government is now using the tortoise as their “cover” for an armed assault on an American ranching family. Yet it is important to note that this same BLM has waived rules protecting the desert tortoise on numerous occasions to support wind and solar projects favored by U.S. Senate Majority Leader Harry Reid. http://www.defenders.org/press-release/bureau-land-management-solar-plan-guides-energy-development-lower-conflict-areas.

http://www.windaction.org/posts/36964-lawsuit-searchlight-wind-energy-project-complaint#.U0jKnFzlQ-B

The BLM says Bundy owes $1.1 million in grazing fees (ostensibly to protest the desert tortoise) and has decided to use lethal force, positioning snipers on hilltops to perhaps shoot our own citizens. They’ve sicced vicious guard dogs on a pregnant woman. http://drleonardcoldwell.com/2014/04/10/feds-assault-cancer-victim-pregnant-woman-in-clash-with-bundy-supporters/

They’ve tasered and arrested members of the Bundy family for standing up to a force killing and stealing their property. http://www.theblaze.com/stories/2014/04/10/tense-video-feds-taser-pro-nevada-rancher-protester-during-clash/

Bundy’s sister (a cancer victim) was thrown to the ground. Son Dave Bundy was beaten, bruised and arrested by this Gestapo-like force for the crime of…taking photos outside “the First Amendment Area.” http://mvprogress.com/2014/04/09/bundy’s-son-arrested-in-roundup-incident-public-protest-results/

And they’ve tried to banish protestors to a “First Amendment Area” where free speech is “allowed.” Funny, I thought free speech was a right everywhere on American soil? http://www.americasfreedomfighters.com/2014/04/11/blm-feds-assault-more-protesters-as-first-amendment-area-taken-down/

This is happening in America. Our country.

Nevada Governor Brian Sandoval (a very moderate Republican) is angered by the federal government assault on property and States’ Rights. Sandoval said, “No cow justifies the atmosphere of intimidation which currently exists, nor the limitation of constitutional rights that are sacred to all Nevadans. The BLM needs to reconsider its approach to this matter and act accordingly.”

Nevada U.S. Senator Dean Heller told BLM Director Neil Kornze, “…law-abiding Nevadans must not be penalized by an over-reaching BLM.”

Between you and me, I think these are both very weak statements for government overreach this dramatic.

Clive Bundy used to have 52 rancher neighbors. They are all gone. He is the last man standing because the BLM has regulated ranchers out of business in favor of tortoises and green energy projects.

Government isn’t just brutal, vicious and over-reaching. Government is hypocritical. This same government that is supposedly acting to protect desert tortoises, killed hundreds of these same tortoises only a year ago because they didn’t have the funding to take care of them. http://www.infowars.com/before-nevada-cattle-rancher-dispute-blm-was-euthanizing-endangered-desert-tortoise/

Even more to the point, why protect desert tortoises if you’re killing cattle? Rendering trucks have been spotted at the government assault. For you city folk, rendering trucks are used to transport dead cattle. Bundy believes cattle are dropping dead in 90 degree heat after being chased by government helicopters.

http://www.wnd.com/2014/04/feds-charged-with-killing-cattle-in-nevada-range-war/

Then there’s the glaring conflicts of interest in this case. Is the Clark County Sheriff Doug Gillespie refusing to intervene on behalf of a Nevada family because he is afraid of losing Homeland Security funding? The Sheriff is on the Board of Directors of The Nevada Commission on Homeland Security. http://dem.nv.gov/uploadedFiles/demnvgov/content/homeland_security/APPROVED%20MINUTES_NCHS_062113_klh.pdf

And there are now reports that U.S. Senator Harry Reid and his powerful attorney son Rory Reid want Bundy’s cattle off the land to make room for a $5 billion dollar Chinese solar project.

http://www.infowars.com/breaking-sen-harry-reid-behind-blm-land-grab-of-bundy-ranch/

After Cliven Bundy’s property and rights are taken away, who will be next? Who knows what justification the BLM or corrupt government bullies like Harry Reid will use to steal your property, or beat your son for daring to take photos, or taser your pregnant daughter, or push to the ground your cancer-surviving wife.

Wake up America. Either we stand up to Big Brother, or everything our great Founding Fathers fought for will soon be gone.
– See more at: http://www.rootforamerica.com/webroot/blog/#sthash.vByTm8wn.dpuf

America’s retail apocalypse: Now it’s Family Dollar & Coldwater Creek

O laughs

Tiffany Hsu reports for The Los Angeles Times, April 10, 2014, that the North Carolina discount retail chain Family Dollar Stores Inc. said it would close 370 under-performing stores later this year and slash prices on 1,000 products after its profit for the second quarter plunged more than 30%.

Family Dollar has 8,100 stores across the country.

Tiffany Hsu reports for L.A. Times, April 11, 2014, that Coldwater Creek Inc., a women’s wear retailer with hundreds of stores nationwide, has filed for Chapter 11 in federal bankruptcy court in Delaware, listing $278.5 million in assets and $361.3 million in debt.

The company will start liquidating the business with deep discounts pegged to Mother’s Day.

The Sandpoint, Idaho, company, which started with a catalog model in 1984, has 334 retail stores, 31 outlet locations and seven day spas. California has 27 Coldwater Creek stores — more than any other state except Texas.

Coldwater Creek has 339 employees in its corporate headquarters and more than 5,500 other workers throughout the system.

H/t FOTM’s CSM

See also:

~Eowyn

Ding Dong The Witch Is Gone! Sebelius Resigns.

And the people rejoice.

And the people rejoice.

—————————————————————————————————-

HHS Secretary Sebelius resigning on heels of ObamaCare rollout

Harvard study: Your share of the federal debt is $106,000

taxpayer

Washington Examiner: American workers would have to cough up a one-time “debt reduction fee” of $106,000 to pay off the nation’s debt that has grown 58 percent under President Obama, according to Harvard University’s Institute of Politics annual report on the USA.

The 91-page report provided to Secrets pegged the nation’s debt at $16.7 trillion, up from the $10.6 trillion inherited by Obama. “The debt has grown so quickly because of large and repeated annual deficits in federal spending,” said the report.

What’s more, the Annual Report of the USA, from the student at the Harvard Political Review and done in partnership with the American Education Foundation, found that food stamp usage has surged 77 percent during the recession and that Social Security benefits will be slashed 23 percent starting in 2033 unless Congress and the White House institute sweeping reforms.

The report is considered one of the nation’s authoritative independent analysis review of federal spending. One of the best benefits of the report is that the authors try to put huge numbers like the debt in perspective.

“Such large sums are difficult to conceptualize properly,” said the student authors in their report.

“If the federal government spent its yearly revenues exclusively on debt reduction and ceased all of its operations, it would take three of four years to pay down the debt. Or, the government could pay down the debt in one blow if it simply took more than $52,000 from every person living in the U.S., including children, the elderly, and the unemployed. If this one-time ‘debt reduction fee’ were levied only on those in the workforce, the cost would be over $106,000 per person,” warned the report.

It also revealed how desperate American families have struggled during the recession that struck at the end of the Bush administration and has lasted through Obama’s two terms: food stamp participation has surged 77 percent and funding more than doubled to $71.8 billion.

Harvard said that from the beginning of the recession in late 2007, average monthly participation in the program jumped to historic levels and an annual bill of $30.4 billion.

The news isn’t much better on the Social Security front: “Without reform, Social Security beneficiaries will face a 23 percent benefit cut in 2033. By 2087, beneficiaries will receive 28 percent less than calculated under the current benefit formula.”

DCG

Majority of Americans unprepared if economy collapses

Apocalypse

In the 2013 Brad Pitt movie, World War Z, unlike all the world’s other governments caught in the normalcy bias, the government of Israel had a Tenth Man policy which enabled Israel to take seriously an early warning about the impending zombie apocalypse and so secured its borders.

According to the tenth man policy, when nine people agree on something, it’s the tenth man’s responsibility to disagree no matter how improbable the idea.

The normalcy bias refers to human beings’ predisposition to underestimate both the possibility of a disaster occurring and its possible effects. Our erroneous assumption is that since a disaster hasn’t occurred, then it never will occur. We then downplay the likelihood of a disaster while, at the same time, interpret warnings in the most optimistic way possible or ignore those warnings entirely.

Our normalcy bias results in our failure as individuals and government to adequately prepare for a disaster, as well as our inability to cope when disaster does strike.

Michael Snyder of The Economic Collapse warns that America is “steamrolling toward the edge of an economic cliff” because “the long-term trends that are destroying our economy have continued to get worse since 2008, and none of the problems that caused the last financial crisis have been fixed.” Most Americans “in our entertainment-addicted society are totally oblivious to what is going on. So they are not doing anything to get ready for the immense economic pain that is coming.”

Are you prepared for the coming economic collapse? Here are 5 questions to ask yourself:

1. Can you come up with $2,000 right now? According to a shocking study by Atif Mian of Princeton University and Amir Sufi of the University of Chicago Booth School of Business, 40% of Americans said they could not come up with $2,000 if an unexpected need arose.

2. Do you have 3 months of income saved in an emergency fund? In that same study, an astounding 60% of Americans said they do not have 3 months emergency funds to cover expenses in case of sickness, job loss, or an economic downturn.

3. Are you living paycheck to paycheck? Another study found that 76% of Americans are living paycheck to paycheck. Less than one out of every four Americans (25%) has enough money stored away to cover six months of expenses.

4. How dependent are you on government benefits? More Americans are dependent on the government than ever before. According to the U.S. Census Bureau, 49% of U.S. households receive and depend on direct monetary benefits from the federal government.

5. How prepared are you for an emergency lasting just a few days? According to a survey conducted by the Adelphi Center for Health Innovation:

  • 44% don’t have first-aid kits
  • 48% lack emergency supplies
  • 53% do not have a minimum three-day supply of nonperishable food and water at home
  • 55% believe local authorities will come to their rescue if disaster strikes
  • 52% have not designated a family meeting place if they are separated during an emergency
  • 42% do not know the phone numbers of all of their immediate family members
  • 21% don’t know if their workplace has an emergency preparedness plan
  • 37% do not have a list of the drugs they are taking
  • 52% do not have copies of health insurance documents

What do you think is going to happen to these people once the economy collapses and there is chaos in the streets?

One reason why so many Americans are unprepared for an economic disaster is because we are being taxed into oblivion. Americans — the 56.7% of us who actually pay income taxes — now spend more on taxes than we spend on food, clothing and housing combined.

~Eowyn

New York rich face tax surprise when they die

taxedtodeath2

CNBC: If you’re a New York multimillionaire, you now have another incentive to stay alive.

A change this month in New York’s estate tax, which was billed as tax relief for the wealthy, contains a hidden wrinkle that could leave some multimillionaires with a much bigger surprise tax upon their death. Certain estates could even wind up with a tax rate of 164 percent on portions of their estates, according to one tax expert.

The changes were intended to ease the tax bill for wealthy New Yorkers and prevent them from fleeing to lower-tax states. A report from the Tax Foundation found that New York had the highest tax burden in the country as a percentage of state income. It found that New Yorkers spent 12.6 percent of their per capita income in 2011 on state and local taxes.

Instead of lowering the tax bill, the tax changes could hit some estates with much higher-than-expected rates.

“It’s nonsensical,” said Kevin Matz, an accountant and attorney in White Plains, N.Y. “The governor said this is about making New York a better climate for the wealthy. It’s had the opposite effect.”

On its face, the new law seems like tax relief. Under the previous law, New Yorkers paid estate taxes of 3.06 percent to 16 percent on the value of estates over $1 million. The new law raises that exclusion to $2.062 million this year and gradually increases it to more than $5 million by 2017.

But because the law also phases out certain credits related to federal taxes, people who have estates valued just above the $2 million threshold could get massive estate tax bills. An analysis by U.S. Trust found that a New York resident who dies today with a taxable estate of $2,165,625 could have to pay an estate tax of over $112,050. That represents a tax of over 100 percent on the value of the estate over $2,062,000.

It gets worse in a few years. Matz said that assuming that the exclusion rises to $5,250,000, a New Yorker with a taxable estate of $5,512,500 would have to pay an estate tax of $430,050. That’s a marginal tax rate of 164 percent on the value of the estate above the exclusion.

It’s a bait and switch,” Matz said. The solution, he said, is to not phase out the tax credits. Or, the state could also allow them to phase out over a much longer period of time.

The New York State Society of CPAs and other groups have sent letters to New York lawmakers in hopes of getting a quick fix. So far, there has been little response.

A spokesman for the New York State Division of the Budget said that while the marginal rates may have changed, “No one’s taxes have gone up. The dollar amount they pay does not increase.”

He added that the tax change has insured that by the time it’s fully implemented in 2017, 90 percent of New York’s estates will no longer be taxed.

Matz, however, said the issue is not just a problem for the so-called rich. When you add up the value of property, pension plans, 401(k) plans and other assets, a New Yorker with just over $2 million in New York “is not exactly super rich. In a state with a high cost of living, that’s not that unusual.”

DCG