HDTenEightyP/NetNews huggingface dataset:
From: rdyreng@logdis1.oo.aflc.af.mil (Russell I. Dyreng;OO-ALC/LILEE)
Newsgroups: misc.taxes
Subject: Re: Is paying income tax voluntary?
Date: Thu, 30 Jul 92 14:01:43 -0700
Organization: Fedtax-L<==>Misc.Taxes Gateway
X-Gateway-Source-Info: Mailing List

In your message of 30 Jul 1992 at 1053 MDT, you write:
> In article <1992Jul30.133158.20831@uc.msc.edu> eab@uh.msc.edu (Edward Bertsch) writes:
> >could someone post a list of the states that have no state income tax?
>
> Bear in mind that some states without state income tax make it up in sales tax.
> Actually, sales tax in CA used to be a lot less now that I think about it.
> --
>
> -- Alan                        # Mountain Dew and doughnuts...
>    ..!ames!elroy!alan          # because breakfast is the most important meal
>    alan@elroy.jpl.nasa.gov     # of the day.
>
The State of Washington levies no personal income taxes against its
citizens.  They do however have a pretty hefty sales tax.  Furthermore
the State of Oregon levies no sales taxes.  Several people I know have
theorized that one could live and work in or around the city of
Vancover, WA, thereby avoiding state income taxes and then cross the
Columbia River to shop in and around Portland, OR without paying any
sales taxes.

Any Washingtonions/Oregonians/Vancouver(WA)ites/Portland(OR)ers out
there who can either verify or shoot holes in this theory?

Russ
From: dfavor@logan.tivoli.com (David Favor)
Newsgroups: misc.taxes
Subject: Re: Second home that's up for sale
Keywords: any tax breaks
Date: 23 Jul 92 14:57:23 GMT
Distribution: misc

In article <1992Jul16.192219.26435@rti.rti.org>, iba@rti.rti.org writes:
|> I have recently had a new house built.  I had put my townhouse on the
|> market prior to the contract of the new house, and have watched the
|> new house rise and now I'm closed and moved into it.  Problem is, I
|> still haven't sold the townhouse.  I have satisfied the loan on the
|> townhouse so there is no mortgage payments to be made on it, however,
|> I still have to pay the taxes, insurance, water/electric bills and
|> association dues until it sells.  Water and electric just for the
|> simple fact that it's still on the market.
|> 
|> Is there any kind of tax break or depreciation that I can claim other
|> than the real estate taxes?  I'm not renting the townhouse and would
|> dearly love to avoid doing so.  I just want to sell...as it is now,
|> it's costing me over 300/mo till it does sell.
|> 
|> Any help would be appreciated.  I can't afford to carry both places
|> for too long.  But knowing there's some kind of tax relief might help me
|> get by.
|> 
|> Thanks
|> 
|> Ingrid

you might consider...

leasing it with an option to purchase. charge fair market rental then
on top of that $100-$500/month option money. usually this money is
earmarked to reduce the purchase price at the end of the option period.
a word of caution though. )you may not treat a property as a rental
property if you have lived in it more than 14 days out of the year...
at least this is my interpretation of the IRC. so your first year you
may lose the depreciation benefit.) the last figures I heard indicated
less than 20% of options are exercised. so... you just keep leasing the
property over and over again. since the 'tenants' are building equity
via option payments this type of agreement tends to change peoples
mindset from renters (who destroy) to home owners (who improve).

you might also consider...

sell the property $0 down for a high price and high interest rate. the
buyer benefits tax-wise and is able to purchase a home. you benefit from
the steady stream of income. make sure you put an accelleration clause
in the loan and early payoff penalties. you may even want a clause allowing
you to match any written contract to buy, so as to keep control of the
property... this is a form of home equity loan. the only difference is
that people pay you interest instead of you paying a lender interest.
Newsgroups: misc.taxes
From: richter@mcc.com (Charlie Richter)
Subject: Re: Read my lips!
Organization: MCC, Austin, TX
Date: Tue, 21 Jul 1992 21:12:11 GMT

> If you have lived long enough, the last time the Democrates controlled
> both branches, 1976-1980, U.S. achieved the economic impossible, trible
> digits in INFLATION, INTEREST RATES, and UNEMPLOYMENT.

And if you've lived long enough, you recall that when Carter left the
White House after 1980, the United States was the largest creditor
in the world.  (We are now the largest debtor.)  And if you've lived
long enough, you know that neither Reagan nor Bush ever submitted a
balanced budget to Congress.  And if you've lived long enough, you
know that during his first term, Reagan enjoyed a majority in the
Senate and (with the Boll Weevils) an effective majority in the House,
and the deficit ballooned.

So what's your point, and what does it have to do with misc.taxes?
-- 
Charlie Richter   MCC   Austin, Texas
  uucp: richter@milano.uucp     arpa: richter@mcc.com
"The panic ... was not due to anything fundamentally weak in either business
   or finance.  It was confined to the market itself."   - WSJ, Oct. 31, 1929
From: dfavor@logan.tivoli.com (David Favor)
Newsgroups: misc.taxes
Subject: Re: Down Payment using 401(k) money.
Date: 23 Jul 92 15:00:41 GMT

In article <BrI1Fx.GM2@news.cso.uiuc.edu>, acheng@ncsa.uiuc.edu (Albert Cheng) writes:
|> 
|> In article <l63upkINNkcr@exodus.Eng.Sun.COM>, kunda@hanuman.Eng.Sun.COM (Ramachandra P. Kunda) writes:
|> >According to Charles Givens book "More Wealth Without Risk",
|> >it is possible to take money out of 401(k) and use it for
|> >down payment for a house without paying taxes and penalties.
|> >
|> >Is this true?  Has anybody done this?  Does anyone know who
|> >has done it?
|> >
|> >I talked to Sun benefits dept. representative and she told
|> >me that it is not true.
|> >
|> >Who is correct?
|> 
|> Depends on your investment policy on 401(k).  I have a 403(b) (similar
|> to 401k except it is for non-profit organizations like universities)
|> which can invest in annuity by TIAA or Mutual Funds by Fildality.
|> The TIAA policy permits loan like you said, but the Mutual Funds one
|> does not. 

this is true. more up to date Givens materials describe different types
of 401K policy. most 401K plans do not allow this because few employers
want to become partime lenders.
From: Ligon@macgw1.ge.com (Woody Ligon)
Newsgroups: misc.taxes
Subject: Capital gains from primary residence
Date: 22 Jul 92 17:57:37 GMT
Distribution: usa
Organization: GE-CRD

We all know that when we sell our "primary residence" we can avoid taxes
on any capital gains which might arise from that sale if we re-invest in
another primary residence within a certain grace period. 

Suppose, however, that our re-investment consists of putting the money from
the sale of the primary residence into improvements on a delapidated old 
farmhouse  which we just acquired by inheritance and this improved home now
 becomes the primary residence.  Does this scenario satisfy the requirement
 to "re-invest" in a second primary residence provided all the improvements 
are completed within the "grace period"?  

Clearly if we used  the money from the first sale to _buy_ and fix-up
an old farmhouse, that would satisfy the requirement, but are things 
different just because the old house is inherited rather than bought?

Thanks in advance.

Woody Ligon
(ligon@macgw1.ge.com) 
Newsgroups: misc.taxes,misc.legal,alt.individualism
From: underdog@leland.Stanford.EDU (Dwight Joe)
Subject: Re: Is paying income tax voluntary?
Organization: Miners for a Heart of Gold
Distribution: na
Date: Thu, 30 Jul 92 04:35:04 GMT

In article <1992Jul29.233933.17592@cco.caltech.edu> kkyoshim@cco.caltech.edu (Kenneth Yoshimoto) writes:
>
>
>Sorry if this has been asked previously.  I've been told that paying income
>tax is voluntary.  It also says this in the welcome message in the 1040
>booklets.  My question is:  is it true that there are two types of citizens,
>federal and state, and that those people who are state, but not federal,
>citizens are free from a number of legal obligations, among these, the
>obligation to pay income tax?  If so, what are some sources I could 
>use to find out more?

Oh boy.  We've got a live one.

Paying income taxes is _NOT_ voluntary.  Regardless of whether you
are a citizen, resident alien, or non-resident alien, everybody pays
taxes to the national gov't.

On the other hand, depending on the state in which you are residing, 
you may or may not have to pay additional income taxes to the _state_. 
For example, Texans don't pay _state_ income taxes, but Californians do.

Hmmm.....
Maybe, that's why companyies are relocating from Silicon Valley
to Austin, but that's another thread...

-------------------------------------------------------------------------------
Seikatsu no imi wa nan desu ka.            \|  |`      | Don't buy from Toyota;
Shitte itara oshiete kuremasen ka.          | -+-      | especially, don't buy
                                           /| / \      | from Capitol Toyota in
Copyright 1992.                                        | San Jose, California.
-------------------------------------------------------------------------------
Newsgroups: misc.taxes
From: shoaf@helix.nih.gov (Susan E. Shoaf)
Subject: Re: Students and Taxes
Organization: (National Institutes of Health, Bethesda, MD)
Distribution: usa
Date: Tue, 21 Jul 1992 16:53:30 GMT

In article <1992Jul17.003409.18903@mont.cs.missouri.edu> newberg%kazoo.Berkeley.EDU@ucbvax.Berkeley.EDU (Lee Aaron Newberg) writes:
>jrh@ldgo.columbia.edu (john hopper) writes:
>| Rep. Tom Lewis (R) from Florida has introduced the 
>| following resolution (HR 4418) which:
>| 
>| "amends the tax reform act of 1986 to repeal the provision
>| taxing scholarships and fellowships and 
>| to exclude them from gross income, beginning with the 1987
>| tax year. "
>| 
>| It is currently being considered by the Ways and Means
>| Committee which must pass it before it goes to the full house.
>| No-one has yet introduced a companion bill in the Senate.
>
>This bill is only for people who think that all students, rich and
>poor, deserve to be taxed less simply because they are students.
>
>representatives to pass some real tax relief for the poor instead of
>this pork.
>
I just had to respond.  I was in graduate school when the "REFORM"
bill was passed.  From a tax-free stipend of 6000, I began to recieve
7200$ of taxable stipend.  So now the U.S. government had to pay an
increased stipend, taxes now had to be withheld for all students meaning
that the personnel offices were inundated with questions on W-4 forms, 
and they now had to keep track of all the taxes withheld, etc.  The 
universities suddenly had thousands of NEW employees!  State taxes were
also withheld.  In NY,the amount of tax due on a stipend of 7200$ was less
than 100$, some benefit to the state for the amount of work their state
employees had to now spend tracking down these new employees.

Consider that every federally funded grant application that requested funding
for a graduate student now had to be increased to account for the tax.  For a
20000$ grant, it is now 21,000 a 5 % increase.  Did the NIH extramural grant
money go up 5% to account for the reform. NO NO NO.  So less grants were 
funded or less graduate students were able to get an education because
the funding pool did not proportionately increase.  

When this bill was passed the NIH stipend for post-doctoral fellows now
became taxed- their stipend did not increase.

If you got this far, thanks for listening.

Susan

Newsgroups: misc.taxes,misc.legal,alt.individualism
From: kkyoshim@cco.caltech.edu (Kenneth Yoshimoto)
Subject: Is paying income tax voluntary?
Organization: California Institute of Technology, Pasadena
Distribution: usa
Date: Wed, 29 Jul 1992 23:39:33 GMT



Sorry if this has been asked previously.  I've been told that paying income
tax is voluntary.  It also says this in the welcome message in the 1040
booklets.  My question is:  is it true that there are two types of citizens,
federal and state, and that those people who are state, but not federal,
citizens are free from a number of legal obligations, among these, the
obligation to pay income tax?  If so, what are some sources I could 
use to find out more?

Thanks,
Kenneth Yoshimoto
From: "hilary miller" <hilary.miller@execnet.com>
Newsgroups: misc.taxes
Subject: are futures traders s
Date: 25 Jul 92 10:17:30 EST
Reply-To: "hilary miller" <hilary.miller@execnet.com>
Distribution: misc
Organization: Executive Networks Information


Don Barstow, in a message to All on 07-24-92 at 7:43pm, said:

DB>|Are people who trade futures for their own accounts as a full time livi
   |classified as "self-employed?"  Do they get all the advantages (KEOGH) 
   |disadvantages (self-employment FICA) of that status?  Or is it all clas
   |as un-earned income, and just shown on form 6781 - Part 1, and carried 
   |to Schedule D, just like the rest of us?
   |_______________________________________________________________________

               Whether you are engaged in the "trade or business"
               of futures trading is a question of fact.  If you
               are so engaged, then you report the income on
               Schedule C and take the benefits (and detriments)
               associated with being self-employed.


   L A
 I    R        Hilary B. Miller of Greenwich, Connecticut
  H/\Y         CIS: 76040,1743
    
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Newsgroups: misc.taxes
Subject: Re: FICA payments...NOT
From: gary@cdthq.UUCP (Gary Heston)
Date: Sat, 25 Jul 92 19:52:10 CDT
Organization: Garys' Home for Obsolete Computers

youngs@osiris.cso.uiuc.edu (D.Youngs) writes:

> I have been paying into a state retirement account for several years.
> Recently I moved out of state and am being forced to make FICA payments.
> Does anyone know how I can avoid these payments?  Otherwise, I must wait 3
> months to qualify for a 401K plan from my employer to kick in.

You can avoid them by not working. Further, when you can start on the
401K, the FICA does *not* go away; you still pay it.

Welcome to the private sector.

Gary Heston, at home....
gary@cdthq.uucp
Newsgroups: misc.taxes
From: burgoyne@highlite.uucp (J. Robert Burgoyne)
Subject: Re: FICA payments...NOT; How to avoid Tax: No Socialist US!
Organization: Gotham Communications Research
Date: Mon, 27 Jul 1992 15:16:06 GMT

You can avoid paying FICA by earning your money outside the US. You go
on an overseas trip to a foreign company, spend a few weeks doing some
work, and you pay yourself salary for the time you were there.

Also, if you are your own corporation, you can pay yourself dividends
and a small salary. The salary must be "reasonable", but the dividends
are taxed as capital gains. For some people, the tax paid on capital
gains can be less than the total FICA cost (15.3%) plus income tax.

After much thought and discussion with tax attorneys, the best way to
avoid all taxes is to be your own corporation. Although some states
have corporate personal property taxes, others don't. And if you 
transfer profits to a corporate holding company (outside your tax
unfriendly state in a place like Delaware) you can avoid state taxes.

If you want to be really tricky, you can find a partner in a country
with poor tax compliance. Hong Kong, Taiwan, & Thailand are current 
favorites. Your US corporation pays money to the overseas company to
consult with a local expert who will try to make money for you. Alas,
he is unable to. But when you go to visit him, his company willingly
makes cash gifts to you and your spouse. Or he can wire transfer
money into your personal bank account. All as a gift. 

Your partner takes out enough money to pay his country's very small
taxes (typically < 15%), keeps a little, and gives you the rest. It
may sound illegal but it's being done thousands of times over every
waking day. I view it as a reflection of the stupidity of our
legislators (mostly democrats but I should throw Dick Darwin into
the fire too.) who think they can match the brains of people hell bent
on avoiding paying taxes no matter what they have to do.

Schemes like this one are why Jerry Brown's flat tax really makes sense.

But there's just too much vested interest in keeping our present,
ridiculous, tax code.

Most of your travel can be written off as business expenses as long as you
actually do some business on the trip.

It's a shame that here in this quasi-socialist U.S. a tax attorney
is guaranteed to make more money than people who make a more positive
contribution to the economy. That's how the democrats want it.

Robert
From: dhb@ksr.com (Don Barstow)
Newsgroups: misc.taxes
Subject: Are futures traders self-employed?
Date: 21 Jul 92 19:08:56 EDT
Organization: Kendall Square Research


Are people who trade futures for their own accounts as a full time living
classified as "self-employed?"  Do they get all the advantages (KEOGH) and
disadvantages (self-employment FICA) of that status?  Or is it all classed
as un-earned income, and just shown on form 6781 - Part 1, and carried over
to Schedule D, just like the rest of us?

Don Barstow
dhb@ksr.com
From: rabson@oxford.ac.uk (David Rabson)
Newsgroups: misc.taxes
Subject: when is a fellowship earned income?  (US tax law)
Date: 31 Jul 92 17:56:06 GMT
Organization: Oxford University Computing Service, 13 Banbury Rd, Oxford, UK
Originator: rabson@black

I need rather technical advice on when a postdoctoral research fellowship
can be considered earned income.  I already have publication 520, the
instructions for form 2555, and an incomplete excerpt the I.R.S. photocopied
for me from proposed regulation 1.117-6, P7182, page 20115 of "Standard
Federal Tax Reports."

I am hoping that my fellowship can be considered earned income, since then
it will be excludable on form 2555.  If it is unearned income, I can't
file a 1040X to recover the taxes I've already paid on it.

The fellowship is paid by International Organization "A" through a
U.S. agency, "B".  I am not, however, considered an employee of either
"A" or "B" but rather of my university, "U," in the United Kingdom.

According to the I.R.S., a 1963 ruling established that my fellowship,
as then constituted, was a scholarship and so exempt from U.S. tax.
Since 1986, however, that part of a scholarship not used for tuition
or expenses (and with other qualifications) is taxable as gross income.

Unfortunately, the I.R.S. tells me that a scholarship or fellowship
for research is not earned income and therefore not excludable on form
2555.  (The facts that "B" is a U.S. agency and that I am paid in dollars
are entirely irrelevant to the foreign earned income exclusion).

Therefore, since it wasn't taxable, it is now.  If it had been taxable
then, it wouldn't be now.

Does anyone else have experience with this?  Is there some way I can
convince the I.R.S. that this is earned income?  It's not as though I'm
on vacation here :-)

David Rabson
From: "hilary miller" <hilary.miller@execnet.com>
Newsgroups: misc.taxes
Subject: bad debt? lost invest
Date: 29 Jul 92 07:18:46 EST
Reply-To: "hilary miller" <hilary.miller@execnet.com>
Distribution: misc
Organization: Executive Networks Information


Jeff Sullivan, in a message to All on 07-28-92 at 4:48pm, said:

JSIs there any way to reclaim money lost as membership dues to a company
   that goes bankrupt or out of business?
   

          You can treat it as a non-business bad debt and take a short-
          term capital loss for it.


   L A
 I    R        Hilary B. Miller of Greenwich, Connecticut
  H/\Y         CIS: 76040,1743
    
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Newsgroups: misc.taxes
Subject: Re: Capital gains from primary residence
From: gary@cdthq.UUCP (Gary Heston)
Date: Sat, 25 Jul 92 19:49:46 CDT
Organization: Garys' Home for Obsolete Computers

smorrow@hpmwtd.sr.hp.com (Steve Morrow) writes:

> Along the same line, if I sell a house for $200,000 and I pay off a
> $50,000 mortgage, leaving me with $150,000 which I then use to buy
> a $150,000 house outright, I owe NO capital gains tax because I
> reinvested all my profit...right?  A friend told me his accountant
> told him he owed on the $50,000 he "made" on his first house, but
> he owed $50,000 mortgage, so how can you pay on something you didn't
> make?  In other words, he thinks that because he didn't buy another
> $200,000 house, he owes capital gains, but I say he only made
> $150K and should be able to buy a $150K house and have no penalty.

The rules specify that you have to buy a house of equal or greater
value to qualify for the deferral. He's right, you're wrong. Call the
IRS and order the paperwork if you wish to verify this.

Gary Heston, at home....
gary@cdthq.uucp
Newsgroups: misc.taxes
From: sam2y@uvacs.cs.Virginia.EDU (Steven A. Moyer)
Subject: Def. of Investment for Tax Purposes
Originator: sam2y@koa.cs.Virginia.EDU
Organization: University of Virginia Computer Science Department
Distribution: usa
Date: Wed, 22 Jul 1992 16:36:42 GMT


Can anyone point me to where I can find the legal definition of
"investment" for tax purposes?

I know that you can subtract capital loss on an investment (up to
an upper limit) from capital gains.  Of course this begs the
question of what can constitute an investment.

I know that stock market losses are covered here, but what about other
speculative purchases.  In particular, I want to know if investment in
antique cars falls under this rule.

Any pointer to the correct literature would be most helpful.


Thanks,

Steve




-- 
+--------------------------------------------------------------------+
| Steve Moyer                    |       THIS SPACE FOR RENT         |
| Computer Science Department    |                                   |
| University of Virginia         |                                   |
From: "hilary miller" <hilary.miller@execnet.com>
Newsgroups: misc.taxes
Subject: def. of investment fo
Date: 29 Jul 92 07:18:46 EST
Reply-To: "hilary miller" <hilary.miller@execnet.com>
Distribution: misc
Organization: Executive Networks Information


Barry Margolin, in a message to All on 07-28-92 at 4:48pm, said:

BM>|Does personal property fall into this?  For instance, if one kept good
   |enough purchase records, could they claim capital losses when they sell
   |their furniture, home entertainment equipment, appliances at a garage s
   |If they were a business they would presumably have to depreciate things
   |like this, but do individuals?
   |_______________________________________________________________________

               Personal property is included under the definition
               of capital asset.  However, although you must re-
               port the gain on the disposition of such property
               as a capital gain, you are denied any benefit of a
               loss on such property unless it was held for the
               production of income.


   L A
 I    R        Hilary B. Miller of Greenwich, Connecticut
  H/\Y         CIS: 76040,1743
    
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Newsgroups: misc.taxes