May 18, 2019

Privately Held Corporation? Consider Taking Advantage of Tax Breaks for Employee Stock Options.

Privately Held Corporations and Employee Stock Options.


The massive federal tax overhaul signed into law in December 2017, The Tax Cuts and Jobs Act, amended federal tax code to provide a savvy tax planning and tax savings benefits for certain stock options and stock units provided to employees.

Please note:  This change does not apply to publicly traded corporations, only to privately held corporations.

What changed?  Internal Revenue Code Section 83 was amended to provide that qualified employees of privately held corporations can defer paying income tax, for up to five years, on the value of qualified stock options and restricted stock units granted to them by their employers.  Pretty cool, huh?!

This change creates a significant tax savings opportunity for employees of privately-held corporations who receive qualified stock options or restricted stock grants as part of their compensation.  It is certainly something to consider when developing compensation plans for employees.  IRS Notice 2018-97 (download it here) contains technical guidance on this matter.

Tax Concerns?
About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States, including tax planning, tax preparation, and audit representation services for privately-held corporations.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 15, 2019

Trade Wars: No Winners, Only Losers, Including Businesses and Consumers.

Trade Wars:  United States vs. China.


One (of likely many things) President Trump appears to be willfully ignorant about is Tariff-Driven Trade Wars.  When the whole tit for tat tariff imposition started with China last year, Trump proudly proclaimed that 'the United States would win!'

Sorry, President Trump, but there are no winners in trade wars.  Just victims and losers.  Businesses are hurt.  People lose jobs.  The costs of goods increases, leading to both less discretionary spending by consumers and higher inflation.

Here's the latest.  On Friday,  the Trump administration increased tariffs that Mr. Trump imposed last year on $200 billion worth of Chinese imports.  Trump and his clan increased these tariffs by a jaw dropping 250%, from 10 percent to 25 percent!

That's crazy!

And did you know that this tariff is imposed on Christmas Lights?  Yep, pretty twinkly Christmas Lights.

What sicko person, what sicko government administration, imposes a 25% tariff on Christmas Tree lights?!

Scrooges!


Among the many other items in this Tariff Collection are dog collars, ski gloves, saw blades, sledge hammers, and backpacks.  Oh, and just in case you're in need of cassette tapes for your antique hand held cassette recorder, your cassettes are included in the tariff, too.

Silliness!  And just plain dumb, you don't mind me sayin'.

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 12, 2019

Trump Businesses Lost $1 Billion Over 10 Years. So What?

Trump Businesses Lost $1 Billion Over A Decade.


My thoughts on that topic?  Two words:  So what?

I subscribe to daily delivery of the New York Times, and generally find the newspaper both informative and interesting.  But I have to say the Times made a insert-foot-in-mouth fool out of itself in the May 8 newspaper.

So much that I'm awarding the much sought after ... not! ...  Bonehead of the Month award for May to the New York Times!  Here's why.

You see, it's no secret that both the New York Times and the Time's Editorial Board are no fans of President Trump.  (Frankly, I'm not much of a Trump fan myself, but that's not relevant for this post.)  On May 8, the Times posted a front page, above-the-fold article that attempted ... but failed ... to make a humongous deal of Trump's purported $1 billion of business losses over 10 years from 1985 to 1994.

One problem with the Time's storyline is that this decade included the 1990-1991 recession, during which many companies posted large losses.

But the most compelling fault with the Time's storyline is rather ironic.  In the same day's newspaper, the Business section included an article about Lyft's recent staggering $1.14 billion loss.  Time frame to post this loss?  One quarter, or a measly three months.

That's 97.5% faster!  Now there is some news perhaps worth reporting. 

I find no front page, above-the-fold worthy news about Trump businesses losing $1 billion over 10 years, when a single company, Lyft, lost a staggering $1.14 billion in a mere 3 months.   The New York Times seems to believe it is earth shattering news when a collection of businesses lose $1 billion over 10 years, yet a single company losing $1.14 billion in a mere 3 months is worthy of little more than an uneventful everyday article in the Business section.

I cannot understand the Times' rationale.  Can you ?

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 9, 2019

Insurance: When is the Last Time you Reviewed Your Insurance Policies?

Adequate Property Insurance Coverage


Yes, I know ... insurance is not the most exciting topic to discuss.

But nevertheless, it's a critical one.

The November Camp Fire in the Paradise, California area was the deadliest and most destructive wildfire in California's history.  Nearly 19,000 structures were destroyed, with an estimated damage total thus far of nearly $17 billion.  88 people perished in this inferno.  The community of Paradise, home to about 29,000 residents, was almost entirely destroyed by the blaze.

And unfortunately, many of the homeowners and property owners in Paradise had inadequate homeowners insurance, or no insurance at all.

Adequate property insurance is crucial.  This coverage is a must, even if the property owner is not required to have such insurance coverage.  Avoiding becoming underinsured ... whether it be for homeowners, business property, liability, of an other type of insurance is easy to avoid with annual reviews of your insurance coverage.  Also, your insurance coverage should be immediately reviewed and, if necessary, adjusted if you incur significant changes in your life, including home remodeling and additions.

Insurance Concerns?  About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides insurance policy reviews, coverage recommendations, and other insurance consulting services and expert witness services for clients with a broad range of insurance concerns.  She has 31 years of experience in the insurance industry, and is one of the select few Life and Disability Insurance Analysts licensed by the California Department of Insurance.  For more information about Mary and her professional services visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 6, 2019

Lexi the Dog: Home Office Time is Always Better when Spent with your Faithful Canine Companion!

Lexi the Dog.


My Loyal and Faithful Canine Companion.  My Chow-Chow Pomeranian mix Princess.

And Home Office Buddie!

Yes, every home office work day is better with a Faithful Canine Companion nearby or at your side.



Unconditional Love is as close as your nearest Animal Shelter.  Please adopt, don't shop.

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  She enjoys life in Pleasant Hill, California with her best-husband-in-the-world Jim and Faithful Canine Companions Sid and Lexi.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 4, 2019

An Early May Day in the Life of Mary Rae Fouts ...

A beautiful early May day in Pleasant Hill, California.


A beautiful start to a gorgeous day in Pleasant Hill, CA on May 4, 2019.

A sound full night's sleep the night before.  ✔

Delicious breakfast (including toasted homemade Sourdough Sandwich Loaf bread that has a few pine nuts in it) for humans, and a delicious home cooked breakfast for dogs Sid and Lexi.  Leftovers warmed up for lunch.  ✔

Long morning walk in mild, breezy temperature and sunshine galore.  ✔

Some roughhousing for dogs Sid and Lexi, followed by lounging and sleeping in the backyard in the gorgeous mild weather.  ✔

Wash laundry and hang on clothesline to dry.  Best laundry drying ever!  ✔

Household chores and some yard work and gardening, including picking fresh artichokes.  They are spectacularly delicious this year!  ✔

Continue to enjoy the day.  ✔

And once again I ask myself:  Why would anyone want to live here? ✔  😃

I hope you enjoy your weekend, too!














About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  She enjoys life in Pleasant Hill, CA with husband Jim and dogs Sid and Lexi.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

May 3, 2019

Caster Semenya: Intersex Athlete Must Decrease Testosterone Levels to Continue Competing Against Women

Caster Semenya.


Caster Semenya
The two-time Olympic gold medalist in the women's 800 meter race.

An athlete who identifies as a female, yet has male testes which continuously generate testosterone levels equal to that of a male.

In spite of this testosterone-generated muscle-building and enhanced oxygen-carrying capacity, Semenya has been allowed to compete as a woman in woman's elite track events.  I posted about this matter twice in 2016 (see my August 24, 2016 post below), and stated I did not believe it was fair to the rest of the female competitors to allow Semena to compete as a female.  I felt then as I do now, that Semena's greatly increased testosterone level gives her a competitive advantage not attainable by the other female athletes, and therefore creates an unequal playing field.

The Swiss-based Court of Arbitration for Sport recently agreed with me.  The Court ruled (2-1) that if Semenya wants to keep participating in at major track international competitions, she must do one of the following:
  1. Take hormone-suppressing drugs and reduce her testosterone levels below five nanomoles per liter for six months before competing, and maintain those lowered levels; or
  2. If she chooses to not reduce and maintain lowered testosterone levels, she must compete against men; or
  3. She can enter competitions for intersex athletes, if any are offered.

Caster Semenya Has No Female Sex Chromosomes,
Only Male Sex Chromosomes


Oh, and by the way, the Court's ruling also stated that Semenya's genetic testing showed that she has only XY Chromosomes, or Male Sex Chromosomes.  She has no ... zero ... XX Chromosomes, or Female Sex Chromosomes.  You can learn more about that finding and related technical information here.  Semenya was born with male testes and no female reproductive organs

Some people are arguing that the Court's decision is not fair to Semenya, as she identifies as a female and her high testosterone levels are naturally produced.  I don't buy that argument.  Why?  Well, if the Court's decision is truly unfair to Semenya, it is also unfair that female athletes are prohibited from taking anabolic steroids, which would allow them to compete with Caster Semenya on a level playing field.

Also, in elite sporting events, why should it matter at all if an athlete "identifies" as female or male?  If a person identifies as a fish, do we then need to create an Olympic Fish Category so the fish-identifiers are not discriminated against?  Geesh!

Lastly, if males who conveniently identify as female are allowed to compete as females in elite sporting events, the female sporting divisions will be flooded with male athletes who use this permission to game the system.  After all, winners of  Olympic and other major sporting event can earn $$$ millions in sponsorship fees and royalties.  We may never see a biological female on the podium again.

~~ Originally posted August 24, 2016 ~~

I posted about the Olympic Games yesterday, and mentioned Caster Semenya, the "intersex" female who crushed the women's 2016 Olympic 800 meter field to win the race.

Sebastian Coe, president of the International Association of Athletics Federations, has indicated the IAAF will likely challenge the ruling which stopped monitoring of female athletes who have extremely high testosterone levels. The ruling allowed Caster Semenya to discontinue taking testosterone-lowering medication, which had the direct effect of a dramatic decrease in Semenya's middle-distance race times.

Read the article in the Guardian here.

And here is the photo on the article. Pretty telling, huh?



I'm sorry, but this person should not be allowed to race as a woman.  Being sensitive to Caster Semenya's physical deformities is one thing.  But allowing her to compete as a woman is quite another thing, and is simply not fair to the rest of the competitors.  No woman would naturally have this physical appearance, nor would a woman naturally have a sky-high testosterone level.

Hopefully common sense will prevail.  But then again, as my late father-in-law said, "There is really no such thing as common sense, because sense is not common."

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

April 30, 2019

Late April Gardening in Pleasant Hill, California ... Take a Peek!

Late April Gardening in Pleasant Hill, California.


Gorgeous weather.  Check!

Cool mornings and long morning walks.  Check!

Spring and Summer Gardens thriving and soaking up Mother Nature's love.  Check!

And as you can tell, Pleasant Hill's tough clay soil grows some mighty fine artichokes!

I have not a clue as to anyone would ever want to live here.  Do you?  😎

Take a peek at  few things going on in my gardens right now ...





























About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  Mary enjoys gardening organically in her gardens at her home in Pleasant Hill, California.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

April 28, 2019

Taxes: Beware of Tax Return Mistakes if you Live in a State that Does Not Conform to Federal Tax Code.

States That Do Not Automatically Conform To Federal Tax Code.


With the major overhaul to the United States Federal Tax Code in December 2017, the changes not only created major headaches for tax planning and tax return preparation on the federal level.  These changes also created geometrically larger headaches for some corporate and individual income tax payers in states that do not automatically conform to changes in the federal tax code.

My home state of California included.

When I checked earlier this year, seven states did not yet conform to the federal tax code changes made into law in December 2017, more than a year earlier.  They were:
  • Arizona (both individual and corporate tax codes);
  • California (both individual and corporate tax codes);
  • Florida (corporate tax code);
  • Massachusetts (individual tax code);
  • Minnesota (both individual and corporate tax codes)
  • New Hampshire (corporate tax code); and
  • Virginia (both individual and corporate tax code).
This tax code non-conformity can create major headaches for tax planning and tax return preparation purposes.  If you live in one of these states, and you or your tax preparer did not pay attention to the non-conformity areas that affect your 2018 tax return(s), you could be paying considerably more state income taxes than necessary.

For instance, California continues to allow individual income tax deductions in full for state and local real and personal property taxes,  and does not conform to the $10,000 limitation placed by federal law, you can deduct your full tax amount.  California also continues to allow mortgage interest deductions of up to $1.1 million, $1 million for acquisition mortgage debt and $100,000 for home equity debt. Federal law (for loans taken out as of December 15, 2017, older loans are grandfather in) allows only $750,000 for acquisition mortgage debt and nothing for home equity debt.

And that's merely the beginning of non-conformity tax concerns.  Have a headache yet?

Make certain your tax returns are properly prepared, so you do not pay more tax … perhaps much more tax … than you are legally required to pay.

Tax Concerns?
About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

April 26, 2019

Looking for Something Fun to do this Weekend? Take a Peek at the National Cornbread Cook-Off!

The National Cornbread Cook-Off


Cornbread Baked in a Cast Iron Skillet
Photo Credit:  Unknown
I know, cornbread can be a love it or hate it quick bread.  Regardless of your stance with this centuries old food, something fun is going on this weekend.

And that fun event is the National Cornbread Cook-Off, taking place in South Pittsburgh, TN this Saturday and Sunday, April 27 and 28.  In addition to having an adult competition, the event also has a 4-H Cornbread Cook-Off Competition, open to all 4th grade 4-H youths.  Now that is really cool!  What a great idea to get girls and boys interested in cooking and baking.

Lodge Cast Iron (one of my favorite cookware/bakeware companies!) is a sponsor of the event, and will live stream parts of the competition on their Facebook page.

For more information, as well as absolutely scrumptious-sounding cornbread recipes, check out the National Cornbread Cook-Off website.

Happy cooking and baking, everyone!

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  She loves to cook and bake, and frequently uses cast iron cookware.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

April 25, 2019

Healthier Eating and Living: If You Eat Dark Leafy Greens, Particularly Spinach And Kale, Choose Organic!

Dark Leafy Greens and Pesticide Residue.


There's no debating that dark leafy greens such as spinach, kale, chard, broccoli, and cabbage are very healthy.  But another not-so-healthy matter contaminates some of these healthy dark greens:  pesticide residue.  Particular in kale and spinach.  And in some samples, lots of it.

Each year, the non profit Environmental Working Group compiles a list of the top 12 most pesticide contaminated vegetables and fruits, based on laboratory testing of by the US Department of Agriculture and the Food and Drug Administration.  The 2019 list is based on results from 40,900 produce samples.

For 2019, conventionally-grown spinach earned the dismal ranking of #2, or produce with the 2nd highest concentration of pesticide residue.  And kale?  Well, when conventionally grown, this much touted leafy green earned the dismal ranking of #3, or the produce with the 3rd highest concentration of pesticide residue.

Spinach

Spinach and Pesticide Residue


In the samples of conventionally-grown spinach, every ... EVERY ... sample tested had an average of 7.1 pesticides, with some samples containing as many as 19 different pesticides!  In spite of the fact that the pesticide DDT has long been banned in the United States, residues of DDT were found in an amazing 40% of the spinach samples.

Kale

Kale and Pesticide Residue


In the samples of conventionally-grown kale, an astounding 92% had 2 or more pesticide residues, with some sample containing as many as 18 different pesticides!  And get this - almost 60% of kale samples tested positive for the pesticide DCPA (Dacthal), which the EPA has long classified as a possible carcinogen.  It's been banned in Europe since 2009.

How to Avoid Pesticides?  Buy Organic.


The only way to truly avoid pesticides and other synthetic chemicals in your produce is to buy organic.  These products are not allowed in organic-certified farming, but they are allowed in conventional farming.  Knowing what produce is most often contaminated with pesticides can help you make smarter - and healthier - choices in the produce aisle.


About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  She enjoys year-round organic gardening at her home in Pleasant Hill, California.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts

April 22, 2019

Lexi the Dog: Did You Dig This Big Hole?

Lexi the Dog.


My beloved Chow Chow-Pomeranian mix Princess and Faithful Canine Companion.

Here she is last month watching over a freshly-dug hole in the backyard.  Was she guilty of this dastardly digging?  Nope, it was Sid!  But still cute to watch Lexi seemingly watching over the hole, and taking her hole guarding rather seriously.


And here is Sid, the guilty party, examining his digging work.  Busted!



Every day is an adventure with my Faithful Canine Companions!

About Mary Rae Fouts, EA

Mary Rae Fouts, EA provides tax, insurance consulting, and expert witness services to clients throughout the United States.  She enjoys life with her Faithful Canine Companions Sid and Lexi, and best-husband-in-the-world Jim.  For more information visit FoutsFinancialGroup.com.

Mary Rae Fouts