Estimated $200 Million in Refunds Will Be Made Available to Maryland Residents… Will Residents of Your Home State Benefit Next?
Monday, May 18th marked the date of a landmark ruling by the U.S. Supreme Court. In a five-to-four ruling, the Supreme Court ruled (in Comptroller of the Treasury of Maryland v. Wynne et ux.) against the Maryland tax law’s double-taxation treatment of income earned by residents who work out of state. Maryland’s current tax structure is based on a two-tier system, whereby residents are assessed a state tax of up to 5.75% on their income, in addition to a county tax of up to 3.2% depending on the resident’s county of domicile. Residents who earned income from out-of-state sources, and thus paid tax to those foreign jurisdictions, were afforded a credit for taxes paid on the state portion of their income tax assessment, but not for the county portion. Thus the Supreme Court ruled that the failure to allow a credit on all taxes imposed by the state of Maryland was “inherently discriminatory and operates as a tariff”, and is thus unconstitutional under the dormant Commerce Clause, which grants the federal government regulatory authority over the states where instances of double-taxation that might discourage interstate commerce are found.
As published in
The Press of Atlantic City – posted here with permission.
See original article.
Author: Martin DeAngelis
Capaldi Reynolds & Pelosi is a mature institution, an 80-year-old accounting firm whose chairman, Bob Reynolds, has been with the business for 57 years. But the company has been on a growth spurt lately, adding 26 new partners and staff members in 24 months and doubling the size of its Northfield offices to hold all those people.
In October 2012, Capaldi Reynolds had 34 accountants and 44 total employees. By last October, after a series of mergers, the firm was up to 52 accountants and 70 employees, meaning it had grown by close to 60 percent in just two years — and in a region where the business climate has suffered badly in that same time.
Matt Reynolds, one of three managing partners, starts that growing-up-fast story in November 2012, when Capaldi Reynolds merged with Morowitz & Co., of Galloway Township, and added seven people to CRP. Read more
When it comes to constructing a portfolio it is generally not a matter of stocks or bonds, it is a matter of both. As a matter of fact, there are two other asset classes, cash and alternative investments that also should also be considered for a well-diversified portfolio. The percentage of each asset type, a.k.a. asset allocation, is the prime determinant of your portfolio’s return and volatility. Asset allocation is based upon the investor’s risk tolerance, which is a function of many factors including age, stability of income, family responsibilities, other resources, personal plans, and propensity for risk. There are also a number of objectives to consider such as the desire for capital preservation, current income, growth, risk aversion, and tax issues. A financial planner can assist you in determining your risk tolerance and developing an appropriate comprehensive plan.
Here are the final five axioms for personal finance.
The first five appear here, and can be summarized as:
- Spend less than you make
- Planning precedes every activity
- Systematically monitor your progress
- Save early and as much as possible
- Diversify, diversify, diversify
Reading or remembering them isn’t required to grasp the ones that follow.
There are many core principles that each of us regularly follow throughout our lives. These principles help us navigate through the many decisions we make daily.
I have 10 favorite axioms that I follow — and share with my college classes and clients — to make personal financial life more satisfying and effective. Sometimes, many years after the class or meeting, former students and business acquaintances reflect upon the axiom and remark how it positively influenced their lives.
Here are the first five:
Capaldi Reynolds & Pelosi, (CRP) is pleased to announce Lavinsky, Horowitz & Pollard (LH&P), CPAs and Business Advisors have agreed to join our team to form the largest locally based accounting, tax, audit and business advisory firms in South Eastern New Jersey. Jointly the new firm will have 36 CPA’s and along with our sister company CRA Financial Advisors will have over 70 employees.
Change in Tax Rates
Beginning in 2013, the American Taxpayer Relief Act of 2012 imposes new higher 39.6% and 20% tax rates on ordinary income and long-term capital gains, respectively. The new top ordinary income tax rate of 39.6% is imposed on taxable income over $400,000 for single filers, $425,000 for head-of-household filers and $450,000 for married taxpayers filing jointly ($225,000 for each married spouse filing separately). The 20% capital gain tax rate applies to capital gains and dividends for individuals above the top income tax bracket threshold.
Finding the right age and correct strategy to claim Social Security retirement benefits can have a substantial impact on a retiree’s financial security. It is essential for CPA personal financial planners to educate clients about the options and run the numbers pertaining to different claiming scenarios assuming different life expectancies. Traditionally, the Social Security Administration’s (SSA) default position has been to recommend the option that provides recipients the largest benefit today, which may be a good idea if you are in ill health and without sufficient assets. However, after considering early retirement penalties, delayed retirement credits, survivor benefits, inflation cost of living adjustments, two-income households, the tax advantage of Social Security and longer life expectancies, it may make sense for one or both spouses to delay to age 70.