From: owner-persfin-digest@lists.xmission.com (persfin-digest) To: persfin-digest@lists.xmission.com Subject: persfin-digest V5 #108 Reply-To: persfin Sender: owner-persfin-digest@lists.xmission.com Errors-To: owner-persfin-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes persfin-digest Sunday, November 28 1999 Volume 05 : Number 108 In this issue of the Personal Finance Digest: Re: Taxation Implications of Donated Items, Re: Retiring on the lottery re: Taxation Implications of Donated Items Re: Retiring on the lottery Money flow statistics on stocks Re: No More Estate Taxes? Charitable contributions Re: No More Estate Taxes? Re: Theresa Overreacting Re: Theresa The messages posted to the Persfin-Digest are opinions and are not intended to substitute for qualified professional advice. Subscribers should seek the services of qualified professionals for such advice. The publisher, Internet provider, and Digest contributors cannot be held responsible for any loss incurred as a result of the application of any of the information provided here. To ask questions or provide answers, send your email to "persfin-digest@lists.xmission.com". Also, you can "reply" to the persfin-digest and your email tool should fill in the same address. However, if you "reply", be sure to edit the subject field in your email to reflect your topic. Copyright (c) 1999, Jeff Salisbury POSTED SUBSCRIPTION FEE: $20/year. Payment is optional. You will not be billed. The Digest is available to all subscribers, whether or not they pay. I do not discriminate either in favor of paying subscribers or against nonpaying subscribers. If you feel that the information presented here is worth the fee, and you feel comfortable paying it, send cash, check, or money order (U.S. funds), payable to "Jeff Salisbury", to: Jeff Salisbury 65 North 1300 East Logan, Utah 84321 Payment will be acknowledged by e-mail if you include an e-mail address. Subscribe: e-mail majordomo@xmission.com, text: subscribe persfin-digest Unsubscribe: e-mail majordomo@xmission.com, text: unsubscribe persfin-digest ---------------------------------------------------------------------- Date: 23 Nov 1999 12:15:14 EST From: Jacqueline.D.Richardson@Hitchcock.ORG (Jacqueline D. Richardson) Subject: Re: Taxation Implications of Donated Items, - --- Alfred Anderson wrote: Question, how should this reduction in 1999 taxes be treated? - Should the reduction be applied as "rent" on the property and = thus taxed? - Should I consider the abandoned property as a "gift" in which = case no taxes would be owed? - Should I just take the deduction with no offsetting income? - --- end of quote --- This probably varies by state, but in New Hampshire after 28 days = the left-behind property becomes the property of the landlord and = the landlord can dispose of it in any way they see fit. Therefore, = since it becomes your property and you donate it to charity I would = think you could write it off as a donation. I'm just a landlord, not an accountant or attorney. Jackie in VT/NH - - ------------------------------ Date: Tue, 23 Nov 1999 10:52:50 -0700 From: Jeff Salisbury Subject: Re: Retiring on the lottery > Nancy Slator wrote: > > Stephen Brobeck, the consumer group's executive director, said > > banks and brokerage > > firms must take some of the blame for the fact that many Americans > > don't realize there are > > ways to invest profitably even small amounts of money, such as in > > savings bonds or mutual > > funds. > > Are there really ways for a 20 year old with $50 to get 9 percent > interest? Nancy, Absolutely there are ways for a 20 year old with $50 to get a 9% return! Maybe not guaranteed 9% interest... However, historically investments in equities have returned between 10-11% annually. Also, there are scads of mutual funds out there that will accept $50 per month - -- particularly in an IRA. As an example, if a 20 year old invests $50 / month until they are age 65 and they average 11% return each year, they will have $248,673. If, as they get older and earn more, they increase their savings rate (even a little bit each year), they will do much, much better. There are two keys to winning this game: 1. Start saving and investing something now. Even if it seems too piddily to bother. It's the habit of saving that is important. 2. Increase your savings rate whenever you can until you are saving at least 10% of your income. Ususally this is the easiest to do when you get a salary increase associated with an annual raise, a promotion, or a change of jobs. Set a goal to increase your saving rate 1-5% each year until you've reached 10%. It is the habit of increasing your saving rate that is important. I'm not speaking some theoretical thing here. Rather, I speak from the personal experience of starting my savings in my 20's (I'm 36 now) and doing items #1 and #2. I still remember tracking down a mutual fund that would accept my meager $50/month. I felt a little intimidated at the time, but now over a decade later I'm amazed at the results... Regards, Jeff - - ------------------------------ Date: Tue, 23 Nov 1999 16:46:20 -0700 From: Rick.Schafer@bdk.com Subject: re: Taxation Implications of Donated Items "Anderson, Alfred, " wrote... Here is an interesting scenario, I have a rental house. The tenant abandoned the property leaving many personal articles behind. These articles would be difficult to sell (clothing, etc), so I elect to donate them to charity. I value the donation Dear Alfred, You need to be careful. In our neck of the woods -- Massachusetts -- when a tenant abandons a rental unit and leaves property behind, the landlord is required to put the property in storage for 6 months at his own expense. If you do not do this, the poor abused tenant can sue you. At the end of that time if the tenant has not claimed it, you can sell it to pay the expenses. Otherwise, I like your idea. Rick Schafer - - ------------------------------ Date: Tue, 23 Nov 1999 23:40:53 -0500 (EST) From: "L. Chen" Subject: Re: Retiring on the lottery > ............... > Are there really ways for a 20 year old with $50 to get 9 percent > interest? > ................... > I have a state retirement plan. I'm not going to have half a million > dollars when I retire, but I will have a pension. It's probably > statistically true that my best bet for having a half a million dollars in > the bank is the lottery -- and I don't even buy tickets. > > - -- Nancy Slator, neslator@amherst.edu Are you talking about $50/month or $50/week? 9% is the total return on equity investments, not interest on deposits. $50/month for 45 years @ 9% will give you $370,244 by the time you are 65. And I suspect you will be able to afford more than $50/month as your income grow over the years. So, $500K is not that difficult -- if you start early and keep at it. Aslo, don't forget to count your money in your 401 or IRA. That IS YOUR retirement money. It is the POWER OF COMPOUNDING. And compounding requires TIME IN THE MARKE (not timing the market) for it to work. [I borrowed the above expression from a broker's presentation.] TIAA-CREF recently started to offer some funds to the public with relative low expense ratio; and only $250 to open an account. TIAA and other fund companies will waive the minimum if you agree to an automatic investment arrangement. i.e. you agree to put it $25-50/month until the minimum is reached. Many people never start because they don't think they can reach an amount they have in mind. But you will never get there if you never start or keep procastinating. - - ------------------------------ Date: Tue, 23 Nov 1999 23:42:50 -0500 (EST) From: "L. Chen" Subject: Money flow statistics on stocks Are there any low cost providers for the subject data? TIA Chen - - ------------------------------ Date: Wed, 24 Nov 1999 18:50:41 -0500 (EST) From: Nancy Slator Subject: Re: No More Estate Taxes? > From: Jeff Salisbury > > The bottom line is this--if you have an estate over $650,000, then you > need to be concerned about estate taxes. I think estate taxes are the fairest tax of all. They don't take any money away from people who earned it and they don't take money away from people who need it. If my parents had a net worth over $650,000, I would have gone to boarding school and an Ivy League college, and then I could have been given the seed money to start my own business. I wouldn't be saddled with college loans and I'd probably be well on my way to having my house paid for. And I would have all these benefits without having lifted a finger -- just by the good luck of having been born into affluence. After I take all that to the bank, if the government gets between me and the fortune my parents worked hard for, I don't have much to complain about. - -- Nancy Slator, neslator@amherst.edu - - ------------------------------ Date: Wed, 24 Nov 1999 20:14:41 -0500 From: "Gregory J. Bunger" <73174.377@compuserve.com> Subject: Charitable contributions Re: How to handle gifting of abandoned items. Technically, you can only claim the lesser of the fair market value or yo= ur basis when gifting something to charity. So if the items were abandoned,= you have no basis (or cost) so you can't write any of the gift off as a charitable deduction. If you counted their value as rent received, included it on your shcedule= E, then you could deduct the amount you claimed as income, as long as it was less than the fair market value. In reality, the IRS is not going to question how you obtained the abandon= ed items and would only question the value you put down as a charitable deduction. (Unless you are giving away an unusually large amount of items= ). Hope this helps. Greg Bunger 73174.377@compuserve.com - - ------------------------------ Date: Thu, 25 Nov 1999 06:52:08 -0700 From: Jeff Salisbury Subject: Re: No More Estate Taxes? Nancy Slator wrote: > > > From: Jeff Salisbury > > > > The bottom line is this--if you have an estate over $650,000, then you > > need to be concerned about estate taxes. > > I think estate taxes are the fairest tax of all. They don't take any > money away from people who earned it and they don't take money away from > people who need it. If my parents had a net worth over $650,000, I would > have gone to boarding school and an Ivy League college, and then I could > have been given the seed money to start my own business. I wouldn't be > saddled with college loans and I'd probably be well on my way to having my > house paid for. And I would have all these benefits without having lifted > a finger -- just by the good luck of having been born into affluence. > > After I take all that to the bank, if the government gets between me and > the fortune my parents worked hard for, I don't have much to complain > about. > > -- Nancy Slator, neslator@amherst.edu I have heard some people advocate doing away with all taxes except for a 100% estate tax. Personally I do not. However, consider these reasons for eliminating the current estate tax: 1. Estate and gift tax revenues raise less than 1% of each year's total federal tax revenues. 2. Estate and gift taxes are an obstacle to the continuity of family businesses and farms. These taxes force the sale of the business or farm upon the death of the first generation just so the 2nd generation can pay the estate tax. 3. Almost 90% of the estate tax returns are filed by estates of $2.5 million or less. 4. About 65 cents of each dollar of estate and gift tax collected is used for compliance and enforcement activities. Of these points, I find #2 and #4 to be the most compelling. Regards, Jeff - - ------------------------------ Date: Thu, 25 Nov 1999 15:03:17 GMT From: jmetz@slonet.org (JMetz) Subject: Re: Theresa Overreacting Theresa and the Case of the Falling Child: I really think that Theresa overreacted to a common occurance at daycare. In my opinion, I believe the providers, the State, and the doctor acted appropriately. Is the child okay? If so, then what's the big deal? Getting cuts, falling, bruising, banging, hitting, etc. is typical behavioral occurances for 22 months old. I really hate to be so blunt, but Theresa's email really took the frosting off the cake for me. - - ------------------------------ Date: Thu, 25 Nov 1999 16:50:42 GMT From: jmetz@slonet.org (JMetz) Subject: Re: Theresa Sorry for the previous post about Theresa. I hit the wrong button. Please forgive. Thanks. Entrepreneur, vivant, plumber, musician, chef, carpenter, electrician, gardener, psychologist, historian,teacher, provider, mechanic, nurse,chauffer,repairman, friend, enabler, masseur, babysitter, chemist, dishwasher, ameliorator, husband, father -just a few things I do. jmetz@slonet.org - - ------------------------------ End of persfin-digest V5 #108 ***************************** - To unsubscribe to persfin-digest, send an email to "majordomo@xmission.com" with "unsubscribe persfin-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.