Cincinnati Tax Problem Attorney Blog

Most states provide people 65 and older with a reduction on their property tax bills called a homestead exemption. Frequently, this tax reduction is also given to people with disabilities who own their own homes, veterans, and others. The reduction usually must be applied for, and the application period typically begins in January and runs through April. Some application periods run through the first Monday in June, as is the case in Ohio.

Paul A. Nidich
http://paulnidich.webs.com/

As I have written on a number of occasions, people find all kinds of ways to get into tax troubles with the Internal Revenue Service. A surprising number of people fail to file their taxes every year. A much larger number of people find they don't have the money to pay their tax bills, especially people who are self-employed. Many small business (and some not so small business) owners fail to pay withholding taxes to the IRS and risk getting into tax trouble both on a business and a personal basis.

Paul A. Nidich
http://paulnidich.webs.com/

A recent news story has reported a trend that could be costly to life insurance beneficiaries and could risk the stability of the financial system. In order to retain the assets of life insurance proceeds, some insurance companies send checkbooks to beneficiaries, instead of the insurance proceeds. These checkbooks are tied to investment accounts from which the insurance company profits, are not insured by the federal government, and could upset an already unsteady financial system.

Since these investment accounts are not insured by the federal government, something that may not be known or understood by the beneficiary, the beneficiary is at risk of losing the whole proceeds if the insurance company goes under. Further, if enough beneficiaries decide to demand all of their money at the same time, the life insurance company may not be able to meet the demand, causing the kind of "run on the bank" government insurance and regulation is intended to prevent.

Continue reading "Elder Law -- Life Insurers Give Beneficiaries Checkbooks Not Insurance Proceeds" »

On July 26, 1990, President George H. W. Bush signed what he declared to be "the first comprehensive declaration of equality for people with disabilities." He further called for the destruction of "The Shameful Wall of Exclusion."

Since that day, there have been many court decisions interpreting the Americans with Disabilities Act. Some of these decisions, and particularly some decisions of the Supreme Court, narrowed the scope of the law intended by Congress when it passed the ADA. This led to Congress passing the ADA Amendments Act of 2008 that President George W. Bush signed on September 25, 2008.

Paul A. Nidich
http://paulnidich.webs.com/

In a letter to a member of Congress, the Internal Revenue Service recently re-iterated its position that the costs related to buying, training, and maintaining a service animal may be a deductible medical expense for a taxpayer. The tests regarding the deductibility of expenses for service animals are not different from other expenses that qualify for medical expense deduction.

Paul A. Nidich
http://paulnidich.webs.com/

Section 179 of the Internal Revenue Code permits a taxpayer to elect to treat certain property that would otherwise be required to be depreciated to be treated as a deductible expense. Previously, the limits of the amount of the deduction were limited to $125,000 reduced by the amount the property cost that exceeded $500,000. These two figures were to be adjusted for inflation with the last adjustment increasing the $125,000 to $135,000 and the $500,000 to $530,000.

Paul A. Nidich
http://paulnidich.webs.com

Trusts are used by estate planners, Medicaid planners, special needs trust planners, and tax attorneys for a variety of reasons. A particular type of trust, an irrevocable grantor trust, is particularly useful in Medicaid planning.

The second element is that the trust is designed to be a grantor trust, a significant tax saving. The income of a grantor trust is taxed to the individual who created the trust, rather than being taxed as income to the trust. Income of trusts have the highest rate of taxation applied, while no individual, no matter how rich, pays a tax rate even close to the tax rate of a trust.

Continue reading "Elder Law -- Planning With An Irrevocable Grantor Trust" »