Apple, Inc. – Tremendous American Company…. and Tax Dodger?

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Apple Inc. CEO Tim Cook appeared before a bi-partisan panel of congress to talk about the tax planning strategies of Apple, one of the greatest companies of our time, or any time for that matter.  Apple employs thousands of people and has changed the life of millions of folks worldwide with its wide variety of products used for both personal and business.

But Apple is also a “tax dodger,” despite the fact that Mr. Cook claims that Apple paid over 6 billion in taxes in 2012, the largest amount for any domestic Corporation.  While 6 billion seems like a large amount of money, it could be more if they were not able to stash 100 billion + in countries like Ireland and negotiate a ridiculously low tax rate of 2% in the process.  Apple, of course, is not alone in doing this, and there are many high priced lawyers and CPA’s whose goal is to facilitate this process.

This Corporate strategy is similar to what former presidential candidate Mitt Romney does with much of his investments.  Mr. Romney stashes his money in overseas banks and shelters it from domestic tax, and also pays tax on his investment income at the ridiculously low rate of 15%.  This low tax rate is referred to as the carried interest rule, and this rule also needs to be reformed.

Apple and Romney have done nothing wrong, as far as I know.  But the divide in America is worsening by the day, and the rich are getting richer and the poor are getting poorer.  The same holds true for corporations, and if corporations are to be treated like people (as many feel they should) than they should pay tax like people too.  Over 25% of American Corporations pay no tax, and this is just not fair.

(Source cnn money)

Win Damon and I discuss Corporate tax reform on FM 106.1 WNBP and wnbp.com

With more than 23 years of experience as a credentialed tax professional, Stu Steinberg brings a broad depth of knowledge to his work. Stu founded Erock Tax to help provide tax strategies to individuals, families and small businesses. He also uses his CPA expertise to help each client navigate their long-term debt and mortgage, gaining them the best deals and rates possible. Stu is passionate about empowering his clients through education about their tax health. He is highly energetic and brings a sense of optimism, creative problem-solving and a deep level of commitment to every Erock client.

The Mortgage Interest Deduction

Mortgage Interest Deduction

Many of us who own homes can write off the mortgage interest paid on Schedule A. But who in America benefits most from the mortgage interest deduction, and what may happen to the real estate market and the overall economy if the deduction is limited in any way? These are key issues that are being hashed out in Washington, and tax reform in this particular area could very well be on the way.

A PEW research study in 2010 showed some interesting facts.  Only 1/3 of the federal filers take the mortgage deduction, and only ½ of the homeowners.  States on the east coast and west coast generally had the highest number of filers and highest average amounts of mortgage deduction taken.

Currently, the deduction is limited to 1 million total of mortgage debt.  The amount of the deduction depends on the income tax bracket of the taxpayer.  So if you are in the top bracket of 39.6%, you benefit tremendously from the deduction, far more than if you are in one of the lower brackets.  Over the 5 year period the mortgage interest deduction is expected to save the American taxpayer $380 billion.

Ideas to limit include lowering the total debt amount to $500k or $750k, not allowing interest deduction on second homes, or making the interest deduction a credit with a certain maximum as opposed to a deduction for only those who itemize.  This will allow more lower and middle income taxpayers to benefit from the write off. Many feel that the deduction should be restructured to potentially benefit those in the lower brackets, and spur them into home ownership as opposed to renting.

While we are talking about mortgage interest:  There has never been a better time to look at your debt and make sure your house is in order.  Rates are so low and it is my goal to consult with each and every one of my clients to make sure they have the best mortgage possible for their particular situation.

Click on the link below to hear Stu and Win Damon talk about this very topic on WNBP FM 106.1 and WNBP.com every Tuesday morning at 8:30.


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With more than 23 years of experience as a credentialed tax professional, Stu Steinberg brings a broad depth of knowledge to his work. Stu founded Erock Tax to help provide tax strategies to individuals, families and small businesses. He also uses his CPA expertise to help each client navigate their long-term debt and mortgage, gaining them the best deals and rates possible. Stu is passionate about empowering his clients through education about their tax health. He is highly energetic and brings a sense of optimism, creative problem-solving and a deep level of commitment to every Erock client.

Source:  CNN Money

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