Income Tax planning for Olympic Medal Winners

I came across an interesting article that happens to get published around Olympics Time every couple of years.  Did you know that the Olympic medals that Olympians win are taxable?  There is also prize money awarded for winning and that is taxable too.

Here is how it works.  Say Michael Phelps wins a gold medal prize of $25,000.  (Silver = $15,000 and Bronze $10,000).  This could be taxable as high as 39.6% for the federal and ~6% for his state.  This is a huge percentage of his earnings, close to 50%!  Now take into account multiple victories and there is potential for a huge tax bill!

There are a few of important factors here.  An athlete in a sport rich with endorsements will obviously be in a higher tax bracket.  So Phelps’s tax issues will be entirely different from many other athletes.  Also, some of the athletes participate as a hobby, and for some it is their business.  So expenses can be used to offset income for many of the athletes who operate their passion as a self employed business.

The value of the medal is also taxed, and this depends on the commodities market. Current values of gold = ~$600, Silver = $300, and bronze is practically worthless. On the open market however a gold medal will be worth far more than its actual value on the open market and at the point it is sold will have capital gains tax implication for the seller.

Tune in below and listen too our chat.  We really do have fun talking about money each week and hope you enjoy our weekly chats.  Please reach out if you ever have any questions!

About Stu: With more than 25 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 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:  http://www.usatoday.com/story/money/personalfinance/2016/08/15/olympics-victory-tax-gold-medal/88587636/

Newburyport by the numbers and Yankee Homecoming 2016

What a great week this is in the seaport city of Newburyport, MA.  It is the week of Yankee Homecoming, with art, music, and events all day for a week.  There is a road race, kayak races, slow bike races, vendors and food trucks all day every day.   There are so many activities for people of all ages.

Check out http://yankeehomecoming.com for all the key events and times.

Please support our great restaurants and shops in town.  Spend the day on the beautiful Plum Island Beaches and in town at night at one of our great restaurants.  It is always great to shop and eat local when we can.

On Tuesday I spoke with morning guy Win Damon on FM Radio 106.1 “The Legends” about our fair city and some of its key data.  The economy has gown in town over the last 15 years, as has the median price for homes and average salary.

We hope to see you soon in our great city!  Give a listen below to our chat.

About Stu: With more than 25 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 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.

 

Fun Money Game Show Trivia on WNBP Radio with Win and Pete!

I have always enjoyed my weekly chats with Win Damon on WNBP every Tuesday morning at 8:35.  We certainly talk about so many challenging money topics.  It is good to change it up every once and a while and have some extra fun.  So I recently brought in Manager Pete Falconi and we played a little “money” trivia.  I mean ACTUAL money.  Like how old is money and how much does it cost to print etc.  Who knew that paper money is actually not made of paper, but 75% cotton and 25% linen with synthetic fibers woven throughout the bill!

Tune in below and listen too our chat.  We really do have fun talking about money each week and hope you enjoy our weekly chats!  Please reach out if you ever have any questions!

About Stu: With more than 25 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 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.

Stu chats Home Buying with Mortgage Banker Bob Pezzella

A few times a year I love to bring Mortgage Banker Bob Pezzella on the radio with me in my trusty Tuesday am slot with morning guy Win Damon.  Talking about buying a home is stressful, and the rules put in place to help the consumer have actually made the process harder, more costly, and its taking longer to complete deals.

In other words, it PAYS to be proactive when even THINKING about buying or refinancing.  Get all your ducks in a row and you won’t be let down if you find your dream house and you just are not ready to buy it.

Listen to our chat below on WNBP FM Radio 106.1 In Newburyport, MA.  Streaming live at WNBP.com.

About Stu: With more than 25 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 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.

 

RVCS Kids Visit Radio WNBP in Newburyport with their Summer Tips!

On a beautiful spring day the 1st, 2nd, and 3rd grade kids from Karen and Katie’s E1 class at the River Valley Charter School walked to radio station WNBP (FM 106.1) here in town.  The kids got a tour from General Manager Pete Falconi and they even got to record their favorite summer tips for the audience to hear.

Listen below to hear the great tips for the summer.  The kids really enjoyed their time at the station, which broadcasts live from the beautiful seaside City of Newburyport and always streams live on the web at WNBP.com .

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Stu Steinberg chats with realtor Ron April of Remax in Newburyport

iStock_000062644558_FullThe real estate market in the Newburyport area is booming and should continue says Ron April of Remax Realty.  Ron and I joined morning guy Win Damon on WNBP to chat about the market here in town and discuss strategies for selling and buying a home.

Now there is so little inventory on the market that anything even half decent gets bids right away.  The spring market really gets going far earlier than it has in the past  It takes one warm day in early February to kick off the spring market.  

One important point from Ron.  It is vital to stage your home and get it in the best shape it can be for selling.  Also,  hire a great realtor, not a good one!   You pay the same either way!

Listen to our chat below on WNBP FM radio 106.1 Newburyport.

 

Stu’s Radio chat with local entrepreneur Jeremy of Grand Trunk Imports

erockI always have such a great time talking to Jeremy Kirkpatrick of the Grand Trunk wine and cheese shop here in Newburyport.  He is so full of knowledge and it really shows as he explains to me the wines and cheeses I purchased over the holiday season.

Today on radio WNBP 106.1 FM we talked about the intricacies of organic vs biodynamic wine and how it affects the individual.  I know myself that the type of wine I drink is very important to my health as it often affects my sleep and how I may feel the next day.  Jeremy always directs me to the right wines for my body.

It is also great how he and his family personally travel to the vineyards and see the production of the wines they sell.  Jeremy also has to personally taste every wine to make sure it meets his high standards!  It is a tough job but someone has to do it.

Please click below to hear our chat with Win Damon on WNBP FM Radio 106.1, AM 1450, and on the web at WNBP.com.

 

 

Halloween and the Economy

SONY DSCThe candy industry here in the United States is a whopping 20 billion dollar a year business. Candy, Candy makes up about 1.9 billion dollars of the Halloween “budget.” Decorations $1.65 billion, greeting cards  $350 million, and costumes take the cake at 2.12 billion dollars. On average, houses in America spend around $44 on Halloween candy every year, and the candy purging starts usually around October 21st

Americans consume around 24 pounds of candy each year, which is the equivalent of 247 and 3/4 hershey’s chocolate bars. This goes without saying that the most candy is eaten in the few days before Halloween, but mostly in the days to follow it. The top selling kind of candy is ——— you guess it! Candy corn. We consume around twenty million pounds of candy corn, followed by snickers in second place, dresses peanut butter cups at third, kit kats and number four, and m&ms pulling up the rear at fifth place.

After deciding what to dress up as for Halloween the next important question is, “chocolate or non-chocolate candy?” Out of the 1.9 billion dollars spent on Halloween candy around 1.2 billion is spent on chocolate candy, leaving about 680 million dollars on non-chocolate flavored candy. What do we all like the least? Those weird warm-colored taffy candies that no one likes but somehow end up in our candy stashes. Those are the first to be offered when trading the loot with others.

Major spending holidays, like Halloween, can sometimes have significant short-term benefits for the economy. People are encouraged to buy extra things that they might not usually need to buy. This stimulates our economy and helps it to grow. Some people argue that the current state of the economy affects the Halloween industry more than it affects the economy. For example in a down economy patrons might be less likely to spend their money on “unnecessary” things like candy, costumes, decorations and pumpkins, thus less stimulation of the economy. It is also possible that some families anticipate spending more during the Halloween season than they normally would during the year. As a result they anticipate this by saving more money in the months prior ( July, August, September) which reduces gross spending during those times.

The most important part of Halloween is that everyone have fun, stay safe, and enjoy their fair share of tricks and treats.  Listen below to Win Damon and I chat this up on WNBP FM radio 1061.1 Newburyport and WNBP.com.

Sources

http://www.creditloan.com/infographics/the-economics-of-halloween/

http://www.investopedia.com/ask/answers/102714/how-does-halloween-affect-economy.asp

A Review of GOP Presidential Candidate Donald Trump’s Income Tax Plan

Close - up US Tax income form

I spoke with Win Damon last week about Mr. Trump’s income tax plan.  His plan would cut taxes and lead to higher incomes for taxpayers at all levels of income, including the wealthy and the super wealthy.  In many ways it is a classic GOP tax plan where the money flows from the rich in the form of huge tax cuts and trickles down to the middle and lower incomes though jobs and further economic gain.

Single filers making less than $25,000 and married filers making less than $50,000 will pay no taxes on the plan.  Currently around 45% Americans do not pay any tax and the number would increase under Trump’s proposal.

One point of interest is that Mr. trump wants to go after one particular group of super wealthy folks and make them pay their fair share:  The Hedge Fund Guys.  He’s talking about them everywhere.  They pay income tax at the long term capital gains rate of 23.8% instead of the ordinary income tax rate of 43.4% on monies that they earn.  The key here is that they are not risking their own money, and should be taxed at the ordinary income tax rate like all other workers who are not risking there own money!

In the end, Trump’s plan cuts rates at the top and the very top even more than Jeb Bush, and this will surely lead to more arguments about trickle down and inequality in America.

With more than 25 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 in many areas of personal finance.  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.

Click below to hear the chat with Win Damon on WNBP.com and FM radio 106.1 WNBP in Newburyport, MA.

Stu chats mortgages on Radio WNBP with Bob Pezzella

iStock_000062644558_FullI recently spoke with local mortgage banker Bob Pezzella about the real estate market here in the beautiful seaside city of Newburyport.  Bob has been at his craft for close to 20 years helping families navigate the mortgage world and helping them buy and refinance homes. It is always great to have someone on your professional team who fully understands the ins and outs of the mortgage world and who genuinely cares about you and your family.

Rates are still at historic lows and now may be a great time to check in to see if a deal can benefit you.  We can help you analyze your current debt structure and see if a new mortgage will work. Or maybe you are considering selling your home and moving into a new home.  Either way it pays to be proactive and get all the information you need before making such a big decision.

Listen below to our chat on FM 106.1 WNBP Newburyport and streaming live on WNBP.com. We talk about the new mortgage disclosures that are required and how it is more important than ever to get pre-approved for any mortgage you may want.

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