taxes

Q: Dear Tax Talk, On April 13, 2007, I contributed $4,000 to my 2006 Roth IRA. The same year, I contributed $4,000 to my 2007 Roth IRA. My adjusted gross income for 2006 was over the $110,000 income limit. My adjusted gross income for 2007 was under the $114,000 income limit. I've already intermingled the money to buy and sell stocks. Overall, my Roth IRA account has a negative balance Read more...

A little boy wanted $100 badly and prayed for two weeks, but nothing happened. Then he decided to write God a letter requesting the funds. When the postal authorities received the letter addressed to God, USA, they decided to send it to the president, who was so touched and amused that he had his secretary send the boy a $5 bill. The boy's response: Dear God. Thank you very much for Read more...

Q: Dear Dr. Don, My employer offers a 401(k) and a Roth 401(k) option. In light of the potential for much higher taxes in the future, would it be wise to focus 100 percent of my retirement savings in the Roth 401(k) alternative? -- Mike Myriad A: Dear Mike, Roth 401(k) plans made their debut in January 2006. They were scheduled to sunset in 2010 but instead were extended by the Pension Read more...

A robber with a pistol confronts a person on the street. "Give me all your money!" the robber says. "Don't you know who I am?" the would-be victim says archly. "I'm a United States senator." "In that case," says the robber, "give me back all my money!" Read more...

You've been saving diligently for your retirement, but now you need some of that cash to cover today's expenses. Can you get to it without incurring Uncle Sam's tax wrath? In some instances, the answer is yes. When you take money out of an Individual Retirement Account before you reach age 59½, the Internal Revenue Service considers these premature distributions. In addition to owing any tax Read more...

Q: Dear Tax Talk, My husband and I own an electrical contracting business. I, not having prior business-management knowledge, have had to learn as we go. Our business is an LLC. We did not realize that meant that whatever income the business earned would be added to our personal income, nor were we advised that we needed to make quarterly income tax deposits for our business income to avoid Read more...

Q: Dear Tax Talk, My husband and I own an electrical contracting business. I, not having prior business-management knowledge, have had to learn as we go. Our business is an LLC. We did not realize that meant that whatever income the business earned would be added to our personal income, nor were we advised that we needed to make quarterly income tax deposits for our business income to avoid Read more...

Q: Dear Tax Talk, My question is regarding my boyfriend and his ex-wife. They are divorced with two daughters. His ex is a very difficult person to deal with, to say the least. She has taken him to court several times over the last five years. One of those times, she added that they will alternate the girls as tax-exempt on their tax returns. The judge granted this request. For 2008, he was Read more...

The local bar was confident its bartender was the strongest man around so they offered a standing $1,000 bet. The barkeep would squeeze a lemon until all the juice ran into a glass, then hand the lemon to a patron. Anyone who could squeeze one more drop of juice out would win the money. Many people (weight-lifters, longshoremen, etc.) had tried over time, but nobody could do it. One day, Read more...

Talk about adding insult to injury. As if it weren't bad enough to be laid off from a job, workers who apply for unemployment compensation might be shocked to learn that they have to pay federal income tax on those benefits. "It's a wage payment; you have to pay taxes on wages," says Barbara Moore, an attorney and unemployment law analyst with CCH Inc., an information provider on taxes Read more...