Editor: Crass Cash

How would you like to keep 20% more of your income?  Well if you're Mitt Romney and not Jeb Bush you can do that.  I say that because Jeb Bush just released his taxes for the past 33 years!  That's the most I've ever heard of and it's interesting to see.  

Two things jump out immediately.  First, apparently politics pays because he saw a jump of around $200k from being governor to around $2 million right after leaving office.  Secondly, he didn't earn his money the same way that Mitt must have because he paid an assload more in taxes.  

How could this be?  Well if you've read all of this blog you'll know that taxes on capital can be structured to be drastically lower than taxes earned on income, like 20% lower.  Mitt Romney knows this because he's a finance guy and has thus setup his assets in a way that takes advantage of it.  Would you rather make $100k and pay $33k in taxes or $15k?  

Payroll taxes are a killer.  If you're self employed and pay yourself a salary, you're going to have to pay both sides of payroll taxes.  That's 15% right off the top before you even start talking about the federal or state taxes.  Income derived from investments on the other hand, you don't have to deal with any of that shit, assuming it's passive income.  

Moral of the story is to make money via assets and not the sweat of your brow.  If you love your job and the company that you run, that's 100% fine.  Just know that according to our tax structure, you're going to pay dearly for it.  

Editor: Crass Cash

http://www.thestreet.com/story/13187068/1/saving-for-retirement-could-soon-become-even-more-painless.html?puc=yahoo&cm_ven=YAHOO


I first read this book a number of years and I totally agreed with it in regards to this circumstance.  Congress is looking to make it mandatory for people to be automatically signed up into their employer's retirement plan.  This is good because countless studies have shown that the participation rate flips vs when they have to do it on their own.  It goes from 1/3 to a 2/3 participation rate.  

I'm glad to see that Congress is working on this in a bipartisan way to help the American people.  You should still be able to opt out of it, but at the very least it gets people talking about investing and retirement.  

IRS Newsletter

In general, under the employer shared responsibility provisions of the Affordable Care Act, an applicable large employer may either offer affordable minimum essential coverage that provides minimum value to its full-time employees and their dependents or potentially owe an employer shared responsibility payment to the IRS. 

Here are definitions to help you understand affordable coverage and minimum value coverage.

Affordable coverage: If the lowest cost self-only only health plan is 9.5 percent or less of your full-time employee’s household income then the coverage is considered affordable. Because you likely will not know your employee’s household income, for purposes of the employer shared responsibility provisions, you can determine whether you offered affordable coverage under various safe harbors based on information available to the employer.

Minimum value coverage: An employer-sponsored plan provides minimum value if it covers at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan.

Under existing guidance, employers generally must use a minimum value calculator developed by HHS to determine if a plan with standard features provides minimum value. Plans with nonstandard features are required to obtain an actuarial certification for the nonstandard features. The guidance also describes certain safe harbor plan designs that will satisfy minimum value.