Like Many Other Deceased Musicians, Whitney Houston’s Estate Stands To Continue Earning Income

Like many other famous musicians, Whitney Houston had many financial difficulties in her life.  However, even after her death, her estate could be earning a considerable amount of annual income for years to come.  While some of the estate’s royalties will be used to pay off her debt, Whitney Houston’s estate joins a list of many others before it that will continue to reap the benefits of the decedents’ stardom.

Forbes recently released a list of the top earning dead musicians showing that Michael Jackson’s estate took in $170M in 2011 alone.  While Yahoo does not believe Whitney Houston’s estate will be as prolific, the estate could still be earning a large sum of money for the foreseeable future.

While not everyone is a platinum selling recording artist, everyone stands to benefit from prudent and effective estate planning and asset protection.  Royalties and other windfalls do not necessarily have to go to an estate, talk to the lawyers of Kohler & Smith Co., LPA today to protect your family’s financial future.

Tax Breaks: Here Today, Gone Tomorrow?

Much has been written and debated about the payroll tax cut extension passed by the U.S. Congress late in 2011.  Much less has been written about all of the other popular credits and deductions that were not extended along with the payroll tax cut.  The following tax breaks expired as of December 31, 2011 and will not be available on your 2012 tax return unless the government works to extend some or all of the following:

1. AMT Patch – without new legislation, tens of millions of families will be subject to higher taxes due to the Alternative Minimum Tax
2. Tuition and Fees Deduction – provided up to a $4,000 (subject to income limitations) deduction on income for qualifying higher education tuition and fees
3. Teachers Supplies Deduction – even those teachers who do not itemize their deductions can take a $250 deduction for supplies purchased
4. Mortgage Insurance Premium Deduction – subject to certain limitations, many taxpayers had been able to deduct mortgage insurance premiums paid, along with mortgage interest paid

The above listed deductions and tax breaks are just a sampling of the many provisions that might be different if no action is taken before the end of the year.  With the payroll tax cut fight still looming before the end of February, it would appear that no patches or fixes are on the immediate horizon.

Will Your January 2012 Paycheck Be Smaller? UPDATED DECEMBER 28, 2011

UPDATE: Congress, eight days before its scheduled expiration, passed a two-month extension of the payroll tax-cut.  Lawmakers on both sides of the debate will once again pick up the negotiations for a longer-term deal early in 2012.

The two percentage point payroll tax-cut on employees’ wages will continue through February 2012 at which time the temporary tax-cut would, once again, expire if no further action is taken.

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The sticking point on the payroll tax-cut revolves around how the initiative should be funded.  Democrats are supportive of an increase in the taxes on the wealthy while Republicans remain opposed to any tax increases.

As of the publication of this post, the United States Congress has failed to extend the 2011 temporary reduction in payroll taxes.  If no agreement is reached by year end, approximately 160 million American workers will take home less money from their paychecks beginning in January.

Much like the harrowing tax negotiations that occurred at the end of 2010, the political wrangling of 2011 is continuing right through to the end of the year.  In 2010, Congress passed a temporary reduction in employees’ payroll taxes, reducing the amount of social security that is withheld.  This reduction resulted in about $20 of extra take home pay per week for an employee earning $50,000 per year.  Without an extension of the payroll tax cut, that extra take home pay will be eliminated and a “tax increase” will occur.

There are many year end tax decisions that can save you and your family money.  Call the lawyers at Kohler & Smith Co., LPA today to discuss what alternatives could be beneficial for you!

The Estate of Steve Jobs: Will it be Taxed?

Much has been written about the death of Apple founder Steve Jobs over the past days.  One area that has received increased attention is the estate planning done by Jobs, his attorneys, his accounts, and other professionals before his death.  Forbes columnist, Deborah L. Jacobs, has recently expounded upon this topic in further detail accompanying her prediction that Steve Jobs’s estate will not pay any estate tax.

While most people are not billionaires like Steve Jobs, all families can benefit from quality estate planning.  Whether aiming to avoid probate, limit (or eliminate, potentially, in Steve Jobs’s case) estate taxes, ensure that your assets will be passed on to those you choose, support charities, or a whole host of other goals, estate planning is a good idea for each and every adult.  Estate planning is not a “one size fits all” undertaking.  By meeting with a trusted estate planning attorney, clients can maximize their goals and create plans that are specifically tailored to their needs and desires.

If you have been putting off your estate planning, call (614) 888-4911 today to speak with one of Kohler & Smith Co., LPA’s estate planning attorneys or visit us on the web at www.kohlersmith.com for more information.

2,000th Page View!

Kohler & Smith’s Legal Blog is excited to have received its 2,000th page view since its inception!  August of 2011 was the busiest traffic month since the blog was launched last September.  Be sure to check back periodically for all of your legal and tax related news and information.

Franklin County Issues First Countywide Property Reappraisal in Six Years

Last week, Franklin County Auditor, Clarence Mingo, issued the first countywide property reappraisals in six years.  To the pleasure (or ire) of many Franklin County homeowners, property values in central Ohio dropped considerably.  Of Franklin County’s 376,383 residential properties, values dropped in 6.7 percent of the properties from 2005 to 2011.  With over 75 percent of property values declining, Franklin County property owners now must cope with the fallout.

Much to the surprise of some, 19 percent of Franklin County property owners actually saw their property values increase.  To address discrepancies and disputes, Franklin County is offering 17 review sessions scheduled  through September 29.  For those property owners who challenge the new proposed valuation, decisions will be rendered sometime before the end of the year – just in time for the tax bills to be mailed at the end of December.  For those who think that the valuations are arbitrary, the Franklin County Auditor’s office has stated that it took 39 county appraisers two years to examine each parcel in the county.

Taxpayers who are either unable or choose not to utilize the review sessions over the next month, the Franklin County Board of Revision will begin the appeals process on January 3, 2012.  Property appraisers in central Ohio are busy working with property owners and many are unable to schedule new appraisals for at least two weeks.

If you or your family have recently had your property reappraised and you would like help challenging the the new auditor’s proposed value, contact the attorneys at Kohler & Smith Co., LPA today.

2012 HSA Contribution Limits

The IRS has recently announced the 2012 HSA contribution limits:

• Individual: $3,100
• Family: $6,250
• Minimum Annual Deductible (Individual): $1,200
• Minimum Annual Deductible (Family): $2,400
• Out-Of-Pocket Maximum (Individual): $6,050
• Out-Of-Pocket Maximum (Family): $12,100