Archive for Money and Business

The 2017 Tax Returns Filed

taxes.jpgOur Investment Consolidated 1099 forms were finally available today, so since the returns were 99.9% complete, we filed both Arizona and Federal Tax Returns online this afternoon. We were somewhat aggravated that it took so long to officially get the numbers on the proper forms, but now it’s done and we can start waiting for our refunds.

The 2017 withholding rate we used underestimated the effect of upgrading our motorhome for which larger amounts of Vehicle License Fees and 2nd home loan interest would work to our benefit. As a consequence, we overpaid into the Federal and State coffers all year.

Now, we can start to calculate and adjust the amounts to be withheld for the remainder of 2018. We have a spreadsheet that we used in the past to figure the proper withholding and will resort to it again this year. There are a couple of complications involved, however, due to the effects of the GOP Tax Reform and an increase in the IRA distribution.

Our Arizona withholding will be zero this year because we contribute to the Arizona Private Education Scholarship Fund which completely offsets our state income tax obligation. For Federal Tax, we will use an assumed effective tax rate to determine withholding. As an aside, the IRS withholding calculator is not available because of the recent tax reform bill.

Bottom line, we’re glad to have 2017 tax behind us. Now to figure out how to spend the refund!

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2017 Tax Return (Almost) Complete

irs_logo.pngWe have received all but one tax form from our various sources of income. The last of the 1099’s to arrive (as usual) was the one from the Social Security Administration, the SSA 1099. We had an additional set of 1099 forms this year due to our pension administrators decision to switch financial providers during 2017. Not a big deal, but two additional income sources to input into the tax program.

The last form (1099 B) which we have not yet received deals with investment income; we had a negative capital gain in 2017 when we sold mutual funds to acquire the new RV. I completed the inputs for this event into the tax program, but there are a couple of items I still do not have to finish up the input for the investments section. For that reason, I won’t be able to file the return until about the middle of February. The numbers won’t change, but the missing information is required by the IRS.

I mentioned on the other blog that we would be getting a refund this year. The final calculation shows that to be true. Damn, I hate lending the .gov interest-free money, especially given the amount of the over-payment in 2017. Given the new tax deal from Trump and the GOP, I will have to make some wild guesses as to how much “tuning up” our withholding needs. I am especially anxious to file the returns so we can get our money back ASAP.

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Unaffordable Care Act

Chart -2015 to 2018

My former company’s retirement plan is conducting their annual enrollment period for healthcare insurance this month. The retirees, their spouses and dependents may select one of several plans during the open enrollment period.

I went on the website to make our selections for the coming year and, much to my annoyance, the premiums are going up yet again. I decided to look at the recent history of the rates and came up with the chart above. The image has neither legends nor scales, but I am going to explain them.

The four vertical cubes represent 2015 through 2018 and the height of each shows the relative amount for the premiums. I limited it to these four years since that is the period when the Obummercare mess has screwed up the system for everyone, not just ACA exchange subscribers.

The chart applies only to Damsel’s insurance premiums that we pay monthly. I did not do the complex analysis of my Medicare and Medigap (for the 20% that the .gov doesn’t pay) which I may do one of these times. Below are the results according to the chart above:

  • Increase from 2015 to 2016 - 10%
  • Increase from 2016 to 2017 - 30%
  • Increase from 2017 to 2018 - 12%

That’s a whopping total of 52% increase over a period during which we realized NO additional cost of living compensation. We are on virtually a fixed income. The last Social Security cost of living increase was exactly canceled out by an increase in my Medicare part B premiums.

This is yet another example of how the Government screws us up by trying to “help” us.

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RV Shopping

RV Shopping

So how does this Thor Palazzo 33.2 look parked in front of or house? Just kidding - the image is a composite of our abode with a transparent .png of the coach lifted from the Thor Palazzo website.

We have been giving some serious thought to upgrading our motorhome even though we only acquired it last December. We have found that there are some shortcomings with our RV choice. The three major things we want to improve upon are: 1) engine cockpit noise, 2) rough riding suspension (like the truck it really is) and 3) the lack of air conditioning capacity.

The latter item is the big one on that short list since we visit deserts in the summer. Hell, we LIVE in a desert in the summer. The A/C is an 18,000 BTU unit but fails miserably when it’s 110 outside. We’re lucky if it gets the inside temperature down to 95° under those conditions.

There are a couple of RVs we’re looking at to resolve the problems above. Each of them under consideration likely solves the three problems described.

We also have a wishlist above and beyond the short list that I won’t elaborate on here, but Damsel would be pleased to have a washer/dryer stack on-board, and we both like the idea of extra living space when pop-outs are deployed. Further, we can’t afford to add more than a couple feet in length over the 32 footer we have if we’re going to be able to get it through our RV drive.

In my research, I have only found a couple of floorplans that meet the length limitations while having a few features that we like (and some that we don’t). I think that we might have to take some time in doing trade off evaluations to make a final decision.

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A Twentieth Century Icon - Howard Hughes

Howard R. Hughes, Jr. 1904-1976Between 1965 and 1980, I was employed at Hughes Aircraft Company, generally at the Culver City Facility that contained both the Hughes Aircraft Company (which developed and built electronics systems) and the Hughes Tool Company (which developed and built aircraft and a few oil drilling tools). Sort of backwards, I know, but so were a lot of things in the Hughes Empire.

I found the long-lost poster seen at the right today when I was opening a picture frame to scan in a certificate I earned in my Ham Radio activities (DXCC for those who know) and found the poster was in the same picture frame. Frankly, I cannot remember putting it in there, but there it was in near-perfect condition. I scanned in my certificate (for another purpose) and also this poster, since I was scanning.

IMAGE: Iconic Howard Hughes portrait along with some of the Hughes legacy icons. Click on the image to enlarge to poster size.

Since I was suddenly dropped into the topic of the famous Howard Robard Hughes, Jr., I went out to Wikipedia and looked him up. I found an extremely interesting entry about Hughes’ life and times, much of which I had been previously unaware. It was intriguing and I was riveted to reading it all the way through, disregarding the references, of course. I can’t attest to all of it being true, but since I was there towards the end of Hughes’ life, I know some of it is gospel.

I never met the man, but others I knew and trusted told me of times when they had seen him come to Culver City for various visits in which they had caught a glimpse or two of the man. He had mostly gone full reclusive after I had been there a year or two.

If you’re interested in icons like Hughes, I recommend reading the Wikipedia Article (disclaimer - I can’t guarantee any of it is true, but it IS interesting). Bonus - Click here for some Spruce Goose coverage.

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Gas Under Two Bucks

Under $2Gas prices have been coming down all over the country since the summer season ended. The lowest prices here in our town are still over two per gallon, but when we were going down to the Northwest Valley today, we saw gas advertised for under $2.

Having recently made a commitment to a new gas consumption entity, we have been tracking gas prices. When we take delivery of the new beast after Thanksgiving weekend, we will need to top off the 80 gallon tank. Searching on Gas Buddy reveals a lot of prices near the delivery location to be just a shade over two bucks; hopefully, those will go down by the time we get there.

One of the business magazines (I don’t link to any Bloomberg sites because they are rabidly anti-second-amendment) speculates that gas prices could fall to $1.70 or below by Christmas. That will be good for us since we will be going to Palm Desert California one more time before then and gas will probably keep coming down in price.

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Considering Retirement Alternatives Planning

IRA Calculator (click on the image to enlarge)

Hmmm . . . I guess the acronym for the title of this post is CRAP. Oh well, that is not important.

I was thinking about the eventuality of me not being here for the Damsel or vice versa. We each have our own IRAs and have each other as beneficiaries. I wanted to see what would happen to my Required Minimum Distribution (RMD) amount should I not be here or what the withdrawal implications of hers would be if she were to be gone. Hard stuff to think about but it’s gotta be done.

I looked around on the (insert famous savings institution here) website and did not find much information on my specific concerns. Next, I used an on-line search engine with appropriate keywords and found several links. One link to the Charles Schwab IRA Calculator proved to be the exact information I needed to know since it was specific to the beneficiary of an inherited IRA.

I needed to enter several relevant items: the balance of the account as of 12/31/14, date of birth, date of death, type of inheritance (spouse), beneficiary’s date of birth and an estimated annual rate of return. The calculator itself updates immediately with each new entry. I actually like this calculator better than the one found on my IRA holder website.

The answer to my original question of “what happens if . . . ?” is - nothing! When I go, she inherits the IRA just as it is and will continue to have the required minimum distributions just as it does today. If I should inherit her IRA, RMDs won’t be necessary until the year where she would have turned 70½ and the distributions would be based on her date of birth, not mine. The IRA distribution scenarios are identical whether we’re here or not.

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