6 - March 16, 2012 | Hudson - Litchfield News
Piece of the Pie Maintaining Your
401K or IRA? W.F.Bo
utin EA - Total Tax Solutions LLC
Last week we discussed the benefits of deferred compensation plans such as the 401K. We saw how it affects the income tax return by lowering AGI and taxable income. Matching contribu- tions from an employer increases the value of such a plan. Other benefits of the 401K, not previously mentioned, are the higher contribution caps as opposed to an IRA, $16,500 for 2011 and an additional $5500 as a catch-up amount for taxpayers over 50, (these totals do not include employer contribution.); some employer 401K plans allow for qualified loans which are not taxable (if you should leave the company’s employ before the loan is repaid it can become an early distribution, fully taxable with penalties). Some issues that may be considered a negative are 401K plans only allow distributions in the case of hardship or after age 59 1/2. The penalty on an early distribution is not wavered for education expenses or first time home purchases as they could be with a traditional IRA. The 401K is not very “liquid” when funds are required. Taxpayers who do not wish to “place all of their eggs in one basket” may want to consider the possibility of contributing to both a 401K plan and an IRA.
An IRA has contribution limits of $5000 for 2011 with a catch-up amount of an additional $1000 for taxpayers 50 or older. Contri- butions amounts are limited to earned income. Loans are not permitted on IRA plans. They are more “liquid” because amounts can be withdrawn at any time, however distributions from a Traditional IRA will be fully taxable, unless the IRA contains non-deductible contributions. These distributions will increase the AGI, taxable income and possibly the tax bracket on the tax return. Unless an exception to the penalty applies, such as distributions for qualified first-home purchases or qualified education expenses, a 10% penalty is also imposed on the early withdrawal (the same as with a 401K).
When discussing IRA plans we need to distinguish between the Traditional and the Roth.
Contributions can be made to both plans in the same year, but the total amount contributed cannot exceed the contribution limit or earned income for the year. Contributions to a Traditional IRA may be deductible on the income tax return. Whether it is deductible depends upon income, filing status and if you are already a participant in an employer’s retirement plan. All individuals can always contribute the maximum limit to a
Traditional IRA, providing the earned income rule is met; but if it is not deductible in full on the tax return, taxpayers must keep track of their basis (the non-deductible portion), since it will not be taxable when distributions are taken (Form 8606 is used to keep track of these after tax contributions). Contributions to a Traditional IRA can be made for the current
tax year up to the due date of the income tax return. This is an important tool for taxpayers who owe additional tax on their return. They have the ability to contribute to an IRA and lower their taxable income or tax bracket for the preceding year, providing it is deductible. Distributions from a Traditional IRA are fully taxable on the income tax return. Contributions to a Roth IRA are never deductible. Contributions to a Roth IRA may also be limited based upon your income, filing status and if you contribute to another IRA. With a Roth IRA, a distribution of the contribution amount is never taxable. The earnings may be taxable if certain criteria are not met. This makes the Roth IRA a very attractive tool in financial planning. It may not be deductible, but is very “liquid” for emergency purposes without affecting the tax return income totals.
Next week: TheValue of Fringe Benefits.
Have a tax question? E-mail email@example.com
About Total Tax Solutions: W.F. Boutin EA registered Total Tax Solutions in the State of NH as a LLC in the summer of 2006 after 10 years experience working for a major tax preparation company and 8 years of teaching various tax courses. The company mission is to deliver an excellent customer service experience year around, to offer knowledgeable advice so that clients can make informed decisions regarding their financial future, and to provide this service with integrity, confidence and professionalism.
In My Opinion...
by Bryan Donovan, Chairman, Hudson Republican Committee This is in response to the “In My Opinion” in the March 9 Hudson~Litchfield News under the heading of the League of Women Voters of NH, titled “NH Citizens Deserve Honesty from House Leadership.” The very first thing I did after reading this Op-Ed was to do an Internet search on its authors. When
I see someone using a certification/title such as “Election Law Specialist” I am curious. First hit on Bing for Joan Ashwell is from http://fundrace. huffingtonpost.com
stating she is a self-employed, “political consultant” and donated $645 to Hillary Clinton in 2008-2009. I am sure in some people’s mind being a political consultant for the Democrat Party and a Hillary Clinton financial supporter does kind of make you an “Election Law Specialist.” I don’t believe that for most honest, hardworking Americans that is the definition we would expect. My next search was on www.opensecrets.org
website which contains a lot of useful information on campaign donations registered with the Federal Election Commission. It shows who and how much were donated. A search of the three authors turns up the “Election Law Specialist” from Durham, NH, Joan F. Ashwell with one donation of $250 to Hillary Clinton on February 7, 2008. Surprisingly the donation amount on opensecrets.org
Website doesn’t match the total on the huffingtonpost Website. Not sure exactly what that means because I am not an “Election Law Specialist” but I do find that very interesting. In my professional life I have certifications that I have earned and used, such as MCSE (Microsoft Certified Systems Engineer). It is well known in the software industry that Microsoft Corporation accredits this certification. I checked the Website for the League of Woman Voters to see if “Election Law Specialist” is something that they certify and accredit. Type in “Election Law Specialist” on the www.lwv.org
Website and low and behold the only hit you receive is a posting dated January 12, 2012, by guess who, “Joan Flood Ashwell, Election Law Specialist.” So if anyone knows how one goes about being able to use the title “Election Law Specialist” and the training/testing involved in the process please post it on the Web. Every American has the right to donate to campaigns in accordance with the existing laws as they see fit. In addition, Americans have the right to research into the background of those individuals that hold themselves out as specialist or experts. At least for the time being we do. Okay, now we have some understanding of who wrote this Op-
Week 8 3-16-2012
by Michael Harte, Campbell High School Intern A team from Campbell participated in this years Penguin Plunge
event in Hampton. The plunge supported the Special Olympics New Hampshire (SONH) on February 4. The team included students John Cialek, Jason Rodonis, and Tyler Guarino and faculty members Mrs. Ange, Coach Mayo, and Coach Allen. Mrs. Ange was the flock leader for Campbell and helped with raising money for the group and put this together. The Special Olympics has 52 chapters all across the U.S. and some held something similar to the Penguin Plunge, which the New Hampshire chapter holds every year. For example, the Maine chapter holds a Lobster Dip every year, which is their version of the Penguin Plunge. The people who are participating raise money for the Special Olympics, and it occurs on New Year’s Day every year. The Penguin Plunge is a fundraising event that the SONH holds, with people who are willing to jump into the Atlantic Ocean at Hampton Beach. This event has been going on since 2000 and has been increasing the amount of people willing to jump into the Atlantic ocean
by Bryan Donovan In Response on Election Fraud
Ed, let’s look at the merits of their argument. One of the arguments against Voter ID is that there just aren’t any cases of voter fraud in New Hampshire. I interpret the second paragraph of their Op-Ed to make this contention. In the last 10 years there have been only two prosecutions of voter fraud in NH. That is not to say there haven’t been any complaints of voter fraud. There have been many. Here is just one case of voter fraud in Manchester from 2005 that has documentation available to the public. An election law complaint was filed against Geoff Wetrosky while he was the campaign Manager for Mayor Baines (Democrat). Mr. Wetrosky is a native of South Dakota and worked for Bob Baines during the 2005 campaign. While in Manchester, Wetrosky was accused of stealing political signs and was confronted by Manchester Police. Wetrosky told the police that he was living at 192 South Mammoth Road in Manchester at the house of (then) NH Democrat State Chairman Kathy Sullivan. He told police he had no intention of moving to New Hampshire and would be returning to South Dakota after the election. A copy of the voter checklist of Manchester (available to the public) shows that someone named Geoffrey Wetrosky from 192 South Mammoth Rd actually voted in 2005. Copies of both these documents have been submitted to Hudson~Litchfield News along with my article. So here we have a “professional” Democrat party operative that voted in New Hampshire in 2005 while not meeting the residency requirements and was not prosecuted. The question here is why wasn’t he prosecuted? Just for the fun of it do a search on “Geoff Wetrosky” and note that he was the South Dakota Campaign Manager for Hillary Clinton (Democrat) in 2008. If anyone wants to see the documentation on Geoff Wetrosky and lots other NH voter fraud cases come to the May 23 meeting of the Hudson Republican Committee as we host a workshop on Voter Fraud by Ed Naile, president of the Coalition of NH Taxpayers. Also at this meeting a member of the Alvirne Young Republicans will make a presentation on the history of Democrat Party Voter Suppression based on the book American History in Black & White by David Barton. Details are available on the hudsonrepublicancommittee.org
Website. So if the League of Women Voters of NH is so concerned with the “honesty” of those proposing a voter ID bill in New Hampshire, perhaps they should be equally concerned about the honesty of those among their group that hold themselves as “Election Law Specialist” in opposition to the Voter ID bill.
In My Opinion is strictly an OP-ED column that stands on the opinion of one writer, Bryan Donovan, as opposed to a newspaper reporter who does not provide an opinion but reports the facts. This column, in many instances, is a counterpoint to published stories and does not reflect the unbiased reporting policy of the Hudson~Litchfield News or the opinion of the management, advertisers and ownership of Area News Group.
CHS Students Took a Cold Dip for Charity
every year since. When it first started, there were only 159 people participating and this year there were 703 people. The Penguin Plunge was on February 5, and the day before was the High School Plunge which is an event open to high school students and faculty where they jump into the Atlantic Ocean. The High School Plunge has been going on for four years. This year the High School Plunge raised $179,688, and the Penguin Plunge raised $508,692. In total, they raised $688,380 for the Special Olympics. There were 43 high schools from all over New Hampshire participating in this year’s High School Plunge. Campbell became part of the Penguin Plunge because the New Hampshire Interscholastic Athletic Association (NHIAA) introduced the school to Tricia Messler, who is the Field Services and Project Unify Manager for the SONH. She told them about the plunge and they were interested in participating. This year was the second year Campbell did this event. Campbell raised $1,500 for the Special Olympics by having the spirit team raise money during basketball games and the school’s NHIAA ambassador and leaders also collected money during the lunch periods. When asked about the work for the donations from the school, Mrs. Rothhaus said this was “a true team effort!” Also when asked about the day, Mrs. Ange said “the water was very cold.” All involved were very proud to have participated and to raise money for a great cause.
Dr. Seuss Celebrated at GMS
submitted by Melina Prevel-Turmel, Connie Faro, Erin Beach, Shaun Elliott
At Griffin Memorial School during the week of March 5 we had a weeklong celebration honoring Dr. Seuss and Read Across America. Students participated in daily themes related to Dr. Seuss books. We kicked off the week with Crazy Hat Day followed by PJ Day, Wacky Wednesday, Tiger Day and Body
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Billboard/Storybook character Day. Activities included reading the NEA Reader’s Oath as a school, answering trivia questions based on passages from Dr. Seuss’ books, and partner reading with various classes of different grade levels. With the help of our music teacher, Barbara Labelle, a Dr. Seuss tribute song “Dr. Seuss We Love You” was sung school wide. We also enjoyed tasty Dr. Seuss themed lunches thanks to our great kitchen staff under the direction of Hilda Lawrence, the director of food services. The children were even read Dr. Seuss and other food-related storybooks during their lunchtime by Mary Franck. Overall, the students and staff had a fabulous time celebrating the famed author and our love of literacy.
Your Best Friend can still have Fun while you work: DOGGIE DAYCARE
D Canine Center V E Beginner Obedience I- For dogs 6 months old and older. Starting March 19th
Beginner Obedience II- This class is for dogs and handlers who have completed Beginner I or equivalent course. Starting March 19th Puppy Kindergarten- For Puppies 10 weeks to 6 months old. Starting March 20th
Agility Level I & II (I) Basic obstacle familiarization, i.e.: climb ramps, go through tire, etc. (II) Target training, obstacle discrimination and simple sequences.
48 BRIDGE STREET, NASHUA, NH (603) 889-9800
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