California Estate Planning Blog by Kevin Staker

December 18, 2017

Personal Biography Website of Kevin Staker, kevin-staker.com, Is Back Up by Kevin Staker

Filed under: Uncategorized — Kevin Staker @ 11:25 am

Personal Biography Website of Kevin Staker, kevin-staker.com, Is Back Up

The personal biography website of Kevin Staker, kevin-staker.com, was down for several weeks.  It is now back up.  It is found at kevin-staker.com.

The site has many interesting facts regarding the law and mediation practice of Kevin Staker.

Kevin Staker  is the president of his law firm, Staker Law Tax and Estate Planning Law Corporation.

He has a bachelor’s degree in Economics from Brigham Young University and law degree from the University of Utah. He also has a Master of Laws in Taxation degree from New York University.

Kevin Staker is admitted to the State Bars in California and Utah.  He is certified as a specialist in both Taxation as well as Estate Planning, Probate and Trust Law by the California Board of Legal Specialization.   He is one of the few attorneys in the State of California with such a dual specialization.

By Kevin Staker

 

December 17, 2017

Humorous Insights in the Tax Cuts and Jobs Act by Kevin Staker

Filed under: Uncategorized — Kevin Staker @ 3:17 pm

We now have the conference committee report.  A few humorous insights:

Qualified Business Income

The corporate rate is being cut.  This is a disadvantage to small business owners.  The final bill has a great item for the poorer business folk.

This is great if you do not make too much money, like the donut shop owner or shoe repair guy.  They get a 20% deduction on the lesser of taxable income or “qualified business income (“QBI”).”  However, if you are in a service profession, such as attorney (me), CPA or physician, the deduction starts to phase out as taxable income exceeds $157,500 for single taxpayers, $315,000 for joint filers.

In the past we worried about ordinary income versus capital gain.  Now we have a third category to worry about, QBI.  Surely we will find ways to game the system.  Even complying will be challenging.  This is real complex stuff, for example if you are a CPA and own a restaurant, these two businesses will be treated separately.  This is not tax simplification, no filing on a postcard as President Trump promised.  This actually should be called “The Tax Preparers Full Employment Act of 2017”.

So the message for most people: self employment is better than employment.  This flies in the fact of Thomas Jefferson’s  Declaration of the Rights of Man and of the Citizen.  The Declaration says this about taxes:

A common contribution is essential for the maintenance of the public forces and for the cost of administration. This should be equitably distributed among all the citizens in proportion to their means.

 

State Income Taxes

Limiting the total deduction for state and local property, income and sales tax to $10,000 is a very big deal.  Many fewer people will be able to itemize deductions.  This does away with the prior great idea of prepaying income taxes for several years.  Oh Well.

However, the law says nothing about prepaying property taxes.

Kevin Staker will continue his quest to find some humor in the 2017 tax act.

By Kevin Staker

December 14, 2017

The Conference Committee of Congress on Tax Reform Reaches Agreement

Filed under: Uncategorized — Kevin Staker @ 7:38 am

Senate-House Conferees Reach Agreement on the Tax Cuts and Jobs Act of 2017, the Republican Version of Tax Reform

Top individual tax rate is lowered from 39.6 percent to 37 percent.

Corporate tax rate is lowered from 35 percent to 21 percent — this rate is 1 percentage point higher than the 20 percent rate initially passed by the Senate and House.

Deduction for pass-through businesses is set at 20 percent.  This deduction when combined with the decreased top rate for individuals makes a top marginal tax rate of 29.6 percent.

Mortgage interest deduction is lowered to $750,000.  This amount is a compromise.  This is half way between the $500,000 limit passed by the House and the prior $1 million limit of the law favored by the Senate.

Estate tax exemption is doubled.  This was the Senate position. Hence for 2018, the exemption will be $11.2 million.  This rate is indexed for inflation from 2010 from $5 m

Income tax exclusion for tuition waivers are preserved for grad students.  This was the Senate position.

Deduction for student loan interest is preserved.

Deduction for medical expenses is preserved.  The House wanted to eliminate the deduction.  However, the floor is actually lowered for two years from 10 percent to 7.5 percent of adjusted gross income. Senator Collins of Maine, a Republican moderate, insisted on this change to assure her vote.

Corporate alternative minimum tax is repealed.

Exemption for the personal alternative minimum tax is raised from $54,300 to $500,000 for individuals and from $84,500 to $1 million for families.

Penalty for not having health insurance is repealed.   This effectively eliminates ObamaCare’s individual mandate.

The Arctic National Wildlife Refuge is opened to energy exploration. This was required to get the vote of Senator Murkowski, another Republican moderate. Adding a non-tax provision was required for it to be a reconciliation bill, so only a majority vote is required in the Senate. Otherwise the Senate filibuster rule of 60 votes would required. This is how Democrats in 2010 got the Affordable Care Act, Obamacare, passed.

Note, not all of the bill has been drafted. They are still working on other details, such as how many tax brackets to have. We shall see.

This article has been written by Kevin Staker. Kevin Staker is found on Twitter at https://twitter.com/kevinstaker. The Superlawyer profile of Kevin Staker is found at https://profiles.superlawyers.com/california-southern/camarillo/lawyer/kevin-g-staker/d9fa5c59-0c2a-4e8f-94e0-682892fe4481.html. Kevin Staker is also on Facebook at https://www.facebook.com/Kevin-Staker-of-StakerLaw-38289441240/. Finally, please note the probate and trust mediation practice of Kevin Staker has completed its first, very successful year. The website is found at http://kevin-staker-mediation.com/.

December 9, 2017

Differences Between Senate and House Tax Reform Bills by Kevin Staker

Filed under: estate tax,Kevin Staker,Uncategorized — Kevin Staker @ 6:22 am
Tags: , ,

Differences Between Senate and House Tax Reform Bills by Kevin Staker

 

The two houses of Congress have passed two separate tax bills:

Major Differences:

  • Medical Expense Deduction – House repeals and Senate actually expands.
  • Mortgage Interest Deduction – House reduces maximum loan amount to $500.000 and Senate keeps at $1,000,000.
  • Graduate Student Tuition Waiver – House treats as taxable income and Senate keeps tax free
  • Pass Through Income – House caps rate at 25 percent but excludes service businesses and Senate adopts a 23 percent income deduction for all businesses, including professionals.
  • Alternative Minimum Taxable Income – House repeals corporate and individual, and Senate retains corporate and retains individual but with higher exemption.
  • Estate Tax – House increases exemption to $10 million indexed for inflation since 2010 with repeal in 2023, and the Senate does the same but no repeal.

The two houses will next have a conference committee to hash out the differences.  I suspect the final bill will be closer to the Senate version because they can afford to lose only one more Republican senator.

We shall see.

By Kevin Staker

December 8, 2017

Kevin Staker is a Probate and Trust Mediator in Ventura County

Filed under: Uncategorized — Kevin Staker @ 10:10 am

Kevin Staker is a Probate and Trust Mediator in Ventura County.

In probate or trust mediation, the parties work with a neutral mediator to try to resolve their disputes without litigation and an eventual trial. Parties may go to mediation before or after filing a lawsuit. The parties and their attorneys meet with the mediator in a private, confidential setting.

The probate and trust mediation website of Kevin Staker is found at http://kevin-staker-mediation.com/.  The website includes a page by Kevin Staker on Principles of Probate and Trust Mediation, this is found at http://kevin-staker-mediation.com/principles-probate-trust-mediation/.  Another page by Kevin Staker is Focus of Probate and Trust Mediation; this page is found at http://kevin-staker-mediation.com/trust-probate-mediation-focus/.

By Kevin Staker