Blog

  • Free App Avoids 100% of This Tax

    Traffic apps have revolutionized how many of us get from Point A to Point B. They started with in-dash navigation systems that needed updates every time a new subdivision or interchange appeared. Then they migrated to the phone with Google Maps and real-time traffic updates. Now, apps like Waze tell you where to get off the highway to avoid traffic jams altogether — and terrorize quiet residential neighborhoods in the process. At this point, your kids probably wouldn’t recognize the vintage navigation tool known as the “folding paper map” if you used it to smack them in the face. But now there’s a way to use these exciting new apps to help reduce your tax bill, too . . . at least, if you’re thirsty in Seattle. Seattle proudly counts itself as a leader in America’s progressive movement. Seattle residents joined the rest of Washington residents to become one of the first two states to legalize recreational marijuana. And Seattle has spearheaded the growing national drive for a $15 minimum wage. Now Seattle has joined Berkeley, Philadelphia, and several other municipalities in imposing a soda tax. Wanna quench your thirst with a tasty Mountain Dew? Plan on paying an extra…

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  • Romantic Tax Collectors Love Valentine’s Day, Too

    It’s February, and love is in the air. Restaurants are advertising intimate specials for two. Florists are rolling out the red carpet. And in the greeting card racks across the country, Hallmark’s most accomplished poets are debuting their new verse. We’re talking about Valentine’s Day, of course. 62% of Americans say they’ll celebrate the occasion. (Of course, that means the rest of us will just try to keep our heads down and pretend it’s just another blah February day.) But with all those Cupid’s arrows flying around, shouldn’t the tax man get a little love, too? The National Retail Federation estimates that Americans will spend $19.6 billion this Valentine’s Day. That includes $4.7 billion on jewelry (for the truly lucky ones), $3.7 on going out, $2 billion on flowers (including, naturally, 250 million roses), $1.7 billion on chocolate and candy, $894 million on greeting cards, and $751 million on pets. That’s all before we get to the lingerie, champagne, and candles. (Guys, we know you don’t care for scented candles. Just think of them as proof that your Valentine trusts you with fire.) Naturally, all that spending means taxes. The average sales tax rate here in the U.S. is 8.454%,…

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  • Country Crooners Sing the Blues

    Country music embraces a long tradition of songs about sadness and ruin, heartbreak and pain. It just makes sense, then, that country sometimes runs afoul of the tax system. Most famously, Willie Nelson found himself on the wrong side of a $16.7 million tax bill. And outlaw country icon David Allen Coe, who penned Take This Job and Shove It, drew three years probation and $980,000 in restitution for failing to report his income, which he insisted on taking in cash to hide from the IRS. Joy Ford probably never expected she would become a part of that particular tradition. She got her start as a carnival dancer performing at state fairs. Her co-star Loretta Lynn inspired her to start singing, and she had several minor hits in the 1980s. She went on to operate the Bell Cove Club outside Nashville, where she showcased up-and-coming acts. But her eye for talent turned out to be far better than her eye for business. Ford met with a producer to talk about a TV show, and met with a consultant who suggested converting the club into a seafood restaurant. But the show went nowhere and the consultant’s advice went in one ear…

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  • Two-Tired to Fight About It

    When you think of “federal crime,” you probably think of big-ticket offenses like mail fraud, identity theft, and tax evasion. But our criminal code is also full of, shall we say, lesser offenses. For example, according to the Crime a Day Twitter feed, “18 USC §1854 makes it a federal crime to cut, chip, or chop a government-owned tree to get turpentine out of it.” 7 USC §8313 “makes it a federal crime to bring an imported camel’s blanket into the United States without the permission of the port inspector.” And 8 USC §1865 “makes it a federal crime to roller skate in Alaska’s Sitka National Historical Park.” Our Internal Revenue Code similarly focuses most of its attention on core questions like brackets, rates, standard deductions, and personal credits. But the tax code’s 70,000 pages include their fair share of lesser provisions, too. And the Tax Cuts and Jobs Act that just passed includes a couple that might sound like the tax equivalent of sneaking a smelly camel’s blanket in under a port inspector’s nose. Here’s one that just seems petty and mean. Under the old law, you could exclude a whopping $20 per month of income for expenses related…

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  • iTaxes Version 38 Billion.0

    In 2016, SyFy debuted a new show called Incorporated about a dystopian future where corporations, not governments, rule the world. If that nightmare ever comes true, we all know which real-world corporation will rule them all. It’s Apple, of course, which just took the shrink-wrap off their $5 billion ring-shaped headquarters in Cupertino, CA and is on the verge of becoming the world’s first trillion-dollar company. Odds are good that you’ve got an iDevice of some sort in your home, office, or pocket. Apple’s product design geniuses use crack-like design and technology that keeps users hooked like heroin addicts, to make Apple the most valuable corporation in the world. But what you may not know is how Apple’s financial geniuses use proactive tax planning to make their company even more valuable. And now, the Tax Cuts and Jobs Act has inspired them to act again. Apple has scattered their manufacturing operations throughout the world to take advantage of lower costs overseas. (You think your 10-year-old’s science fair project is special? Big deal — 10-year-olds in China are making iPhones!) This has prompted various entertaining debates over the ethics and politics of offshoring, which we won’t presume to touch here. Apple…

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  • How Will I Know?

    In 2012, the singer Whitney Houston died suddenly, drowning in a hotel bathroom after years of battling drug addiction. Yet the world will always treasure her musical legacy. The Guinness Book of World Records reports that she was the most awarded female artist of all time, with two Emmys, six Grammys, 30 Billboard Music Awards, and 22 American Music Awards, among 400+ awards. Rolling Stone listed her debut album as one of the 500 greatest albums of all time. And VH1 put her number three on their “greatest women of the video age” list, behind Madonna and Janet Jackson. Houston also left a considerable financial legacy, estimated at $20 million. She saved all her estate in trust for her only child, Bobbi Kristina Brown, with instructions to release 10% when Brown reached age 21, another sixth at age 25, and the remainder at age 30. (Brown died in 2015 from her own drug overdose, leaving the ultimate fate of the estate in the hands of lawyers, who are sure to bill lots of hours.) But Houston’s estate includes far more than cash and securities. It also includes her music catalog, digital performance royalties, movie and television residuals, and “publicity rights,”…

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  • NFL Playoffs: Blue States Versus Red

    NFL playoffs have begun, and Wild Card Week featured some real competition. On Saturday, the red-state Tennessee Titans barbecued the red-state Kansas City Chiefs, 22-21, and the red-state Atlanta Falcons defeated the blue-state Los Angeles Rams, 26-13. On Sunday, the purple-state Jacksonville Jaguars pounced on the blue-state Buffalo Bills, 10-7, and the red-state New Orleans Saints marched past the purple-state Carolina Panthers, 31-26. Now, if you’re like most people, you’re wondering why we’re polluting your NFL news with red state and blue state political references. You wouldn’t think politics matter on the gridiron! Unfortunately they do, now even more than before, thanks to the Tax Cuts and Jobs Act of 2017. Huh? Here’s the deal. Blue states, as a group, tend to have higher income and property taxes than red states. (That’s not always true — Washington, for example, has no state income tax at all — but it’s a fair rule of thumb.) Those higher taxes make blue states slightly less attractive for athletes who play home games subject to income tax there. If you’re a first-round draft pick wide receiver, would you rather pay a 13.3% top tax rate to catch passes in Los Angeles, or a 0%…

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  • He’s Mister Tax Miser

    Welcome to 2018! New Years’ always brings changes to taxes. Key numbers, like tax brackets, standard deductions, personal exemptions, and qualified plan contribution limits, all roll over on January 1. But this year brings more change than any year since 1987. Washington has just passed a sweeping overhaul of the entire tax code, from working individuals all the way to multinational corporations. Tax planners across the country are scrambling to ferret out the opportunities hiding in its 503 pages of typically dense, impenetrable text. (There’s a reason tax lawyers drive Jaguars.) This year’s tax bill avoids one particularly awkward tax transition we faced in 2010 — one that became, for some families, literally a matter of life or death. Remember the old children’s Christmas special, Year Without a Santa Claus, with the dueling Heat Miser and Snow Miser? Those guys had nothing on 2010 . . . the Year Without an Estate Tax! Estate taxes date back as far as 700 B.C. in ancient Egypt. (Of course, the Egyptians also buried their pharaohs with food, clothing, and jewelry for the afterlife.) Here in the United States, they began with the Revenue Act of 1862, which included gift and estate taxes…

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  • We Now Interrupt This Broadcast . . .

    On Sunday, October 30, 1938, Mercury Radio Theatre fans, who were listening to Ramon Racquello and His Orchestra, were interrupted by a news broadcast reporting an odd explosion on the planet Mars. Soon after, they learned that a cylindrical object had fallen on a farm in Grovers Mills, New Jersey. The radio audience listened in horror as a pulsating Martian emerged from the cylinder and obliterated the crowd with heat rays. Soon, an entire army of Martians had invaded New York, and very real panic had spread across the country. Last week, something a bit similar happened in the tax world. (Well, except for the Martians, heat rays, and destruction of Gotham.) After just six weeks of consideration, the House and Senate passed the Tax Cuts and Jobs Act of 2017, the biggest restructuring of the tax code in 31 years. We don’t usually use these emails to discuss “hard news” like the new tax bill. It’s much more fun to walk through the “Twelve days of Taxmas,” or how celebrities use offshore tax havens, or harken back to taxes in the 1980s as we enjoy Season Two of Netflix’s Stranger Things. But this new tax bill is simply too…

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  • The Twelve Days of Taxmas

    Every year, PNC Bank publishes their “Christmas Price Index” to track the cost of the Twelve Days of Christmas. For 2017, it’s a hefty $157,558. (And you thought your holiday spending was out of control!) The index may not be completely accurate — for example, the ten lords-a-leaping are valued using the cost of male ballet dancers, rather than actual lords, and the eight maids-a-milking don’t include eight actual cows. But still, it got us wondering . . . what sort of taxes are we looking at on the whole affair? Twelve drummers drumming and eleven pipers piping make quite a racket every holiday season. Hiring all that help will stir up a cacophony of payroll taxes! Ten lords may look perfectly happy while they’re leaping. But surely they must pay a king’s ransom in income taxes — after all, they are lords! Nine ladies dancing make a lovely sight at Christmas time — especially if they’re Rockettes. They also pay a cabaret tax for the privilege of displaying their talent. Eight maids-a-milking help make sure we have plenty of tasty eggnog to drink. Good thing so many states offer dairy tax credits to spur the cows on to higher…

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Testimonials

  • We started our residential real estate business and brought Damon on as our principal adviser for all matters relating to taxes & accounting. We have doubled our business each year and Damon is a critical partner that has allowed us to successfully focus on our business.

    – Dan and Rachel Kendall
    Owners, The Rachel Kendall Team, LLC - Raleigh, NC
  • Damon Yudichak is a diligent and consistent professional. I’ve worked with Damon since 2009 and I’ve felt like a valued customer since the beginning of our relationship. His firm is consistent, courteous, and knowledgeable. He and his firm are a vital link to my business.

    – Al Sullivan, President
    Inspirus Consulting, Inc. – Cary, NC
  • Owning a small business… to me, it’s worth millions! Bringing Damon on for accounting and tax purposes… just a reasonable monthly fee! Keeping our business legal and my business partner sane… PRICELESS!

    – Tonya Baskerville, Owner
    Art on the Fridge, LLC – Raleigh, NC

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