Feb. 9th, 2014

stocktaking

Feb. 9th, 2014 04:07 pm
thene: "'The spirit is a garden,' said he." Photograph from ColinPurrington.com (snowdrops of gratuitous self-reference)
It's Sunday, I clocked 70 hours last week, and I need to work. I took my pile of Mr Slime work out of my bag and I need to do it. But I want to breathe first ok.

We're buying the Ugly House. It's being inspected on Monday. K and me are spending all of our money on it because we were too feckless to get a mortgage approved initially (I have no credit score, but K and M did eventually get approved for a hundred grand - but not until after we put in our cash offer). I am cool with having close to no money left as we're very solvent and our costs of living after the move are going to be minuscule, and Zombies, Inc now appears to be actualfax profitable - so I can at least rely on continuing to take home $500 a week there, maybe more if shit really does get bigtime. In the meantime, I will be one of three owners of this weird, chintzy, far-larger-than-necessary house a few minutes walk from a station that's opening in about a year's time & another station that's allegedly opening in 2019, which will be shortly after K (who is paying for most of this house) finishes undergrad. The Ugly House's peculiar layout includes a bonus extra sitting room/bedroom downstairs, so we will be free to make people visit us.


You only need to be rich once; I still remember the start of the month my father died, when we had $7 left after paying the rent and had to spend $5 of it on gas to get home from taking our change to the bank. I was working two jobs, but M's job had shorted his pay by $200 and were shrugging their shoulders and telling us to wait another two weeks for them to rectify the error. That was three years and a couple of weeks ago. Just think, now I am going to have enough spare income to afford health insurance for the first time since moving to this country.

None of my three jobs provide health insurance. I have never had a job that offered health insurance. I have kind of a lot to say about stuff like this. Taxing Women offered much insight into the Ann Romneys of the world, and how the tax system enables them by providing them with tons of breaks for not working - untaxed family fringe benefits, unearned Social Security credits, being allowed to contribute to an IRA even on $0 of earned income. And as Daisy pointed out, the woman didn't even raise five houseplants; this is on my mind because I did my first Sch H middle of last week, for one of Mr Slime's clients. A Sch H is how you submit Social Security & Medicare payments for your household employees - maids and nannies and such. The client made $200k a year in a job prominent enough that when I googled her I found media interviews she'd done and she paid a nanny $9/hr to bring up her children, because raising children is such valuable work blah blah blah who cares just hide the immigrant woman who lives in your house and looks after your family and don't talk about how much she's worth to you. It's a secret between you, me, the IRS and anyone who wants to listen to me talk about you on the internet.


(After we move, I need to fill the Ugly House with houseplants. Just because.)


no seriously 1% tax returns reek of entitlement, I don't even (and $200k isn't even 1%). They also document some jawdropping stupidity and inability to handle money, hello actual 1% dude who lost $225,000 failing at flipping a house while living in it and therefore rendering the loss nondeductible, and oh i see you are also nursing a $200k capital loss carryover, I am never putting money anywhere near the financial institution you work for, I'm just saying. Mr Slime has been letting his clients deduct their fucking dry cleaning as an unreimbursed employee expense for years, and I had to break it to him that this is really explicitly not okay because the tax code says that the clothing & upkeep deduction is mostly for blue-collar workers: "It is not enough that you wear distinctive clothing. The clothing must be specifically required by your employer. Nor is it enough that you do not, in fact, wear your work clothes away from work. The clothing must not be suitable for taking the place of your regular clothing. Examples of workers who may be able to deduct the cost and upkeep of work clothes are: delivery workers, firefighters, health care workers, law enforcement officers, letter carriers, professional athletes, and transportation workers (air, rail, bus, etc.). Protective clothing: You can deduct the cost of protective clothing required in your work, such as safety shoes or boots, safety glasses, hard hats, and work gloves. Examples of workers who may be required to wear safety items are: carpenters, cement workers, chemical workers, electricians, fishing boat crew members, machinists, oil field workers, pipe fitters, steamfitters, and truck drivers."

I may be kvetching about this particularly hard because I am still embarrassingly bad at manipulating Lacerte, the 'high-end' program Mr Slime installed on my laptop (hint; it's a slowass POS compared to the one I use at Cuddlejob), and fucked up some income apportioning last week; and I am learning some real mormonism here (I decided that in the interests of accuracy I should stop referring to jawdropping but legal tax manoeuvres as 'voodoo'), some of which I want to write real posts about just in the interests of explaining to the world why they should cease to be legal as soon as possible. I should probably get on with the fucking job first, though.

Oh, and he says it's okay for me to communicate with clients by email, so long as I pretend to be some kind of...unspecified and unnecessary document assistant? and not imply I am actually doing their returns. What the everloving fuck. I'm more qualified than he is - he lists his fucking RTRP on his business card even though the IRS abolished the qualification and I am a freaking EA. Wherever I wind up working next year, I intend to ask whether my name & PTIN will be on my returns; anywhere that says no is getting a firm rejection and I will be telling them why. I think I can allow myself the staggering luxury of self-respect in my future employment decisions. Hope I really can tolerate Mr Slime for two more months. (ETA: while dithering over composing an appropriately misrepresentative email to one client, I have added the letters after my name to my gmail handle out of pure, passagg malice. I may be turning into Esq - who, incidentally, has been a COMPLETE flake this year, but that is another story that I don't have time to write down.)


I am STILL doing the alternate days of hate at Zombies, Inc; I feel great one day, totally cool with flinging all my social energy into a brick wall, enjoying the flow of things, then the next day I just can't even pick up the telephone. I keep trying to push myself a bit harder there regarding the things I find hard. My real problem lately is that I'm now on the same level positionwise as the Cyborg and I even have my own intern now, but The Cyborg is, like, a machine. He has become one with the data. I am struggling to stay ahead of his interns. I think he makes more than me, but not MUCH more, and it is completely unreasonable to pay me anything like what he makes because for the love of god I am pretty sure this company could make money if it consisted of only the Cyborg making the product and My Friend selling it and My Friend at least makes commission. I have never been not good at a job before, but as I try more and stupider things I should probably adjust to this feeling.


Hey, have another link about jobs getting shittier.
thene: PROTIP do not fuck with Minette (minette)
So, there's this guy. We'll call him Asshole.

Asshole worked for a well-known private equity firm. In addition to the wages he received for working there, he was also a partner in two of the firm's investment partnerships, and received pass-through income from these partnerships (more on this later). Asshole quit his job last summer and started an MBA course.

Asshole earns too much to qualify for any of the education tax credits; those credits are awarded to low or middle-income people who put themselves, or their children, through education programs in order to have better lives in the future, and therefore they phase out at something like $100,000 of income /too lazy to look it up. However, Asshole is undeterred. He's going to deduct all his MBA tuition as an unreimbursed employee expense.

Is this legal? Well, that depends. This is what the code says you can deduct:

If the education--

(1) Maintains or improves skills required by the individual in his employment or other trade or business, or

(2) Meets the express requirements of the individual's employer, or the requirements of applicable law or regulations, imposed as a condition to the retention by the individual of an established employment relationship, status, or rate of compensation.


There's certainly types of education that qualify. A few days ago, I deducted a young City of Boston teacher's tuition as an employee expense because it was the best option available to her and her employer (the school system) requires that she get a Master's degree within 5 years in order to keep her job. But MBAs? This has been the subject of multiple court cases, and a lot depends on circumstance, such as whether or not you can prove you were established in a trade or business before quitting your job to do an MBA.

So Asshole presents Mr Slime with a 1098-T that states the total amount he paid to Swank Business School. Foolishly, he also hands over his student account transcript and I notice that almost everything on it is not tuition - no, Asshole, you cannot deduct your health insurance as an employee expense just because you paid it via the school, much less your fucking cable bill what the hell. So I let him deduct the part that was actually tuition paid in 2013 and move on to his partnership income statements.

(Why do private equity funds and venture capital funds operate as partnerships? Because partnerships are not like corporations. With corporations, if you buy stock that costs an amount of money equal to 5% of the company's value, you own 5% of the company, and while there are different classes of stock and yours may not confer voting rights etc, you are gonna get your 5% share of the company's dividends. Partnerships, however, can be rigged however you want. Typically, the people who set up a PE or VC fund put down just slightly over $0.00 and are entitled to 20% of the fund's profits. This is why they are so good at wasting money on shitty things that fail - it's not their money, it's other people's money.)

Partnerships do not pay taxes. (Neither do most small corporations, termed S-Corps). Instead, they pass their income through to the partners, and each partner reports their allocated share of the partnership's profits on their own individual tax returns. The partnership income statements that Asshole turned in each contained a boilerplate statement that the partnership existed to passively make investments on behalf of its members, and that all of each fund's income was therefore investment income (taxed at a top rate of 20%) rather than ordinary income derived from work (taxed at a top rate of 39.6%). Such protestations have, recently, been the source of unending but unproductive wank as they are one of the major reasons that Mitt Romney pays less taxes than you. The PE fund is pretending it does...nothing! It does not manage companies, it does not provide any work in order to generate its income. It just sits back and money just magically happens, like. (Again, this can be completely legit - eg. real estate partnerships that collect rent while only occasionally having to lift a finger to repair something or find a new tenant, or partnerships that make long-term stock investments and don't do much trading).

You see how this applies to Asshole?

Yes, Asshole just made a deduction to his income of almost $20,000 of college tuition in order to 'Maintain or improve skills required by the individual in his employment' which his employers, and he, are simultaneously claiming is not even a real job.

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thene: Happy Ponyo looking up from the seabed (Default)
thene

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