Almost half of Americans pay nothing on Tax Day

Tax Day is upon us on April 18, 2011. A lot of people dutifully fulfill their obligations to the government concerning their taxes. Income taxes are not parted with gleefully. However, the legal obligation to file a tax return isn’t diminished by resenting it. Tax Day is certainly resented by the individuals who have to write the government a check on tax day, but the nearly 50 percent who don’t might be fine with it. Post resource – Tax day – Nearly half of Americans owe nothing by MoneyBlogNewz.

Little over half of Americans pay taxes on income

Tax Day 2011 falls on April 18 instead of April 15. This year nearly 45 percent of households will not have to pay any taxes on their 2010 income, according to Bloomberg. Low-income households receive exemptions and deductions, for instance the Earned Income Credit and the Making Work Pay Credit. Anyone that makes hardly any money or lives on fixed incomes such as disability or Social Security won’t pay any income taxes. If you don’t make much and have kids, you most likely will not pay taxes either. This is generally the case. The average tax refund, according to CNN, was $3,003 last year.

Wealthy paying less

Daily Finance states that there has been a decrease for everyone in taxes. Even the wealthy have been paying less. In 2007, 17 percent of income was paid by 300 highest income returns which were 26 percent in 1992. The wealthiest 5 percent account for 44 percent of the nation’s tax revenue while the top 10 percent is more than half of it. The tax breaks for the rich are becoming more readily available as well. Each year, $8,000 could be given to every taxpayer with the over $1 trillion in tax breaks in the U.S. tax code. It is a bad idea to try and trick the Internal Revenue Service though. USA Today states that now, there are more charges than ever the IRS wants to put out.

Developed countries typically pay more in taxes than Americans

In the United States, most people like to avoid and protest paying taxes. Nevertheless, as MSNBC points out, Americans pay less in taxes than the rest of the developed world does. Taxes are reviewed by the OECD, or Organization for Economic Co-operation and Development. This group keeps developed world tax information maintained. In The United States, a 24 percent tax on income is common while it is at 27 percent in Australia, 37 percent in Germany, 42 percent in France and 48 percent in Danes, states the OECD.

Citations

Bloomberg

bloomberg.com/news/2011-04-18/nonpayers-complicate-republican-effort-at-overhaul-of-u-s-tax-code.html

CNN

money.cnn.com/2011/01/14/pf/taxes/tax_refund/index.htm

Daily Finance

dailyfinance.com/2011/04/18/super-rich-see-federal-taxes-drop-dramatically/

USA Today

usatoday.com/money/perfi/taxes/2011-04-17-Prosecutions-of-tax-evaders-up.htm

MSNBC

msnbc.msn.com/id/42612937/ns/business-tax_tactics

Money hoarding Japanese victimized by natural disaster

While thousands of Japanese homes were destroyed in the earthquake and tsunami, the metal safes in some of them are turning up in the rubble. Japanese police have been storing the safes and accepting money discovered in bags, boxes and furniture turned in by honest citizens. The drawbacks to hoarding money at home have been made clear as a great deal of the lost money might be extremely hard to return.

Metal safes intact among the devastation

A month after the Japan earthquake and tsunami, cleanup workers and residents looking through the wreckage of the ravaged northeast coast are finding tens of millions of yen in money and countless safes. All of the safes are being stored. Police have them. There have been hundreds of safes in Ofunato put in the parking garage where automobiles are no longer welcome according to the AP. There may have been over 25,000 deaths from the tsunami. All of the cash might go unclaimed. The safes may no longer belong to anyone. Police have to wait 90 days while storing the valuables according to Japanese law. Any person who finds it gets to keep the unclaimed money if nobody claims it. The government gets the money if nobody claims it.

Those in Japan hiding money

All of the money could be helpful. The Japanese government might appreciate it. Paying for earthquake and tsunami damages won’t be cheap. The estimate is at $309 billion already. The estimate contains losses due to wiped out homes, buildings and infrastructure, however not the stashes of cash stored in your house in safes and other hiding places. Many in Japan would keep cash in your house, since several didn’t feel comfortable with banks. According to Japan’s central financial institution, more than a 3rd of 10,000-yen bills that are printed do not circulate — about 30 trillion yen — about $354 billion at the current exchange rate. Cash has been stashed in furniture, boxes and safes by older Japanese individuals. The idea of a savings account is inconvenient since there have been very low rates of interest.

What’s in the safes?

As of April 11, there have been over 13,000 fatalities confirmed from the tsunami on Japan’s coast while there are still 14,377 missing right now. Recovered safes and cash are expected to continue piling up. For owners of the safes, claiming them might be as simple as opening them. Claiming cash may not be as simple. It would be hard to figure out. Kesennuma was one of the worst hit towns by the tsunami. Only 10 to 15 percent of its valuables found were returned so far. Authorities may try opening safes to see what’s inside them as there is no space to store them.

Information from

Associated Press

news.yahoo.com/s/ap/20110411/ap_on_bi_ge/as_japan_earthquake_lost_money

The Telegraph

telegraph.co.uk/news/worldnews/asia/japan/8443301/Japan-earthquake-police-handed-tens-of-millions-of-yen-from-devastated-area.html

Seattle P.I.

seattlepi.com/news/article/Debris-challenges-pile-up-in-Japan-1-month-later-1331227.php

Epsilon database hack exposes millions to phishing attacks

The email industry messaging firm Epsilon was hacked by hackers hacking its database. Millions of consumer names and emails were stolen. The Epsilon database contains millions of customers of banks with credit cards, also as those of big retailers. Epsilon clients commenced alerting their customers about phishing attacks that may result due to the data security breach.

In the Epsilon database: Better watch out

The Epsilon database hack may be the biggest in history of a hack while millions of names and emails were stolen. Every year, about 40 billion marketing emails are sent out for 2,500 corporations by Epsilon. The company announced that it was hacked on Friday, meaning emails and other information given to sites might have been stolen.

This hurt at least a dozen companies. Banks were impacted by this including J.P. Morgan Chase, Citigroup, U.S. Bancorp, Barclays Bank and Capital One. Customers need to look for phishing scams in the future. Watch out when you have been at other businesses as well. These will include Kroger, Walgreens, TiVo, Best Buy and HSN. Students should worry as about 5,900 colleges and universities were in the College Board database, the company that organizes the SAT. This information may also have been stolen.

How to spot a phishing con

Spam is more than likely the goal of all the emails and names stolen out of the Epsilon database. The "phishing scam" might be very effective this time. This is because people with actual accounts and information will be targeted. The phishing email tries to trick them into logging in at a fraudulent site created to look like the real site, which captures the login information and gives hackers access to the account. The email could be more convincing after having hackers' name and email in order to go on Facebook and find more personal details. Phishing scams often ask consumers to update charge card information or urgently warn that if a response isn’t received the account will be closed. Because the account is compromised, phishing scams will ask for account information.

Criminal making history

The number of students and consumers exposed to the database hacks has yet to be made clear by Epsilon, although it was clear that it was limited. Epsilon clients already mentioned weren't the only ones at risk. AstraZeneca, Kraft Foods, Hilton Hotels and Verizon Communications might also be at risk. Internet security analysts believe the Epsilon database hack might surpass the Heartland Payment Systems hack, currently recognized as the biggest identity-theft incident in U.S. history. Notorious cyber-criminal Albert Gonzalez was sentenced to 20 years in prison after being convicted of leading a ring of hackers that broke into Heartland Payment Systems and stole more than 40 million payment card numbers.

Information from

Associated Press

finance.yahoo.com/news/Banks-creditcard-issuers-warn-apf-754015157.html?x=0&sec=topStories&pos=main&asset=&ccode=

MSN Money

money.msn.com/identity-theft/news.aspx?feed=OBR&date=20110403&id=13261200

Computer world

computerworld.com/s/article/print/9215443/Update_Bank_customers_warned_after_breach_at_Epsilon_marketing_firm?taxonomyName=Security&taxonomyId=17

Microsoft

microsoft.com/security/online-privacy/phishing-symptoms.aspx

Economic recovery is leaving the construction industry behind

In the last quarter the economy has been recovering without construction spending, which continues to fall. Construction spending hit a twelve-year low in February as that industry of the economy continued to weaken. New home construction, dragged down by foreclosures and short sales, was even worse, dropping to the lowest level in recorded history.

February as a bad month for construction

Builders broke ground on fewer homes, apartments and government projects in February than they have in more than a decade. In February, the construction spending went down about 1.4 percent. That was the third month that it has gone down. The seasonally adjusted annual rate of construction spending in February hit $760.8 billion, the weakest level since October of 1999. The U.S. economy appears to be getting a little bit better right now. At the same time, the construction industry is going down. There are fewer corporations wanting to build office buildings, hotels and shopping centers still even though the recession is over. Nevertheless, the construction market has to deal with this. February construction activity fell to about half the $1.5 trillion level economists figure is needed for a healthy construction market. The housing bubble that brought on the recession will not recover for four more years, according to estimation.

New home construction burst along with housing bubble

Private residential construction fell 3.7 percent in February to an annualized rate of $228.5 billion. construction of single-family and multi-family homes also went down. This was because foreclosures and unsold homes are still high. Until housing inventory could be cleared, new home construction will continue to languish. There was a 3 percent drop in existing home sales past year with a 28 percent drop in new home sales, reports the National Association of Realtors. The government started keeping track of levels in 1963. Since then, the biggest drop was in February, 2011, with a 16.9 percent decrease in an annual rate from 301,000 to 250,000.

Not a soul to build or purchase new homes

The Gross Domestic Product bottom line is driven by new home sales in construction. It costs 29 percent more for a new home than an existing home currently. The National Association of Realtors states this is twice what is considered normal. About 4 percent of February home sales were foreclosures and short sales, which is hurting the industry. The foreclosures need to end while the inventory of new homes needs to go down. Until this occurs, home builders will stop building homes. Financing was needed by 80 percent of builders before the recession. In accordance with the National Association of Home Builders, only 20 percent now are looking for construction loans.

Information from

Associated Press

finance.yahoo.com/news/February-construction-apf-1467794995.html?x=0&sec=topStories&pos=8&asset=&ccode=

Market Watch

marketwatch.com/story/buyers-shun-new-homes-1301521568482

CNN Money

money.cnn.com/2011/03/23/real_estate/new_home_sales/index.htm

refund anticipation loans might disappear in foreseeable future

Credit goods are falling under an increasing amount of scrutiny. One such product is refund anticipation loans. Banks are under increasing regulatory pressure from the government not to fund the loans, which makes it harder for companies that offer them to secure the credit. Advocacy organizations believe that refund loans are detrimental to people who take them out. Article resource – Refund anticipation loans could become endangered species by MoneyBlogNewz.

Financing harder for tax preparers

Tax preparation services for instance H&R Block and Jackson Hewitt are finding it harder to discover financing for tax refund loan programs, as federal regulations make it more difficult for financial institutions to meet legal underwriting requirements. H&R Block was forced to close its refund anticipation loan program when its partner in financing the program, HSBC, was forced to withdraw from the partnership in the program by the Office of the Comptroller of the Currency, according to the Washington Post. H&R Block posted a net loss in excess of $12 million in the three-month period that ended January 31, and that partially was as a result of loss of the product, according to NPR. JP Morgan Chase stopped financing the short term installment loans against tax refunds in April of 2010.

Change in Internal Revenue Service rule brings loan product to a halt

If an individual took out a refund anticipation loan, the business that the loan came from was able to check the person's tax refund status which was from the Internal Revenue Service. That law was repealed past year, and the belief that a financial institution might not check on the borrower’s credit worthiness meant that legally mandated underwriting needs can’t be met. The RALs were only offered by the Ohio Valley Bank in Gallipolis Ohio and River City Bank and Republic Bank and Trust banks in Louisville, Ky., this year. At the conclusion of this tax season, both River City Bank and Ohio Valley Bank are preparing on leaving the market. That means that there can be only one bank that offers them in the whole nation soon.

Refund anticipation loan facts

There are several that like refund anticipation loans. They are simple loans. Individuals get their taxes prepared by a preparation service like H&R Block or Jackson-Hewitt. If they are due an income tax refund, they can take out loans against their refunds. The refund minus a $65 fee, or somewhere around there, is taken out. This is what the refund anticipation loan is. The loans are somewhat similar to payday loans, as the loan is against future earnings. No credit check is done, just like payday loans. There are still fees and penalties. There’s a lot of criticism for these. This is because they service mostly low-income communities. It can be hard for individuals to wait for the money. Most that get the loans need the money right away.

Articles cited

NPR

npr.org/templates/story/story.php?storyId=134403451

Washington Post

washingtonpost.com/capital_business/2011/03/25/AFNQJVkB_story.html

Discrimination lawsuit against Wal-Mart may not go class action

Wal-Mart is defending itself in a huge discrimination suit that could cost the retailer billions. The Supreme Court heard arguments from both sides in the largest workplace discrimination suit ever filed. Whether the suit is considered a class action or not is the task at hand for the Supreme Court, which seemed to doubt whether that would be necessary. Article source – Justices doubt Wal-Mart discrimination suit warrants class action by MoneyBlogNewz.

Anything might change with Wal-Mart suit

There are many that know the Wal-Mart sex discrimination suit could change things. It wills likely end up at the Supreme Court due to its idea of Corporation rights versus workers rights. The ruling could impact virtually every private employer in the U.S. There were fewer chances of promotion and less payment given to former and current 1.6 million Wal-Mart employees, according to the lawsuit. The plaintiffs are demanding back pay and punitive damages. Last year a trial court and the U.S. Court of Appeals in San Francisco allowed the case to proceed in a combined, multiparty lawsuit in one trial. The Supreme Court must choose whether all the women who worked for Wal-Mart since 1998 can indeed sue together in a class action.

Chance of Wal-Mart losing quite a bit with lawsuit

The Wal-Mart liability would go up easily in the sex discrimination suit. This would be the case if it became a class-action suit. A ruling towards Wal-Mart would put intense pressure on the business to settle claims out of court. Wal-Mart would win effortlessly if the justice sides with it. This is since the individual lawsuits will not work nearly as well as one giant lawsuit. The sex discrimination lawsuit towards Wal-Mart could change the business world. This has brought on major U.S. corporations and employee advocates to follow it very closely. If the plaintiffs win, disgruntled workers might swamp the courts with a flood of worker discrimination lawsuits. Corporations would be relieved if Wal-Mart were to win this one.

Reaction to suit

During arguments over the Wal-Mart sex discrimination suit Tues, the Supreme Court questioned whether systematic discrimination took place. The plaintiffs' lawyer explained that women are affected by stereotypes due to the corporate culture. About 3,400 Wal-Mart and Sam's Club stores in the United States had this problem, he said. The comment Wal-Mart said explained that it is not legal to do a class-action suit for all female employees considering there have only been discrimination instances in some stores by some managers. There has been discretion in managers choosing the payment of the men and women working at Wal-Mart. A systematic discrimination would be extremely hard in this instance. It will not be long before a decision is made. It is anticipated to occur in June.

Citations

Los Angeles Times

latimes.com/news/sc-dc-walmart-discrimination-20110329,0,3119421.story

CNN

cnn.com/2011/US/03/29/scotus.wal.mart/index.html?npt=NP1

Associated Press

google.com/hostednews/ap/article/ALeqM5gbOXzrZv6IDB2xzX5jdDJegcXkug?docId=879cbb4c18b44a338291cb69015c93db

A $53.4 million boost to small businesses

Three states have qualified to get big money from the Treasury Department. Connecticut, Vermont, and Missouri are slated to receive an infusion of cash. The Treasury Department has authorized $53.4 million worth of lending money for those states. The cash that is available is meant to create more investment. Specifically, states had to show that their programs would create $10 worth of lending for every $1 of investment. Resource for this article – Treasury kicks off small business lending with $53.4 million by MoneyBlogNewz.

The Small Business Jobs Act

Smaller businesses accounted for about 65 percent of new jobs in the last 15 years. At the exact same time, about 50 percent of jobs in the U.S. in the private sector come from small businesses total. In order to encourage small business growth and hiring in the U.S., Congress passed the Small Business Jobs Act in 2010. States with plans to use investment in loan guarantees and programs like it to help small businesses were given $1.5 billion in loan guarantees by the Treasury through the Act.

Plans to invest in Connecticut $13.3 million

Companies are able to get insurance loans in Connecticut because of the Treasury department funds. One essential part of this is to get investment portfolios from a financial group. The group picked, the Connecticut Development Authority, can be getting $13.3 million for this. The CDA funds can be given to nineteen financial institutions so the small business loans could be handed out.

Small businesses get $13.2 million in Vermont

The Treasury only needs to give Vermont $13.2 million for its plan. It plans on getting $132 million in small business lending from that. Four programs will each get a share of the business loans, which are similar to bad credit unsecured loans not payday loans. And $3.3 million will go to the Small Business Loan Program, which provides loans that support purchase of fixed assets (such as equipment) for businesses. About $3 million will go to the Technology Loan Participation program. The IT And Bioscience businesses could be increased in theory. About $1 million will go to portfolio insurance to lend. Another $5.9 million will go to building in Vermont with the Commercial Loan Participation Program.

Investment in Missouri closer to $26.9 million

Missouri qualified for the largest loan guarantee of the three states, at close to $27 million. There could be two funds for the money to go into. Companies with less than 500 employees get help from the Grow Missouri Loan Participation Fund. About $10 million will go to that fund. About $3 million could be given to the Loan Participation Fund. This will help grow many of the state businesses. About $16.9 million is left to be used by new businesses. This is so high-tech businesses can get help with start up costs.

Articles cited

CNN

money.cnn.com/2011/03/22/smallbusiness/state_small_business_credit_initiative/index.htm

Small Business Administration

sba.gov/advocacy/7495/8420