TaxCoach Briefs:    June 12, 2008

Volume 3, Number 24

*****Attention All-Stars*****. The June 10 Teleseminar is now available on the TaxCoach All-Stars page in the red "Resource Center." Those of you who missed the call missed a great roundtable discussion on scheduling client appointments and managing client paperwork during "the season," managing staff workflow throughout the year, and even collecting fees for completed work. We'll be including these roundtable discussions in most of our calls going forward; don't miss your chance to get your questions answered!

TaxCoach Briefs archives.

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MARKETING MINUTE (EAL)
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THRILLA IN MANILA?

The 2008 presidential election promises to be a spirited campaign. Now that the Democrats have voted Hillary off the island, we can watch Barack Obama and John McCain explore their differing visions for America in a dignified, intellectual manner, reminiscent of the famed "Lincoln-Douglas" debates that set such a responsible tone for presidential politicking. Unless, of course, the campaign consultants have their way, in which case we can expect a slugfest that makes the "Thrilla in Manila" look like a local school board race.

I'm looking forward to seeing each candidate's Vice-Presidential pick. Obama should probably look to someone older and more conservative, with a military background -- in other words, John McCain!

Your clients will soon start asking you what they can expect from each candidate's tax proposals. So we've prepared a customizeable chart outlining each of their main proposals in the areas of income taxes, employment taxes, estate taxes, and healthcare financing. We've also prepared a Client Alert for use delivering the comparison to your clients.

You'll find McCain's proposals, for the most part, to be what you'd expect from a reputed "maverick" Republican looking to shore up support with his party's base. Make the Bush tax cuts permanent. Require a 3/5 Congressional majority to raise taxes. Cap the estate tax at 15% and apply it only to estates topping $10,000,000. But McCain also proposes to eliminate the deduction for employer-provided health insurance (currently a $90.6 billion annual tax preference) and replace it with a credit of $2,500/person and $5,000/family for health insurance premiums. (This would likely eliminate the deduction for Medical Expense Reimbursement Plan benefits that are so popular with TaxCoach subscribers!)

Similarly, Obama's proposals are mostly what you'd expect from a progressive Democrat. Keep the "best" part of the Bush tax cuts benefiting married couples, families with children, and small businesses. Restore the 36% and 39.6% marginal rates on the highest earners, and raise the capital gains rate back to 20% or even 28%. Establish new, refundable tax credits for students and homeowners who don't itemize. But Obama's plan includes a wild card too -- specifically, eliminating the current $102,000 "wage base" on income subject to Social Security (and self-employment) tax.

Of course, merely proposing a specific change doesn’t mean we'll actually see it become law. (For those of you needing a refresher, click here to review how a bill becomes a law.) If McCain wins, he’ll likely face a Democrat-controlled Congress, which would greet his proposals skeptically. If Obama wins, he’s unlikely to enjoy veto-proof majorities in either house.

Your clients will have all sorts of places where they can find this information. But shouldn't they hear it from you? Let them know now, before the campaign heats up, that you're keeping an eye out for them, evaluating the candidates' proposals and anticipating their potential effects.

Make sure you distinguish between politics and policy, so you don't intimidate or offend anyone. But make sure not to miss this opportunity to reinforce your value. Do it right, and your clients will reinforce their value to you!

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NEW TOOL (EAL)
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CAMPAIGN 2008 TAX PROPOSAL COMPARISON

As I mentioned above, we've prepared a chart comparing the McCain and Obama tax proposals for you to ciustomize and use with your clients. You'll find it in the TaxCoach Playbook, under "Sample Letters in Microsoft Word."

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CLIENT ALERT (EAL)
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CAMPAIGN 2008 TAX PROPOSALS

Also, as I mentioned above, we've prepared a Client Alert to accompany the Campaign 2008 comparison I discussed in the first article.

When you click on the 'Client Alerts' button in TaxCoach, you'll see a list of alerts, with this latest on top. The file 'campaign08.doc' contains letters addressed to each of your clients with TaxCoach records.

You can download the file to your system, and print on your letterhead using MS Word, or any word processor which supports Rich Text Format ('RTF'). You'll find instructions on the Client Alerts page.

As always, whether or not your clients will be materially affected by these changes, hearing the news from you reinforces the value of your service and your relationship. Feel free to call us if you have questions.

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TAXCOACH "SPRING TRAINING" (KAV)
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BOOT CAMP FINAL UPDATE

Ed and I have gone from spending "more and more" of our time to spending "most" of our time preparing for the upcoming TaxCoach "Spring Training 2008." (Expect a brief Briefs next week, as we'll be spending "all" of our time with last-minute tasks and details!) We've begun gathering speakers' presentations for inclusion in the curriculum binder, gotten dates for receiving "swag" for attendees, and made reservations for the Saturday night All-Stars banquet just off downtown Cincinnati's signature Fountain Square.

There's still space in our larger meeting room for last-minute reservations. And we've added a last-minute incentive for those of you within driving distance. If you haven't yet registered, and you're within driving distance of Cincinnati, we'll buy your first tank of gas! The $72 discount will cover 18 gallons (sorry if you're driving a Hummer!).

Subscribers, you should have received two mailed invitations, one in late March and one with your first TaxCoach Lineup. If you're not a subscriber, or you don't have a copy handy, click here to learn more about the Boot Camp.

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MEMBERSHIP OPPORTUNITY (KAV)
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BEAT THE JULY 1 PRICE INCREASE

Since we launched TaxCoach, all the way back in May 2005, we've worked with hundreds of you across the country. We've added new modules, new tax tools, new marketing materials -- most recently, a mailed monthly newsletter, the TaxCoach Lineup. We've proven the concept of planning-based marketing. We've grown from the industry's only "plain-English tax-planning software" into a true business development system. And we've created a national community with our All-Stars Mastermind Group and upcoming "Spring Training 2008" Boot Camp.

Adding benefits necessarily involves adding costs, such as additional staff, equipment, and printing and postage costs. In order to continue the level of service that a comprehensive personal coaching, business development, and planning software system like TaxCoach deserves, our subscription rates will be going up marginally.

Several of our own marketing advisors have urged us to raise the rate all the way to $99/month. (In fact, a couple of them actually laughed at us when they learned how little we charge for everything included in your subscription.) We certainly think TaxCoach is worth it. But for now, we'd rather "build our base" and expose as many of you as we can to our proactive approach. So, effective July 1, 2008, the new rate will be $69 per month.

But you can still keep the current price -- and get nearly four months free -- by switching to annual "MVP" membership.

The annual rate is always a good deal, getting you 12 months for the price of 10. That's still true at the new rate of $690 which starts July 1. But, if you upgrade to "MVP" membership by June 30, you'll still get the current rate of $590 -- which means that right now, you'll get the next 12 months of TaxCoach for just a little over the price of 8. That's almost 30% off the monthly rate!

If you're already an annual subscriber, you'll get the discounted $590 rate automatically with your next renewal for the remainder of the year. "MVP" means we take care of our best subscribers!

Interested? Call us at 513-321-2820, or email support@taxcoachsoftware.com. We'll contact you to set up the details.

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SUBSCRIBER Q & A (KAV)
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Last week, we outlined tax strategies for hiring children in family businesses. We received several responses like the one printed below:

Q: I have seen in your newsletter that you are talking about paying kids as young as 7. Any thoughts on Dept of Labor that says that kids can't work until age 14 without a work permit?

A: You ask a good question about the intersection between IRS rules for hiring children and federal, state, and local labor laws.

In most cases where a parent hires a child to work in an unincorporated business (other than a farm), parental rights trump labor laws so long as parents aren't hiring their child for hazardous activity.

Traditional age laws may or may not apply, depending on the state, where a parent’s corporation hires a child – again, so long as the child is not engaged in hazardous activity. (Tony Soprano likes to consider himself a "good" father, so he would never hire his son AJ to whack a rival from the Lupertazzi family. But New Jersey authorities would probably still frown on using AJ for routine administrative tasks like collecting "juice" on dad's "shy," whether Tony's incorporated or not!)

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We're happy to answer your questions on TaxCoach content, features, marketing, or general taxation. While we give first priority to our TaxCoach All-Stars, we work to answer all questions. For best response, email support@taxcoachsoftware.com. If we can't answer immediately, or we think the answer will be useful to all of our subscribers, we'll publish it (anonymously) here in the 'Subscriber Q & A' section of TaxCoach Briefs.

Regards,

Ed Lyon
Keith VandeStadt

www.taxcoachsoftware.com
(513) 321-2820

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