My chronicle of how the IRS and Tax Court affect taxpayers' daily lives.

See below for important disclosures.

Tuesday, November 3, 2009

A break in the update series for financial news ....

I've previously mentioned Lee Eisenburg of Able Financial Group and how he sends me great e-mails which have interesting information "By The Number$."  Interesting facts today include:

TAX STATS - In 1980, the top 1% of US taxpayers earned at least $81,000 in adjusted gross income (AGI), accounted for 8% of all AGI nationwide and paid 19% of all federal income tax. In 2007 (the most recent year for which data is available), the top 1% of US taxpayers earned at least $410,000 in AGI, accounted for 23% of all AGI nationwide and paid 40% of all federal income tax (source: Internal Revenue Service).

OBAMA’S STOCK MARKET - Since Barack Obama was elected President of the United States on 11/04/08 (i.e., 1 year ago this upcoming Wednesday), the S&P 500 has been up +10.1% (total return) through the close of trading last Friday night. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the US stock market (source: BTN Research).

ONE DAY - The best 1-day performance for the S&P 500 since Barack Obama was elected President on 11/04/08 took place on Monday 3/23/09 when the stock index gained +7.1% (total return) in just 6 ½ hours of trading (source: BTN Research).

SEVEN, NOT EIGHT - The S&P 500’s streak of 7 consecutive up-months (on a total return basis) ended last Friday. The stock index lost 1.8% in October but has still gained +43.1% over the last 8 months (source: BTN Research).

FOR A NUMBER OF REASONS - 30% of Americans age 45-64 surveyed in late July 2009 have stopped contributing to a pre-tax retirement plan (source: AARP).

WAY UP - The average nationwide price of gasoline has increased $1.08 a gallon YTD to $2.70 as of last Friday while the price of oil has increased $32.89 a barrel YTD to $77.49 (source: AAA, NY Mercantile).

BIG BUCKS FOR THE SIXTH GRADER - The average cost for 1-year of college education at an in-state public college is $15,213 for the 2009-10 school year (including tuition, fees, room and board). The total 1-year cost has increased +6.5% per year over the last 30 years. If that same annual rate of inflation continues into the future, then a 6th grader today will ultimately pay $104,000 for his/her 4-years of education at an in-state public college during the years 2016-20 (source: College Board).
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Aaron Blau, E.A. is the Vice President of the Central Arizona Chapter of Enrolled Agents and a member of the Government Relations Committee of the National Association of Enrolled Agents. The opinions and ideas expressed here are in no way representative of the official position of the National Association of Enrolled Agents, Arizona Society of Enrolled Agents or the Central Arizona Chapter of Enrolled Agents.

For official comments, please e-mail NAEA Director of Communications at mlockwood@naea.org or Arizona Society president stefaniecampbell@aztaxpros.org.

IRS CIRCULAR 230 DISCLOSURE:
"To ensure compliance with the requirements imposed by the IRS, we inform you that, to the extent this communication (or any attachment) addresses any tax matter, it was not written to be (and may not be) relied upon to (i) avoid tax-related penalties imposed under the Internal Revenue Code, or (ii) promote, market or recommend to another party any transaction or matter addressed herein (or in any such attachment). In addition, nothing herein is intended to convey an expression of an opinion as to the likelihood a tax position would ultimately prevail if challenged by the IRS. This communication is intended solely for the person to whom it is addressed; no one else should rely on the tax advice provided herein. The person to whom this advice is addressed is under no obligation to keep the advice or matters related to the advice confidential."