Why Fears Of A ‘Government Crackdown’ On Bitcoin Are Overrated

A consistent thread about bitcoin has been that if it succeeds, it will inevitably invite government legislation and regulation to shut it down. This has been a backhanded critique of sorts advanced by investors like Ray Dalio who are “on bitcoin’s side”, but worry about its success attracting the attention of the state powers that be.

This isn’t an altogether surprising or irrational fear. We live centuries after the establishment of the nation-state as all-powerful welfare state, military, and taxation hub. It’s clear that state powers are often only reined in by “political” constraints (rather than physical or technical ones). Could governments shut down bitcoin if they wanted to?

This is probably a lot harder than one might think. Bitcoin is somewhat resilient to government crackdowns because of its origin, and the way the network is built. While states, if focused enough, could probably inflict some damage to bitcoin if it was a central state objective across the board, there are many factors for why a “government crackdown” on bitcoin is overrated for destroying the network.

1- It requires large-scale coordination among many different multilateral bodies and states

Since bitcoin is internationalized, it would require consent and coordination among almost every nation-state in order to effectively crack down on bitcoin. While the major world powers (such as the United States and China) have a bloc-like effect, and whereas there has been more coordination (often US-led) on issues such as climate change and corporate tax rates, when you look at issues as diverse as COVID-19 and the tit-for-tats of “strategic rivals” and Olympic boycotts — it is still difficult to see countries focusing on bitcoin in unison.

Large-scale coordination would be required to shut down the network in any meaningful way: otherwise, people could transact and support the bitcoin network in other nations or even in space. A slow nation-by-nation ban can affect the network: at an extreme, an unlikely state-led ban in the United States might choke off bitcoin from American-led financial systems and markets with near-total global reach. Yet, so long as bitcoin was trans-actable across other states, a “global ban” could not be accomplished nor a “government crackdown”.

2- There is no central node that states can really pressure

One of the most unique points about bitcoin is that there is no central leader figure to pin down. Satoshi’s disappearance, and Hal Finney’s untimely death, have led to a situation where there isn’t a “company CEO” or some other central leader to go after. While there are pressure points nation-states can use to pursue their objectives (for example, physical concentration of miners, key technical contributors still constrained by borders), there isn’t a central one, but rather a set of diffused ones.

We saw this when the Chinese state banned bitcoin mining in its territory: did that spell the end of bitcoin? No: miners simply shifted their equipment elsewhere, and within a few months, hash rate was as high if not higher than what it was before.

States are not used to dealing with organizations like this: they are used to dealing with multinational corporations to a certain extent, but there are usually a set of central pressure points and leadership that a state can lean on to get that corporation to adhere to certain rules and regulations. That, due to bitcoin’s unique creation story, is very unlikely to happen with any attacks on the bitcoin network.

3- Code is speech

In the United States, code is regarded as “protected” speech — software source code which powers bitcoin is protected by the First Amendment. In order to attack the distribution of code that powers bitcoin, countries like the United States would have to fundamentally change themselves and subvert long-held covenants of limited powers and the rule of law. This is not impossible (bitcoin, over a decades and even centuries long time horizon is a bet that (some) technical constraints are better than purely political ones for maintaining rule of law) but would be very out of character, and probably politically untenable.

4- States can be induced by bitcoin for commercial and other reasons

The Internet may never have been encrypted at all — export controls were initially placed on encryption, and commercial uses were seen skeptically. However, states partially relented when the commercial possibility of the Internet became clear. Now encryption powers communications as well as online banking and e-commerce sales.

This is not something states like: the Five Eyes and allied countries want to subvert end-to-end encryption and authoritarian states like the Chinese state either have backdoors or other mechanisms to promote social control. Yet it shows that, when faced with something that might threaten national security, the need for states to show GDP outcomes and to deliver wealth to their peoples might override their preferences in other areas.

As more and more countries adapt bitcoin in some fashion, this pressure will become larger until perhaps one day, we might see a bitcoin-friendly bloc of nations emerge similar to the Cairns Group for agriculture. Some will find that their domestic power-generation is more efficiently parsed through open-source bitcoin rather than supporting the fractional reserves of other countries. The more states are turned over to supporting the bitcoin network, the harder it will be for other states to attack it.

5- Bitcoin’s threat model has long included state-level powers

The way bitcoin is implemented makes it (more) prohibitive for any centralized collection of computers to disrupt the system. With more than 170,000 PH/s of hash rate securing the system (as of the date of writing) from a coordinated 51% attack (where an attacker could take over the system and propogate invalid spends in order to down the system for legitimate users, or to benefit monetarily from it), a projected security budget of around $45-60mn a day, and enough stakeholders .

(From investors, code contributors, analytics firms, miners and businesses — and now governments — that accept bitcoin) who have placed their financial livelihoods on monitoring the chain such that bitcoin could be secure beyond its fundamental dynamics — bitcoin is large enough to warrant significant resources for any attack, resources that wouldn’t be available for just any nation-state, and which would have to be continually deployed in a way that would make it hard to obscure who the attacker was.

We live in a heady time where “magic Internet money” has suddenly become the concern of Clausewitz readers around the world. As bitcoin grows more prominent, the possibility that it attracts state powers to disrupt or fully coopt it grows — yet those who play some part in the network, either from investing, transacting or supporting its infrastructure, can rest assured that the system has some inherent properties that make it more resilient than you might expect to even the strongest of attacks.

Follow me on Twitter. Check out my website.

I was one of the first writers in 2014 to write about the intersection of cryptocurrencies in remittance payments and drug policy with VentureBeat and TechCrunch.

Source: Why Fears Of A ‘Government Crackdown’ On Bitcoin Are Overrated

.

More contents:

If You’re In Your 50s or 60s, Consider These Moves To Avoid Higher Taxes In Retirement

If you are working with an eye toward retirement or even semi-retirement, you are probably (hopefully) saving more than you could in the past in your retirement accounts. You may have paid off the mortgage and paid for college and other heavy expenses of raising children. That all sounds like you are on your way, except for one big problem I call the “ticking tax time bomb.”

I’m referring to the tax debt building up in your individual retirement account, 401(k) or other retirement savings plans. And, as I wrote in my newest book, “The New Retirement Savings Time Bomb,” it can quickly deplete the very savings you were relying on for your retirement years. But there are a few ways you can avoid this problem.

While you may be watching your savings balances grow from your continuing contributions and the rising stock market, a good chunk of that growth will go to Uncle Sam. That’s because most, if not all, of those retirement savings are tax-deferred, not tax-free.

The funds in most IRAs are pretax funds, meaning they have not yet been taxed. But they will be, when you reach in to spend them in retirement. That’s when you quickly realize how much of your savings you get to keep and how much will go to the government.

The amount going to the Internal Revenue Service will be based on what future tax rates are. And given our national debt and deficit levels, those tax rates could skyrocket, leaving you with less than you had planned on, just when you’ll need the money most.

So, that’s the dire warning. But you can change this potential outcome with proper planning and making changes in the way you save for retirement going forward.

You can begin by taking steps to pay down that tax debt at today’s low tax rates and begin building your retirement savings in tax-free vehicles like Roth IRAs or even permanent life insurance which can include cash value that builds and can be withdrawn tax-free in retirement.

In addition, if you are still working, you can change the way you are saving in your retirement plans. If you have a 401(k) at work, you could make contributions in a Roth 401(k) if the plan offers that. A Roth 401(k) lets your retirement savings grow 100% tax-free for the rest of your life and even pass to your beneficiaries tax-free too.

Learn more: All about the Roth IRA

What the News Means for You and Your Money

Understand how today’s business practices, market dynamics, tax policies and more impact you with real-time news and analysis from MarketWatch.

For 2021, you can contribute up to $26,000 (the standard $19,500 contribution limit plus a $6,500 catch-up contribution for people 50 and older). With some Roth 401(k) workplace plans, you might be able to put in even more.

Then, see if you can convert some of your existing 401(k) funds either to your Roth 401(k) or to a Roth IRA. Once you do this, you will owe taxes on the amount you convert. The conversion is permanent, so make sure you only convert what you can afford to pay tax on.

Also read: We have $1.6 million but most is locked in our 401(k) plans — how can we retire early without paying so much in taxes?

Don’t let the upfront tax bill deter you from moving your retirement funds from accounts that are forever taxed to accounts that are never taxed.

Similarly, you can convert your existing IRAs to Roth IRAs, lowering the tax debt on those funds as well. The point is to not be shortsighted and avoid doing this because you don’t want to pay the taxes now. That tax will have to be paid at some point, and likely at much higher future tax rates and on a larger account balance.

It’s best to get this process going now, maybe even with a plan to convert your 401(k) or IRA funds to Roth accounts over several years, converting small amounts each year to manage the tax bill.

If you have been contributing to a traditional IRA, stop making those contributions and instead start contributing to a Roth IRA. Anyone 50 or over can put in up to $7,000 a year ($6,000 plus a $1,000 catch-up contribution) and you can do so for a spouse even if that spouse is not working.

If one of you has enough earnings from a job or self-employment (and you don’t exceed the Roth IRA contribution income limits), each of you can contribute $7,000, totaling $14,000 in Roth IRA contributions each year. That will not only add up quickly, it will add up all in your favor because now you are accumulating retirement savings tax-free.

Related: Should you convert your IRA to a Roth if Biden’s infrastructure plan passes?

Once the funds are in a Roth IRA or other tax-free vehicles (like life insurance), those funds compound tax-free for you.

The secret is to pay taxes now. It’s so simple, but also so counterintuitive that most people don’t take advantage of this and end up paying heavy taxes in retirement that could have all been avoided.

Ed Slott is a Certified Public Accountant, an individual retirement account (IRA) distribution expert and author of “The New Retirement Savings Tax Bomb.” He is president and founder of Ed Slott and Company, providing advice and analysis about IRAs.

This article is reprinted by permission from NextAvenue.org, © 2021 Twin Cities Public Television, Inc. All rights reserved.

Source: If you’re in your 50s or 60s, consider these moves to avoid higher taxes in retirement – MarketWatch

.

More from Next Avenue:

Is a Roth IRA Right for You?

401(k) Early Withdrawals Have Become Easier: Be Careful!

Tips for Couples to Manage Their 401(k) Plans

I’m 49, my wife is 34, we have 4 kids and $2.3 million saved. I earn $300K a year but ‘lose a lot of sleep worrying about tomorrow’ — when can I retire?

‘Retirement? How?’ I’m 65, have nothing saved and am coming out of bankruptcy.

Got your COVID-19 vaccine? Now roll up your sleeve to protect yourself against these other diseases

Your 401(k) fees could cost you half a million dollars in retirement

Tax Refund Chart Can Help You Guess When You’ll Receive Your Money In 2021

Hear that? It’s the sound of millions of taxpayers cheering across the country: the Internal Revenue Service (IRS) has announced the open of the tax filing season. That date is February 12, 2021.

If you want to get your refund as fast as possible, the IRS recommends that you e-file your tax return and use direct deposit (be sure to double-check those account numbers before you send your return). If you file by paper, it will take longer. According to the IRS, eight out of 10 taxpayers get their refunds by using direct deposit.

Assuming no delays, here are my best guesses for expected tax refunds based on filing dates and information from the IRS. I can’t stress enough that these are simply educated guesses. I like math and charts as much as the next girl, but there are a number of factors that could affect your tax refund (keep reading)

PROMOTED Civic Nation BrandVoice | Paid Program The Role Of A Mentor Grads of Life BrandVoice | Paid Program How Reimagining Employment Practices Can Advance Racial Justice UNICEF USA BrandVoice | Paid Program UNICEF-Supported Vaccinators Won’t Stop Until They Eradicate Polio In Afghanistan

refund chart
KPE

* No matter when you filed your tax return, if you claimed the EITC or the ACTC, don’t forget to take into consideration that hold date.

My numbers are based on an expected IRS receipt date beginning on the open of tax season, February 12, 2021, through the close of tax season on April 15, 2021. To keep the chart manageable, I’ve assumed the IRS received your e-filed tax return on the first business day of the week; that’s usually a Monday, but if there’s a holiday (like President’s Day), I’ve skipped ahead until Tuesday. The same logic holds true for issuing refunds. In reality, the IRS issues tax refunds throughout the week, so the date could move forward or backward depending on the day your return was received.

MORE FOR YOU

McConnell Blocks Trump’s, Democrats’ Bid To Increase Stimulus Checks To $2,0005 Mistakes To Avoid With Retirement Account Beneficiary SelectionsTrump May Not Sign Stimulus Bill Without $2,000 Stimulus Checks; Here’s What Could Happen Next

Other sites may have different numbers but remember they’re just guessing, too: The IRS no longer makes their tax refund processing chart public.

Do not rely on any tax refund chart—this one included—for date-specific planning like a large purchase or a paying back a loan. 

Remember that if you claim the earned-income tax credit (EITC) and the additional child tax credit (ACTC), the IRS must wait until February 15 to begin issuing refunds to taxpayers who claim the EITC or the ACTC (that’s pretty close to the start date). Don’t forget to consider regular processing times for banks and factor in weekends and the President’s Day holiday. The IRS expects to see tax refunds begin reaching those claiming EITC and ACTC during the first week of March for those who file electronically with direct deposit and there are no issues with their tax returns.

If you want to get your tax refund as fast as possible, the IRS recommends that you e-file your tax return and use direct deposit. Keep in mind that if you e-file, the day that the IRS accepts your return may not be the day that you hit send or give the green light to your preparer. Check your e-filing confirmation for the actual date that the IRS accepts your return.

If you file by paper, it will take longer. Processing times can take more than four to six weeks in the best of times (and these are not the best of times) since the IRS has to manually input data. Don’t forget about postal holidays, too, when counting on the mail. There’s just one official postal holiday during tax season, Monday, February 15 (President’s Day), and one that follows just after tax season, Monday, May 31 (Memorial Day).

Even if you request direct deposit, you may still receive a paper check. Since 2014, the IRS has limited the number of refunds that can be deposited into a single account or applied to a prepaid debit card to three. Taxpayers who exceed the limit will instead receive a paper check. Additionally, the IRS will only issue a refund by direct deposit into an account in your own name, your spouse’s name or both if it’s a joint account. If there’s an issue with the account, the IRS will send a paper check.

If you’re looking for more information about the timing of your tax refund, don’t reach out to your tax professional. Instead, the IRS encourages you to use the “Get Refund Status” tool. Have your Social security number or ITIN, filing status and exact refund amount handy. Refund updates should appear 24 hours after your e-filing has been accepted or four weeks after you mailed your paper return. The IRS expect that the refund tool will be updated for those claiming EITC and ACTC, beginning on February 22, 2021. Otherwise, the IRS updates the site once per day, usually overnight, so there’s no need to check more than once during the day.

If you’re looking for tax information on the go, you can check your refund status with IRS2Go, the official mobile app of the IRS. The app includes a tax refund status tracker.

Remember that the IRS will not contact you by phone or by email regarding your refund. If you receive a call from someone claiming to be from the IRS or a debt collection agency regarding your tax refund, hang up immediately: it is a scam. Follow me on Twitter or LinkedIn. Check out my website

Kelly Phillips Erb

Kelly Phillips Erb Years ago, I found myself sitting in law school in Moot Court wearing an oversized itchy blue suit. It was a horrible experience. In a desperate attempt to avoid anything like that in the future, I enrolled in a tax course. I loved it. I signed up for another. Before I knew it, in addition to my JD, I earned an LL.M Taxation. While at law school, I interned at the estates attorney division of the IRS. At IRS, I participated in the review and audit of federal estate tax returns. At one such audit, opposing counsel read my report, looked at his file and said, “Gentlemen, she’s exactly right.” I nearly fainted. It was a short jump from there to practicing, teaching, writing and breathing tax. Just like that, Taxgirl® was born.

.

Gregg Learning

Once the tax liability has been determined, we must consider the final three items in income tax preparation: tax credits, other taxes, and payments. When an overpayment occurs, the taxpayer has the option of receiving a refund or applying the amount of the overpayment to next year’s estimated tax.

.

More Contents:

SimplyNoted Integrates with PropertyRadar http://www.propertyradar.com – Today[…] Property type Owner occupied Transaction volume per month Estimated equity Assessed value Estimated tax rate More Between the criteria you select to build your lists and the deep insights you get fo […]1

Thoughts on the Beginning by Al Sikes talbotspy.org – Today[…] faced by small businesses, I also noted how big businesses operate within a framework of tax advantage. They retain a variety of international experts to help them minimize taxes. Tax specialists guide them through the intricacies of reduction as they move manufacturing, sales […] intricacies of reduction as they move manufacturing, sales, distribution and even headquarters to tax-advantaged locations. President Biden is recommending a corporate tax increase going from 21% to 28%. Specific tax thresholds can get very complicated and are well beyond these several paragraphs […]0

WeekWatch – 25_01_2021 | St. James’s Place Wealth Management partnership.sjp.co.uk – Today[…] ahead, there are some fears that the chancellor’s rumoured plans to hike the main rate of corporate tax could dampen the recovery […]6

Hydropower Provisions Included in 2021 Appropriations Bill | Troutman Pepper – JDSupra http://www.jdsupra.com – Today[…] Next, the Act extends the production tax credit (PTC) and investment tax credit (ITC) in lieu of PTC through January 1, 2022 at existing rates […]0

WeekWatch – 25_01_2021 | St. James’s Place Wealth Management http://www.hjpcfp.com – Today[…] ahead, there are some fears that the chancellor’s rumoured plans to hike the main rate of corporate tax could dampen the recovery […]0

Investments and Insurance – Popular Private Client – Popular Bank http://www.popularbank.com – Today[…] the benefits of your employer-sponsored plans, a 401(k), 403(b), or 457, and tapping into the other tax-advantaged plans such as IRAs and small business retirement plans, is one of the best ways t […] Not all tax advantages may be available to you […] as they relate to your individual retirement accounts, should be reviewed with your professional tax advisor […]28

— Are financial savings and insurance products safe… cmsgroupca.tumblr.com – Today[…] Tax-free savings account The tax-free savings account is an occupied or seizable savings product, regardless of the kind o […] The people who have a justifiable social insurance number to set money apart from tax-free throughout their lifetime. The benefaction of a tax-free savings account is not conclusive for income tax purposes […]0

Saudi sovereign wealth fund to invest billions to tackle soaring joblessness http://www.middleeasteye.net – Today[…] pandemic and a drop in oil prices prompted the top crude exporter to triple its value-added tax and suspend a monthly allowance to civil servants to rein in a ballooning budget deficit […]0

Thomas Azzara on LinkedIn: Google has no office, no staff and little more than a plain PO Box http://www.linkedin.com – Today[…] ; “We are pleased to tell you that our examination of your tax return(s) for above periods shows no change is necessary in the tax reported.” – Lowrery / Chief Examination Division/IRS (tax reported was 0$) (IRS audit was for Thomas Azzara) Google’s PO Box in Bermuda […] They probably have several companies in Bermuda – a no tax haven. Trade stocks tax-free (Capital Gains Taxes) OK under the Internal Revenue Code for foreign companies […]0

Save The Poudre – Help us save the Poudre from the NISP/Glade Reservoir http://www.savethepoudre.org – Today[…]  If you can afford $100 or $250 or more, that’s great too! All donations are tax deductible Please donate on our website at: http://www […] ” The memo reminds the City Council that the citizens of Fort Collins tax themselves to buy these Natural Areas, most recently by a city-wide vote in 2014 with 82 […] All donations are tax deductible Please donate on our website at: http://www […]49

Strength * Rose Quartz, Aquamarine, Moonstone & Carnelian – crystal-point-gems.com – Today[…] 00 Tax included […]0

School choice legislation on the fast track myemail.constantcontact.com – Today[…] the “Missouri Empowerment Scholarship Accounts Program” and specifies that any taxpayer may claim a tax credit, not to exceed 50% of the taxpayer’s state tax liability, for any qualifying contribution to an educational assistance organization for all tax years beginning on or after July 1, 2022. The cumulative amount of tax credits issued in any one calendar year shall not exceed $50 million […]0

Medicare Advantage Plans (Medicare Part C) | James DeMinno CPA http://www.deminno.tax – Today[…] The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation […]0

OMG: The Right Is Trying to Turn Insurrectionist Snowflake Josh Hawley Into a Free Speech `Martyr’ http://www.dailykos.com – Today[…] that the job of the Republican Party to team up with corporate America to force deregulation and tax cuts on the public […]0

Advancing Innovation to Make the U.S. More Globally Competitive spark.adobe.com – TodayTax Policy Tax policy not only helps drive competitiveness, but is an effective tool to support economic growth […] maintains an internationally competitive tax system, including a competitive and fiscally responsible corporate tax rate. Policymakers also have the opportunity to leverage tax policy to promote growth in high-skilled, highly paid jobs, including by supporting innovation an […] certainty for businesses worldwide and turn the tide against the proliferation of unilateral tax measures that contravene key international tax policy norms and impact the competitiveness of U […]0

Janet Yellen’s Senate confirmation vote to be treasury secretary set for Monday – CBS News http://www.cbsnews.com – Today[…] Yellen on a number of her positions, particularly in the tax policy arena, but she has committed to us that she will work with us on these issues and th […]0

Rémi Belliveau on Lost Classics of Acadian Disco and Rock ’n’ Roll – canadianart.ca – Today[…] When she replies that she’s not only Acadian, but also a proud tax-paying (my terminology) Québécoise (she’d been living in Montreal for almost 20 years by that time) […]43

“It Ain’t Over Till It’s Over” – Newsroom – About.usps.com about.usps.com – Today[…] The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its […]15

PSW Tax Coffee Chat – 2020 Tax Relief Bill – Cvent | Online Registration by Cvent events-meetings.kpmg.com – TodayLegal | Privacy © 2021 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. For more detail about the structure of the KPMG global organization, please visit https://home.kpmg/xx/en/home/misc/governance.html.N/A

Security Summit Alert: New Two-Stage Email Scheme Targets Tax Professionals | Internal Revenue Service http://www.irs.gov – Today[…] 11, 2017 WASHINGTON – The Internal Revenue Service, state tax agencies and tax industry leaders today warned tax professionals to be alert to an email scam from cybercriminals posing as clients soliciting thei […] The tax professional may think they are downloading a potential client’s tax information or accessing a site with the potential client’s tax information […]5

Samoa: Staff Concluding Statement of the 2021 Article IV Mission HTML File http://www.marketscreener.com – Today[…] The surplus in FY2020 was driven by a favorable outturn in tax revenue collection owing to improved tax compliance in advance of the phased rollout of the Tax Invoicing Management System (TIMS) […] through revenue mobilization over the medium term: A holistic approach will be needed by improving tax compliance, increasing excises (e.g., alcohol and tobacco), and broadening the VAT tax base in light of a gradual revenue loss expected from the PACER-Plus agreement […]0

HMRC waives penalty for late filing of self-assessments http://www.bbc.co.uk – Today[…] The tax agency said more than 8.9 million customers have already filed their tax returns. However, taxpayers are still required to pay their tax bills by 31 January […] However, they will need to file their 2019-2020 tax return first. People who have tax bills over £30,000, or who need longer than 12 months to pay their bill, are advised to call HMRC […]0

Money Management – Webster First Federal Credit Union http://www.websterfirst.com – Today[…] more Search by keyword or amount, or filter by account and date to quickly find specific entries Tax deductible transactions can be marked throughout the year and filtered for easy access come tax time               Keep track of spending and set budgets Use a visualization of spendin […]0

HOT JOBS & COOL JOBS: RN/LPN CHARGE NURSE 10PM 630AM 5000 SIGN ON BONUS BIRMINGHAM AL USA http://www.e-physician.info – Today[…]  Pay package is based on 12 hour shifts and 36 hours per week (subject to confirmation) with tax  […]  Pay package is based on 12 hour shifts and 36 hours per week (subject to confirmation) with tax  […]0

Paychex | Paychex-IFA Empower Hour pages.paychex.com – Today[…] of the Paycheck Protection Program (PPP), changes to the employee retention and paid leave tax credits, and more […]

What You Can Do Right Now to Make 2021 Your Best Tax Year Ever

Traditional tax planning is transactional and, honestly, not nearly as beneficial as one might think. You ask your taxes preparer questions and figure out what to do in the spur of the moment. Creating a long-term plan of action for your taxes is how to create real savings, but it takes months to create an effective plan. Now is the time for business owners and investors to be planning to reap the rewards for the rest of 2020 and into 2021.

Analyze income

Many accountants suggest pushing income to a later year. There are a few different factors to consider when deciding whether to do this. First, is your income so low you lose deductions? Many personal deductions don’t carry over to the next year. Rather than taking deductions now, you may want to accelerate your income to make use of all your deductions. Another factor to consider is the next year’s tax rates. There’s a real chance that income tax rates could increase in 2021, so the best plan would be to accelerate your income into 2020 to avoid paying at a higher rate.

Related: 5 Tax Strategies to Help Your Business Survive the Coronavirus Slump

Identify opportunities

With both economic and political uncertainty, it’s likely that we’ll see another economic downturn in 2021. During those times there are always opportunities to succeed, but if you don’t plan for them, you’ll be left with remnants. Now that you have an income tax plan in place to reduce your taxes, you can plan to use those savings to invest when the market goes down and investments are cheaper. We all saw the winners and losers following The Great Recession, so make sure you’re prepared to take advantage of opportunities that increase your wealth.

Become someone tax law favors

While preparing to make investments, consider if they’re the ones the government wants you to make. Tax laws are a series of incentives for business owners and investors and it’s easy to take advantage of the opportunities when you understand how the laws can work in your favor.

The government favors producers like business owners, real estate investors and commodity providers and has created huge tax incentives for these activities because they spur economic growth. While consumers typically owe 40% in taxes, producers can easily pay less than 20% in taxes based on the level of their activity. This reduction in taxes allows you to continue to reinvest and grow your wealth.

Related: Analyzing Joe Biden’s Tax Plan

As you can see, reducing your taxes is a valuable and time-consuming process. While 2020 was a difficult year for many, 2021 holds opportunities for those who plan appropriately. Don’t allow yourself to be stuck in a tax rut doing the same things you’ve always done. It’s time to reevaluate your plan and set yourself up for your best tax year yet.

By: Tom Wheelwright / Entrepreneur Leadership Network Contributor

In this 7-minute video clip recorded this morning – 24th August 2020 – Paul takes a brief look at the minimal tax changes in this years’ CF, ER and CeMAP syllabus. Paul’s at https://www.archertraining.co.uk/

The 5 Best Tax and Financial Franchises You Can Open This Year

1

With a delayed tax day, PPP loans and government bailouts, personal and finances have rarely been as confusing as they are in 2020. Helpful experts are vital right now, and these financial businesses can provide a much-needed boost to their environments.

Whether you already have your own tax service company or lack experience in the industry, one of the top five entries in the sector of our Franchise 500 can help you make a good investment … and help your clients make one, too.

1. Goosehead Insurance Agency LLC

  • Entrepreneur Franchise 500 Rank: 129
  • Franchising since: 2011
  • Initial investment: $41,500 to $116,500
  • Initial franchise fee: $25,000 to $60,000
  • New units in 2019: 111 units (+26.2 percent)

Goosehead Insurance Agency LLC manages a portfolio of A-rated insurance carriers, allowing its franchisees to focus on sales and new business. The company, which started franchising in 2011, has shown tremendous growth over the past three years in particular, adding 345 U.S. franchises (a 181.6 percent increase).

Related: The 5 Top-Ranked Franchises You Can Buy for as Little as 5 Figures

2. Jackson Hewitt Tax Service

  • Entrepreneur Franchise 500 Rank: 197
  • Franchising since: 1986
  • Initial investment: $45,130 to $110,255
  • Initial franchise fee: $15,000 to $25,000
  • New units in 2019: 33 units (+0.6 percent)

Jackson Hewitt Tax Service offers a mentorship program and has regional directors who can help franchisees create their business strategies. Its Walmart kiosks expand the company’s brand across the country, and the year-round tax service specializes in computerized federal and state preparation for individual returns.

3. Brightway Insurance

  • Entrepreneur Franchise 500 Rank: 254
  • Franchising since: 2007
  • Initial investment: $42,300 to $178,916
  • Initial franchise fee: $30,000 to $60,000
  • New units in 2019: 25 units (+15.1 percent)

Brightway Insurance prides itself on being accessible to those without experience in the field. “In fact,” states the company website, “half of all Brightway locations with Books of Business over $10 million are owned and operated by people with no prior insurance background.” The company has seen strong growth over the past three years, going from 123 units to 191 since 2016.

4. H&R Block

  • Entrepreneur Franchise 500 Rank: 306
  • Franchising since: 1956
  • Initial investment: $31,557 to $149,398
  • Initial franchise fee: $2,500
  • New units in 2019: -564 units (-5.2 percent)

Founded by brothers Henry and Richard Block in 1955, H&R Block has since prepared more than 600 million tax returns. The company offers an array of financial services to its customers as well as to potential franchisees — tax business owners can sell their business to H&R Block and work with the company on a personalized exit plan that offers competitive buyout packages.

Related: 10 Low-Cost Franchises You Can Start From Home Right Now

5. Fiesta Auto Insurance and Tax

  • Entrepreneur Franchise 500 Rank: 336
  • Franchising since: 2006
  • Initial investment: $67,052 to $120,599
  • Initial franchise fee: $10,000
  • New units in 2019: 11 units (+5.6 percent)

Fiesta Auto Insurance and Tax was originally founded to meet growing demand for auto insurance within underserved Hispanic and blue-collar communities in Southern California. In the past decade, the company has seen strong growth, tripling its number of units from 68 to 207 since 2010.

By

Source: https://www.entrepreneur.com

GM-980x120-BIT-ENG-Banner

✪✪✪✪✪ http://www.theaudiopedia.com ✪✪✪✪✪ What is FRANCHISE TAX? What does FRANCHISE TAX mean? FRANCHISE TAX meaning – FRANCHISE TAX definition – FRANCHISE TAX explanation. Source: Wikipedia.org article, adapted under https://creativecommons.org/licenses/… license. A franchise tax is a government levy (tax) charged by some US states to certain business organizations such as corporations and partnerships with a nexus in the state. A franchise tax is not based on income. Rather, the typical franchise tax calculation is based on the net worth of or capital held by the entity. The franchise tax effectively charges corporations for the privilege of doing business in the state. Whether or not a business must pay a franchise tax to a state in which it does business can cause some confusion. Some states report using both the economic and physical presence tests, and in some states there are no written, public interpretations of their test at all.
%d bloggers like this: