Taxes?

[gohawks88]

i've been self-employed doing some computer work the last year. tax rate is down a little, but it's a huge risk and very stressful being self-employed sometimes! i love it, but i do miss having a steady paycheck....

[quasarvs]

Meanwhile at Excelsior they only count the credits you gain through their classes and your GPA through their classes for aid, which I presume also applies to the tax situation, someone better versed in tax law may be able to argue that CLEP exams are eductional costs and therefore deductable as an expense.

Yeah that's sort of what I was getting from the people I talked to. THey kept mentioning the requirements for financial aid.
But I'm going to talk with someone in a few who can hopefully clear things up for me on TESC's policy of fulltime verus half or partime student.

[quasarvs]

i've been self-employed doing some computer work the last year. tax rate is down a little, but it's a huge risk and very stressful being self-employed sometimes! i love it, but i do miss having a steady paycheck....

Really?? Tax rate down?

Because I know through experience that self-employed people get the worst ding financially from the irs.
Although, I agree self-employment is the best.

[quasarvs]

On page 42 of Publication 970 the IRS defines a "half time student" as the following: Publication 970, Tax Benefits for Education

Our school's standards accept CLEP, DSST, SL, etc. so those forms of credit are valid. TESC accepts them, you earned them. That's the way I see it. So, I'd take the total number of credits you've earned this year into consideration, not just the classes.

However, that's just my opinion and people's opinions are going to vary. Submit a ticket to TESC explaining what your situation. Get in writing whether you're a full or part time student. If they say you're a full time student, print it out and keep it for your records since claiming a tax credit may make you more likely for an audit (odds are still VERY low, but it does raise it for a bit).

Well as that said, "as determined under the standards of the school where the student is enrolled" I contacted someone at TESC and they have been saying that they don't classify their students as part-time or full-time, because of their unique system. Instead they are told to refer the student to a tax person/expert.
So I'm still trying to get some sort of answer;however it looks like at best I'll be considered a part-time student.

UPDATE:
Well I was told because of my 6 credit course, I'm considered a part-time student.

[Daithi]

Everyone is scared of the IRS but I've been audited and they were actually pretty nice. If you save the email from TESC that says "they don't classify their students as part-time or full-time, because of their unique system" then I think you would be pretty safe in claiming yourself as a full-time student as long as you earned around 30 credits for the year (i.e. a years worth of credit) and you can prove it. The worst that could happen is that if you did get audited (not likely) then they might not allow the deduction, but chances are pretty good they will allow it. [Of course, I'm not a tax attorney, so take all tax advice... blah, blah, blah.]

I just looked at one of the examples from Publication 970, Tax Benefits for Education

Example 5. Dee graduated from high school in June 2011. In January 2012, Dee enrolled in a 1-year postsecondary certificate program on a full-time basis to obtain a certificate as a travel agent. Dee completed the program in December 2012, and was awarded a certificate. In January 2013, she enrolled in a 1-year postsecondary certificate program on a full-time basis to obtain a certificate as a computer programmer. Dee is an eligible student for both tax years 2012 and 2013 because she meets the degree requirement, the work load requirement, and the year of study requirement for those years.

If that is the case then a typical TESC student who enrolls at TESC and earns at least a years worth of credit through CLEP or other CBE testing should qualify as well. You are meeting the degree requirements, performing the workload requirements, and doing it during year for which you are filing.

[quasarvs]

Okay, Thanks for your advice.
At least, you had a "good" experience.
However, I think the worst that could happen is that they fine you (generically as in anyone) for making an error or something.

Anyway, I didn't want to derail the other discussion going on for Merolpn and OE800_85; So please
continue.....

[merolpn]

I emphasized the word "relatively" in my post. In that the staff doing this work is always getting a relatively smaller and smaller piece of the pie. It's a microcosm of the world today. The world is becoming extremely top heavy. So much so, that in America, a family that makes minimum wage can starve (and no, i'm not talking about drug addicts and people who make bad choices with money). You said the doctors keep working because they get a comfortable, fair salary. So, are you saying administrators can't be happy with a fair, comfortable salary? The only reason they make so much, is because they're holding all the cards. They make the decisions, so of course they will pay themselves handsomely. If you were in charge, you'd give yourself as much money as possible. For a non-profit institution, that is supposed to be helping the community, it's sickening.

I think one thing you have to do is divorce the idea of the "non-profit" title from employees and their pay. Whether it is the top CEO or any staff member, the non profit has to pay a wage that competes with the "for-profit" entities in their industry. Pure and simple. Personally, I find it sickening that in 1960 (I believe) the average CEO was paid 30 times more than the average salary of someone employed by the company the manged, but today that has soared to 110 times the average employee's salary. So, I do agree that the disparity between income levels is a problem but I would be hard pressed to name the victim because collectively everyone is earning more. Maybe we can say the consumers are the victim? Good luck getting them together to make a change. Some financial people where I work tried to explain to me why this happened and really couldn't do it confidently. I guess sometime around the late 70's these CEO's were all sitting on each other's boards agreeing to extremely high salaries for eachother. Most CEO's do not dictate their own salaries and most work under a contract that they agreed to before they started. They don't "give" themselves raises unless their compensation is based off of stock pricing. The CEO can earn more by running the company efficiently to increase the earnings.

As for the top administrator living off of a comfortable salary like a doctor, I am sure he could do it, but he doesn't have to. He will choose another employer that will provide the most compensation for him trading his time. This is what we all do, unless your life's work is volunteering. It is just on a different scale. This is why we seek higher education, to have a competitive edge over someone else. All of our hard work is so we will receive more compensation for giving up our time over the next best option for the use of that time (different employer,opportunity cost). The same thing is true for that $1.8MILL CEO.

I didn't make that decision. The hospitals made that decision when they chose to be non-profit enterprises. If they disagree they can go back to being for-profit and face the same rules as every other business. Again, many for-profit hospitals exist. However, they're not as insanely profitable because they can't take advantage of the system so well.

You have to qualify "insanely" with a dollar amount. I personally do not know what a hospital should earn and what would qualify as "insane" to make a determination. Do you? We don't know if some of those "insane" earnings are going to be used for a future expansion. Wouldn't it be good if they earned enough money to expand and help even more people? I would caution against looking at a snap shot of "earnings" because it isn't an accurate picture that takes the future into account. It is what gets done with those earnings that matters.

This is one of the biggest contradictions the pharmaceutical industry has given. R&D is an investment, one that will pay off with success. That's capitalism. They choose to go down this road and develop these drugs, why should we pay for that? You talk of free markets and somehow we should be giving these companies, a handout?

The good thing for those of us in the U.S. is that a majority of these companies are here. If we changed the rules for them now, they will pick up and go to where they can do business more easily. Perhaps one of those "underdeveloped" countries may really want them there? These are not "handouts" they are the rules that are previously agreed to. So let's assume that we are giving them tax breaks as "handouts," and these tax breaks equal whatever dollar amount you wish. So tomorrow we say "no more handouts." Who pays? Right now the taxpayer is paying, tomorrow the price of the medication goes up. Those who need the medication and have to pay get hurt the most. They don't take a loss. What if we say "no more taxpayer handouts AND you can't raise the price"? Who pays then? Do they take the loss or do they move. What if they leave? How many jobs are lost? How much local tax revenue is lost? How many employee lunches will not purchased at the deli on the corner. So what happens to the lady that owns the deli? Maybe she survives, maybe she doesn't? I know the price of medication is ridiculous but we shouldn't tamper with their business model too much. The problem of cost could be solved by eliminating barriers that prevent new companies from starting. Perhaps, it goes deeper than this and to get barriers removed we need real campaign finance reform to remove the pharmaceutical money from decision making. The capitalist system works best when the government and politicians stay out of it.

I have no idea why there are so many pharmaceutical ads in this country. I believe they should be illegal. The only person who should be recommending medicine (and who has the skills to do so) is your doctor. However, these ads encourage people (who know nothing of medicine) to "ask their doctor" and push them to medicate them. Doctors realize this, as well as the added incentives and bonuses we know they're receiving for doing so, and we end up dosing the masses.

I can understand the frustration with this but you cannot restrict the free speech of these companies. I hate the adds too, but I don't have a medical condition for which I need most of the medications. Well, except for that little nasal allergy bee with the accent (yeah, you know him). But this is because I have allergies. So I think about people that may have another condition and realize, that little bee gave me hope with my allergies (he really did!), what if I needed help with depression. Maybe, I could talk to my doctor about some drug I saw on TV and for the time being have hope. (As a side note, how come so many medications for depression list "thoughts of suicide" as a side effect?)

As an added note, I personally believe there should be no profit from healthcare. We, as healthcare consumers, have a raw deal. We don't see bills before we pay them, we can't negotiate with pharmaceutical companies and hospitals over prices (while medicare/medicaid can), and we end up getting forced to buy something we need at an inflated price. America has the worst public health of any developed country in the world, and often it's worse than many developing/under developed nations. There's a reason for this, and it all boils down to issues like these.

I do not believe it should be free. Goods and services provided from the government are never free. Somebody has to pay and it will be the rich and middle class that shoulder the burden if it was provided "free." Nowhere in the Constitution is there anything about one person gaining off of the production of another. Taxes were supposed to be for very limited things. The federal government is really only to secure the borders (which they don't do), provide for national defense (which they do, but more money is wasted on fruitless offence) and promote trade between the states (which they hinder through excessive regulatory bodies like the EPA). It wasn't until the 1900's that more and more social programs became taxpayer funded. Expanding healthcare will get us into deeper trouble than we are in now. Look at all of the other "developed" countries that have huge entitlement programs. The rich are leaving France, Greece is bankrupt, Spain is in horrible shape, however Germany is surviving only because they keep public spending under control. We don't control spending here.

[merolpn]

Anyway, I didn't want to derail the other discussion going on for Merolpn and OE800_85; So please
continue.....

Never derailed, only improved.

[OE800_85]

This has been a great debate but I feel we're at a bit of an impasse, perhaps we'll just keep going back and forth on this topic, so I won't address every issue you mentioned.

I'm just curious...
Do you agree/disagree that america has the worst public health among western developed nations? (You didn't address that directly)
Do you feel the wealth disparity has gone too far? That, despite all wages going up, with inflation considered the lower and most of the middle class have lower relative buying power?
When did we agree to go on this tirade to pay for pharmaceutical companies' R&D? I don't think the people voted for that.
Who decides the salaries in companies, if not the top executives?

[Publius]

This has been a great debate but I feel we're at a bit of an impasse, perhaps we'll just keep going back and forth on this topic, so I won't address every issue you mentioned.

I'm just curious...
Do you agree/disagree that america has the worst public health among western developed nations? (You didn't address that directly)
Do you feel the wealth disparity has gone too far? That, despite all wages going up, with inflation considered the lower and most of the middle class have lower relative buying power?
When did we agree to go on this tirade to pay for pharmaceutical companies' R&D? I don't think the people voted for that.
Who decides the salaries in companies, if not the top executives?

Do you expect him to now answer all of your questions? Just curious.


This is actually one of the reasons I try to stay out these types of debates in these types of settings. Reason 1... you never get very far. Reason 2... half the questions or issues you bring up are ignored by the person/party. In the end, a decent amount of time was consumed, and minds are ever so rarely changed, if ever.