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February 12, 2009     Tri-County News
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February 12, 2009
 

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Thursday, February12,2009 T Tri-Coun News Kimball, MN ...._.. Page 13 Tax time tips: Last chance to save CRtWe.0 2000.8 taxes on 2008 income 00lChe||e FISChbaCh wa r- allty ByJim Wirz, Tax Specialist eral other advantages At age 59 Minnesota State Senator With the start of the new year, and a half, distributions are tax- Week in review: Feb. 2-6 monitoring there is very little that you can do free and there is no required min- Results from the Clearwater River Watershed District (CRWD) to impact the taxes you will pay for 2008. One exception is using the IRAs (Individual Retirement Accounts) to reduce taxes and/or qualify for some tax credits. IRAs come in several flavors, the best known being the tradi- tional IRA, the Roth IRA, and the SEP IRA. Deductions for IRAs on 2008 income tax returns can be made until the due date of the return, including extensions. For most of us that is April 15, 2009, or six months later for thos filing extensions. In order to contribute to an IRA, you must have earned income. Contributions to IRAs may als0 be limited by income and by a tax- payer&apos;s eligibility to contribute to other retirement plans. Contribu- tion limits are the lesser of $5,000 ($6,000 if over age 50) or taxable compensation. A SEP IRA for self- employed persons has a limit of 20 percent of income after the self- employment tax deductions. If a self-employed person has employ- ees, they must also be covered by the plan. The tax advantage for contrib- uting to a traditional IRA or a SEP IRA is that it reduces the adjusted gross income (AGI) and your tax- able income. The taxpayer pays less income taxes and it could be helpful if this contribution drops the taxpayer into a lower tax bracket. A lower AGI may also increase the value of other cred- its, the child and dependent care credit being one example. A contribution to a Roth IRA will not lower taxes, but it has sev- imum distribution. The Roth is flexible enough to act as a kind of emergency savings account ads long as the rules governing Roth's are followed. Since Roth distribu- tions in retirement are not taxable, they do not count as income when figuring the taxability of Social Security benefits. The best credit for those put- ting money into a retirement plan, iuncluding a Roth or Traditional IRA, is called the .Retirement Sav- ings Contributions Credit. This credit is intended to encourage people to save for retirement and is like receiving free money from the government. A married cou- ple filing jointly qualifies for this credit if their AGI is under $53,000 in 2008. The credit can range from 10 percent to 50 percent of the con- tributions with the credit limited to $2,000 for a married couple. It is a great way for lower-income tax- payers to build up their retirement savings. The primary pur0ose of the IRA is to provide income at retirement, but it can also be an important tool in reducing taxes during a taxpayer's working years. The pri- mary disadvantage is that the tax- payer must have funds available to invest in that IRA during his work- ing years. This information is provided by Jim Wirz, a tax specialist with H & R Block, and is not intended as personal tax advice. He may be contacted by e-mail at <james. wirz@tax.hrblock.com> or by phone at (320) 252-0779. Woman Writes Historic Letter to Her Congressman BEXAR COUNTY- After applying Thera-Gesic to her arthritic hands. Mary Ann W. hand wrote a forty-seven page letter to her Congressman explaining the true meaning of life. When asked where she had gathered all the wisdom for writing such a masterpiece and why she sent it to a government official, she painlessly replied, "'None of your dang business!" Go painlessly with Thera43esic  Another interesting week at the Legislature has passed, with a majority of the work being done in Senate and House committees. In five weeks, almost 500 bills have been introduced in each of the legislative bodies. Unfortunately, those seeking to increase state spending and fund legislator's pet projects far outnumber those that would make any progress reducing our budget deficit, or encouraging job growth in Minnesota. We were able to pass resolu- tions in both houses that set dead- lines for policy and finance bills to pass committees. The first will be March 27, for committees to act on bills in the house of origin. This doesn't prohibit ideas or portions of bills from being amended on to other bills later in the session. The date will also give law- makers about three weeks from the official update on Minneso- ta's growing budget deficit, which some are now predicting could reach about $8 billion (currently it is just under $5 billion). Public employee salary freeze One of the bills introduced this week offers legislators a big step toward reducing some of that defi- cit without raising taxes. The mea- sure would freeze the salaries of all public employees during the FY 2010-2011 biennium, includ- ing state, MnSCU, school district, county and city employees. It does not freeze salaries of employees at the University of Minnesota; however, they are encouraged to implement a freeze as though they were covered by the bill. The plan could save $1 billion over the two- year budgeting period and possi- ble prevent some layoffs. School bus safety Another bill introduced this week would provide additional money to school districts for stu- dent busing expenses, prioritizing the state's commitment to edu- cation by rerouting $100 million from transit funding. Both the Metro Transit Account and the Greater Minnesota Tran- sit Account are funded through the Transit Assistance Fund out 0fMin- nesota Vehicle Sales Tax (MVST) funds, and the Counties Transit Improvement Board would contrib- ute $50 million from funds collected by the new'?-cent sales tax metro area counties can now collect. Said the author: "A bus is a bus and when you get down to it, taxpayer dollars are paying for all of them. Shouldn't we fund the ones our children ride before we fund the others?" QlComp reports The three-year old alterna- tive teacher-pay program called Q-Camp got mixed reviews from the state Legislative Auditor's report released this week. The report says most teachers and administrators say they like the professional development oppor- tunities, but standards are differ- ent for some of the 72 school dis- tricts and charter schools that received $49 million in 2008-2009 in the program. The report, which says increased student achieve- ment is not yet measurable, fol- lows a plan by Gov. Tim Pawlenty to move all of the more than 500 districts and charter schools onto Q-Camp. Days prior to the hear- ing, the Department of Educa- tion released a report they com- missioned that shows a significant and positive relationship between the number of years a school has been implementing Q-Camp and student achievement. Q-Camp provides additional pay for'pro- fessional development and lead- ership opportunities, and requires school participants to develop a pay system for teachers that bases raises on performance. Finding bills online Just a reminder: If you are inter- ested in learning more about bills introduced in the Legislature, contributing your ideas on the state budget process, or watching committees or floor session, go to <www.senate.mn> and find links that make your state government more accessible. Senator Michelle Fischbach is serv- ing in her fifth term in the Minnesota Senate. She encourages and appre- ciates constituent input and can be reached at (651) 296-2084, by mail to 145 State Office Building / St. Paul MN 55155 or via e-mail at <sen.michelle. fischbach@senate.mn>. Water Quality Monitoring shows that the CRWD received less rain than usual, that resulted in less runoff than normal in 2008. This, in turn, resulted in phosphorus loading below the 5,000-pound goal set for Clearwater Lake. The water quality in all lakes in the CRWD has remained stable over the last 10 years, although 11 lakes in the watershed are consid- ered impaired. Lakes or streams are considered impaired if the monitoring shows exceedences of state standards for nutrients, dis- solved oxygen, or fecal coliform. The CRWD is currently devel- oping a Total Maximum Daily Load (TMDL) implementation plan to recommend activities that will bring the impaired waters within state standards. The 2008 CRWD Water Quality Monitoring Report is available at the Annandale Public Library, the CRWD Office, and from the CRWD managers. We have -J Plat Books with 9-1-1 addresses and legal land descnpUons (*other counties can be ordered) $21. 00 + tax downtown Kimball (320) 398-5000 Building Site Prep. * Demolition - Basements Additions o Fill & Black Dirt o Septic Systems. New or Repair State Certified - Over 25 Years Experience ,, Free Estimates Call Larry Krippner, Owner (320) 398-8893 Marty, MN IPPN00- LAND O'I.AKES OIL & PROPANE KIMBALL, MN P ropfide Soy Diesel Fuel Kerosene Motor Oil Tank Truck Gasoline Transport Tires ManqaneT Senbus E&na Reatry Call me for all your real estate needs! (320) 267-2516 (cett) !! ![_!Jl! !!! (9)_: [r---- :--]/:! ;!_- 1 I._l_!!.l.!l.l[_ t Superior to other wails h energy efficiency & safety! Chuck: 320-291-1311 Richard: 320-295-8083 Br0thm Licensed & Bonded #0001091 Building & Remodeling Residential Builders FRRB BSTIMATES Chuck: 320-398-7512 Bob: 320-255-1662 Kimball