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06.24 Mr. Holder, You Must Hold Torturers Accountable Health & Environment
06.29 Thinking about Climate 06.26 False Health-Scare Ad on CNN 06.25 Louella Learns the Limits of Medicare 06.23 The Simple Answer to America’s Health Care Crisis: Medicare for All 06.23 Tell ABC: Include Single-Payer in Healthcare Debate 06.23 Serving the Medical-Industrial Complex 06.22 Thinking about Recoveries 06.20 Obama's Health Care Waterloo 06.15 Obama, Like Clinton Before Him, is Blowing the Chance for Real Health Care Reform 06.11 Two Key Health-Care Numbers 06.10 Big Breakthroughs for Single Payer Health Care 06.10 Readying Americans for Dangerous, Mandatory Vaccinations Media Watching
06.29 WP's Connolly Back, on Health Reform 06.17 Hypocrisy and Hope: Western Coverage, Iranian Courage 06.15 Excusing Outrages of the Right 06.11 Tying Obama to Bush's Budget Mess US Politics, Policy & Culture
06.30 Obama's Torture Hypocrisy 06.30 Court Circular: Annals of Imperial Continuity 06.29 Obama, They Want You to Fail 06.26 Who to Trust on a Truth Commission? 06.26 Tarnished Shields: The Morally Bankrupt 'Family Values' Republican Leadership 06.25 America's "Bases of Empire" 06.24 Twelve Angry White People: Jury Nullification in a Pennsylvania Coal Town 06.24 Touring Empire's Ruins 06.23 Employers are Undermining the Economic Stimulus Program 06.19 Criminalizing Dissent: Obama Pot Calls Iranian Kettle Black 06.17 Afghanistan's Operation Phoenix 06.16 Are You Ready for War with a Demonized Iran? 06.13 Where's the Anger as the Wheels Come Off Obama's and the Democrats' Recovery Program? 06.10 Waiving the Rules for Old Glory 06.10 Obama's Era of Openness Is Closed High Crimes?
07.03 Reviewing Marjorie Cohn and Kathleen Gilberd's "Rules of Disengagement" 07.01 Iraq: A Bitter Strategic Failure 06.25 It's All Good, Again: 'Uptick' in the American-Made Tides of Violence in Iraq 06.22 Obama Opposes Plame-gate Release 06.21 Dexter's Legions: The "Good" Killers of the "Good" War 06.18 Extending the Tradition: Proudly Taking American Torture Into the Future 06.15 New UN Report Denounces America's Human Rights Record 06.14 Fear Rules Economics & Business Non/Mis/Malfeasance
07.01 Michael Hudson's "Super Imperialism:" The Economic Strategy of Imperial America 06.23 Obama's Financial Reform Proposal - A Stealth Scheme for Global Monetary Control 06.10 Cyberscares About Cyberwars Equal Cybermoney International
07.01 Pirates of the Mediterranean 06.29 Color Revolutions, Old and New 06.25 Iran Divided & the 'October Suprise' 06.23 Astringent Corrective: AbuKhalil on Iran's Turmoil 06.20 Are the Iranian Protests Another US Orchestrated “Color Revolution?” 06.20 Through a Glass Darkly: Sifting Myth and Fact on Iran 06.19 Iran's Election and US - Iranian Elections 06.16 The Ir-Af-Pak War: Obama Looses the Manhunters 06.12 Israeli War Crimes Against Children During Operation Cast Lead We are a non-profit Internet-only newspaper publication founded in 1973. Your donation is essential to our survival.
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ECONOMIC ANALTSIS:Thinking About NumbersThe implications of potentially lost future tax revenues (not to mention digging into federal and state coffers to underwrite any refunds) of this Net Operating Losses consolidation time bomb are enormous.
I’ve been thinking about the numbers. Actually I’ve been thinking about taxes, the bailouts/ costs/ NOLs (Net Operating Losses), incentives, and refunds. We are in deep “do-do!” The numbers in the NEWS relating to the bailouts, financial and economic fixes, Net Operating Losses/ write offs, unemployment/ layoffs/ downsizings, and deficits are astronomical. Numbers - unless they have a dollar sign in front of them, they impact your immediate household (or business), or you are an accountant like me – might seem boring. ABSOLUTELY NOT TRUE... so please bear with me here.You see, it has been said the only two things in life that are certain are death and taxes! Because of original sin, you die. Because you must render onto Caesar that which is Caesar’s, you pay taxes. The stories on Page One and the network NEWS have been chronicling the business losses, failures, and takeovers. Uncle $ugar (via the US Treasury and the FED) has been attempting a fix and turnaround by bailouts, repurchase agreements to warehouse worth-less and worthless securities, guarantees, low cost loans, and out and out “gifts” of the people’s money. These are already running in the TRILLIONs! Yet, no one has zeroed in on the costs to the public purse by the impact of the merged NOLs on past and future business tax revenues. There haven’t been answers given, because nobody is asking the questions! TH*NK of this as the latest hybrid of “don’t ask, won’t tell” – so much for the promised transparency! When one business entity acquires/ mergers/ consolidates with another. This marriage of sorts is more than a combining of assets and liabilities - getting the assets, and assuming the liabilities. The tax implications both going backward and forward are tremendous. Depending on how the assumption agreements, the pre-deal determinations and structuring, and the post-deal tax filings are made; the acquiree’s business losses can shelter (as in make tax free) the acquirer’s business profits - dollar for dollar. In the current scenarios, we are talking about huge amounts of money running into the hundreds of BILLIONs (even possibly TRILLIONs). Each deal/ situation is different and requires the utmost in careful planning and structuring. The corporate tax attorneys and tax accountants will quarterback these plays to maximize the yardage (make that the cash flow) gains for their clients. In this environment, the tax professionals should literally become businesses most intimate and best friends. They will earn every penny of their salaries, fees, and billings by analyzing and maximizing by MEGA MULTIPLES the financial benefits of the consolidated tax return filings. To say the tax laws are complex is a gross understatement, and they keep changing! In my professional career, allowable carry back horizons have been 2, 3, 4, or 5 years while the carry forward horizons have been 7, 10, 15 or 20 years. I’d be willing to bet that the coming Obama Administration and the coming next Congress will change them again before this current calendar year’s business tax returns are due March 15th. The complexity of the acquiree’s NOLs consolidations with the acquirer’s operating taxable income is further complicated when you toss in tax considerations for the respective states. While a number piggy back off of Uncle $ugar’s rules, requirements, and guidelines; the majority of states set their own limitations and carry back/ carry forward horizons. States are hurting financially now and don’t have the luxury of deficit financing like Uncle. Almost all are required by their state constitutions to balance their budgets. Most don’t want to allow carry backs which would require them to refund taxes they have already collected (and spent) with money they don’t have. They also don’t cozy to the idea of limiting their future tax income streams by being overly generous with allowable NOL carry forwards. The implications of potentially lost future tax revenues (not to mention digging into federal and state coffers to underwrite any refunds) of this NOL consolidation time bomb are enormous. I wish I could give you a stadium figure as to how much is on the table with bailout merger/ takeovers already consummated, but I cannot. The information just is simply not publicly out there. (To be continued.) I’m Fred Cederholm and I’ve been thinking. You should be thinking, too. Copyright 2008 Questions, Inc. All rights reserved. Fred Cederholm is a CPA/CFE, a forensic accountant, and writer. He is a graduate of the University of Illinois (B.A., M.A. and M.A.S.). He can be reached at asklet@rochelle.net.
Copyright © 2008 The Baltimore News Network. All rights reserved.
Republication or redistribution of Baltimore Chronicle content is expressly prohibited without their prior written consent. Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own. This story was published on November 17, 2008. |
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