New investment affiliation
Tax Tip of the Week
Disaster relief distributions
Charitable donations
Certified?
A "heads-up" for you
Inflation protected "I" bonds
New employee/contractor reporting

Our best wishes to you and your family for a happy, healthy, and prosperous New Year.

The events of September 11 have left an indelible mark on our minds, our hearts, and our national psyche. As minor as it may seem in light of the tremendous human tragedy, the attacks also left a mark on our portfolios, and changed the investment landscape as we once knew it. Given the profession we find ourselves in, I may be able help you examine with clear heads, the new lay of the land. Call me for a financial interview or a portfolio update.

I have changed my broker/dealer affiliation to SunAmerica Securities, Inc. (Phoenix, Arizona). My local contacts and back-office staff are still in neighboring Braintree, Massachusetts allowing me the ease of personal contact and back office support for your investment portfolio, employee benefit and personal insurance needs.

Given SunAmerica's multi-million dollar advertising campaign, it is hardly my job to explain who my new broker/dealer is. SunAmerica has clearly positioned itself as "The Retirement Specialist," and though that tag line is inclusive of a broad array of SunAmerica companies and their many products, it generally reflects positively on you. Their state-of-the-art Vision20/20 system allows you to track your holdings so that you always know what is occurring within your accounts.

Through my local Braintree contact, we have associated with SEI Investments, who provide world-class, scalable asset management services as part of an asset management offering. I am very impressed with the unique, disciplined approach SEI uses to achieve investment goals and true diversification for my clients, and we will use them as our core platform for clients willing to liquidate existing holdings to achieve long-term investment objectives. We will also continue to manage assets for clients who may not wish to liquidate existing assets due to tax consequences or emotional attachments to existing holdings (inherited securities, loyalty to employer, etc).

Additionally, we have associated with Employee Benefit Source (EBS), a specialist and true consultant in employee benefit and retirement plans. EBS is intimately familiar with all the carriers and plans that service the Northeast region. Their objective is to assist employers in finding the best solution that meets the employer's goals for offering retirement and benefit plans. They then review those goals on an annual basis to ensure that the goals and selected plans are still aligned and continuing to offer the best value available in the market. EBS and I can help you address one of the fastest escalating cost items within your budget.

These are just a few of the many features I can bring to your table to offer you first-class brokerage and investment management services.

I am now writing TAX TIP OF THE WEEK that is distributed over the Internet to a select list of people each week. Items may also appear in the printed monthly version. If you would like to be included in the weekly electronic distribution, just send me your e-mail address with the subject of: "TTW subscribe" and include your name, city, and state of residence in the content of the message.

Several charities have raised questions about the practical application of existing legal standards for distributing funds to victims of the September 11 terrorist attacks against the United States. The Internal Revenue Service recognizes the unique circumstances caused by this tragedy and wishes to alleviate concerns that might otherwise delay relief to victims.

Congress is currently considering clarifying legislation in this area. While Congress is considering legislation, the Service recognizes the need to provide interim guidance to charities regarding payments made by reason of the death, injury or wounding of an individual incurred as a result of the September 11, 2001 terrorist attacks against the United States.

Accordingly, the Service will treat such payments made by a charity to individuals and their families as related to the charity's exempt purpose provided that the payments are made in good faith using objective standards.

This administrative treatment will continue to apply to any payments made to such individuals before the earlier of final legislative action addressing these issues or December 31, 2002. The Service will consider what, if any, additional guidance is needed in this area.

Organizations that have questions concerning this notice may contact Marvin Friedlander, Tax Exempt and Government Entities (TE/GE), at (202) 283-2300 (not a toll free number).

New 9/11 Charitable Organizations:
The IRS Web site offers an up-to-date list of organizations that have been formed to help the victims of the September 11 terrorist attacks. The IRS has granted tax-exempt status to these organizations and contributions to them are tax deductible.

The most current list can be found at: http://www.irs.gov/prod/bus_info/eo/sep11.html

The public can also find out whether a particular organization has been recognized by the Service as eligible to receive tax-deductible contributions by calling the IRS Exempt Organization toll-free phone number at 1-877-829-5500.

The Internal Revenue Service requires certain substantiation to support charitable donations in excess of $250.00.

In those cases, if not already issued, the recipient charity must send the donor an acknowledgement of receipt of the donation, and must include a statement of the amount contributed and "whether or not the organization gave the taxpayer any goods or services as a result of the donation (other than certain token items and membership benefits)" and if goods or services were given, a description and good-faith estimate of the value of the goods or services.

This acknowledgement must be received on or before the earlier of (1) the date the taxpayer files a return for the year of the donations, or (2) the due date, including extensions, for filing the return.

Generally, a charity must give a donor a written statement for a donation of $75.00 or more that involves a benefit. The statement must include the amount of the donation as well as inform the donor that only the amount in excess of the value of the goods or services is deductible. The statement must include a good-faith estimate of the value of the benefit.

Your doctor is certified.
Your lawyer is certified.
Is your accountant certified?

If your accountant isn't a Certified Public Accountant, think twice about where you are getting your advice. Who do you want handling your financial and business matters?

If your accountant isn't a CPA, it's time to seek professional help.

Planning for the future is a lot like planting a tree. You've got to do it today if you want your family to enjoy it tomorrow.

The "toner phoners" have moved into a new area. Now they are trying to sell retailers large orders of cash register tapes or cases of credit card supplies.

You know the "toner phoners?" Those are the people that used to call to confirm your order for toner, or ask you what kind of copier you are using. Several weeks later you end up with a LARGE shipment of high priced toner cartridges or cases of inferior paper with COD collect payment terms.

If you ask any questions, they are usually very rude and just hang up. Hmm, look at the advantages of caller ID boxes, huh?

DON'T FORGET: IT'S NOT WHAT YOU MAKE THAT COUNTS; IT'S WHAT YOU KEEP!

"I" BONDS have built-in inflation protection. "I" BONDS purchased from May though October 2001 earned 5.92% interest vs. 4.5% for the traditional EE Savings Bond. Unlike Savings Bonds, which are sold at half their face value, "I" BONDS are sold at full face value. They earn interest for 30 years, but can be cashed in after 5 years without a penalty. If you cash in an "I" BOND before 5 years, you will forfeit 3 months of interest.

Like regular Savings Bonds, "I" BONDS are exempt from state and local tax. Federal taxes can be deferred until the bonds mature or are cashed in.

"I" BOND earnings are based upon two interest rates: a fixed rate of return for the life of the bond and a variable rate based on inflation that is credited every six months. The fixed rate is 3%.

"I" BONDS can be purchased at most local banks. Denominations start at $50 and go up to $10,000. Investors can purchase up to $30,000 in "I" BONDS each year.

To get more information about "I" BONDS, go to www.savingsbonds.gov.

If you are pleased with our services, please tell others. If you are not pleased with our service, please tell us; that way we can please you.

Roger A. Kahan is a Certified Public Accountant, Business Advisor, and Wealth Care Professional with an office in Randolph, serving the tax and financial needs of individuals and small to medium sized businesses almost anywhere in the United States. And with the advent of the Internet, professional consultation extends to several other countries. Roger is always seeking additional clients and professionals wishing to save money and better manage their own, a friend, a relative, or a client's personal or business life. Do you know of someone that could use our professional services? Please let us know if we can use your name in an introductory letter. Thank you.