TH 0 BI G I TH
breast of very breath r is the
yearning to be rich. However,
most people pend the majority
of their walking time and energy
working for someone el in
order to earn j t enough money
to get by. M t woo aspire to
wealth rarely spend time plan­
ning bow to accumulate ubstan­
tiat amoun of money. Most of
us, based on our Qui tian ethic,
are either waiting for J to
come ore we are waiting to hit the
state lottery.
To get rich you need a proper
personal, trategic or business
plan and oomtructive implemen­
tation of it The following repte­
sents a plan for time people who
ate actually seeking wealth:
LEARN. Learning is a pte­
requisite to earning. Edocation
in and of itself bas its own
rewards, but acqming a good
education is also essential for ex­
ploring the marltetplace.
FARN. Barnas much as you
can. but it is what you do with
your � that is important.
If you outgo exceeds your in­
come, this means that your up­
keep can lead to your downfall.
ECONOMIZE. Most
Americans are involved in
economic activity only as con­
sumers.
Most of \B buy goods or ser­
vices to impress or to imitate
otbers. Careful,' effident, and
prudent ise of capital resources
can produce practical finm:ial
significance for the economizer.
DBTROIT, MI - Certain b in
hould be a are that beginnin
February 3, 1992, a new regulation
applie to the requirement to report to
the Internal Revenue Service any
receipt of more than $10000 in b
in one transaction (or two or more
related transactions).
"This requirement is a further at­
tempt to monitor and apprehend the
'underground economy,' which deals
in cash transactions to remain in­
visible to the IRS and other law en­
forcement agencies," aid Bernie
Kent, tax partner at Coopers &
Lybrand's Detroit office. ,
On Friday, Baltimore District
Director Herma Hightower said that
IRS compliance teams will be visit­
ing busines es in the Washington
D.C. area where large cash ale
would most likely occur to review
their records for compliance with the
cash reporting requirement.
The recently-issued regulation ex­
plains the expanded definition of
"cash" contained in the 1990 tax law.
Cash includes cashier's checks, bank
drafts, traveler' checks and money
orders - but only if the insttument
has a face amount of less than
$10,000.
"THE REASON FOR the 'less
than' requirement is that a financial
institution that receives cash for an
instrument in excess of $10,000 al­
ready would have reported the trans­
action," Kent said. "The new rule is
intended to apply where a purchaser
uses currency and/or one or more in­
struments with a face value of less
than $10,000, but the total purchase
price exceeds $10,000."
Checks, other than cashier's
c�ks, are not considered cash UDder
these rules since personal or b\B�
BUSINESS/FINANCE
o ' Land Act
of 1913 and 1936 forced Blac to
a
can be traced through the
sys1em by the IRS.
Bus bleb will be atrcc1Cd
by the e new requirements to
�tallers of consumer durablca uch 0 travel 0
cara or jewelry, aDd retail of arc covered by
collectibles Including tampl, Wblle these pcdflc b arc
artwo etc. targc for compUance under the
ne . ues," id
Benedict. "We thin pplied
cience nd ocial cience can be
cd to under t d th rel tio hip
between how people live d ho
th t ffeets our environment nd
our exi tence.
"We think i ue like tho e in
South Africa need to be trended
to," he aid.
om
DeW la , any b required to
report ucb transactio It It
knowled that tho payer II atempt-
ing to circumvent the b repord
rules.
The requirement that the
IRS will "continue to monito infor­
mation reporting in trades and buIi­
generally, lncludln real
closings and settlements and lDDlIIWo­
do in the bol e trade, 10
mine trends in ooncompliaoce and
ab • If the experience WII'I'IIl
expanded reportln requirements
may be imposed on a prospedi\'e
basil.
This law is designed 10 mate busi­
nesses responsible for reporting lIrF
purchases by criminals. The filing of •
Form 8300, Report of Cash Paymen
Over $10,000 Received in a Trade or
Business, will alen the IRS to lnves­
tigate possible tax evadell.
"This sbould make it more dif­
ficult for sucb people 10 pend their
unreported income without being
'noticed, '" Kent said.
Shoney's, Inc pre .. nted a donation to th NAACP. Pr ent are (I-r) George Carter, deputy dlr ctor
NAACP; Betty Marshan, Shoney'., Inc.; Gw.n Harrl�, Na hvili. Branch, NAACP; Dr. Benjamin
Hooks, L onard H. Rober., chairman and CEO of Shon y'. and J. Howard H nder o�, NAACP.
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Gift Taxes
Q. My wife and I gave our' n-in­
law a new ar that has a retai.l valu�
of $19,000. This is th� only thing
that we: have given him or plan to
givc him this ycar. Do we havc to
pay gift tax on this?
A. The annual �xc1usion gcnerally
allows spou 'C who' consent to
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one or both spouses must file a gift
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ACCUMULATE Buy in
anticipation of current am future
needs am not on impulse.
TQ practice prudent ac­
cumulation is an effective way of
.. consuming aIXl at the same time
: Increase your savings,
SAVE Saving means not
speMinga part ofyour�.
Forming a regular habit of put­
ting away, at 1(31, 10 percent of
income can provide a way to
make your tmney work for you.
1NV}Nf. Investing is an ac­
tivity towant �ing wealth
am net worth. This is a tried­
. am-true American metOOds of
successfully using savings
. productively so that �y can
yield even IOOIt future iIxx>me.
• PRAcnCE
.. CAPITAllSM. Capitalism is
an economic sy tem charac­
terized by private or corporate
ownership of capital goods. This
system is one made up of invest­
ments that are determined by
private decision ratter than by
state, control, and by prices,
production, and the distribution
of goods that are determined
mainly by competition in a free
market. The tru practictng
capitalist will note that mthing is
said here about relying on �
government for its support
aIXl/or haIxlouts.
If you iIivrst in stocks or real
estate you am create a source of
income that pays you each
month, with little effort on your
• part.
Establishing and operating a
business allows you to hire
people and have them work for
you. As an example of � way
that operating a bus� can ac­
quire wealth and fame for you
note that DDt people reading
this ate actually older than mM
or Xerox. However, to open a
b�iness is easy, to keep it open
is the difficult part.
These are typrcal of questions 'tax return. Different rules apply if
asked by taxpayers and are pre- onc or both spouse' are not U.S.
sen ted as a pubuc service of this itizcns.
publication and the IRS.
Q. I made a gift of $II,OUO to my
Q. I recently received a gift of son. Do 1 still have to pay gift tax
$15,OOU. Willi have tp pay federal I I h ..
'" even t ioug 1 t c gIlt was to my
tax on this gift? son?
A. Generally. the donor, whoever ,'1. Yes, You must pay gift tax if
gave you the gift t. has to pay the gift the gift to the individual was more
tax .. H we\e�" It the donor doc!), than $10,000 for (he: year regard­
not pay .the gilt tax, you may have less of whether the indi idual was
to pay It. your son or daughrcr.
Q. I recently gave my daughter-in- Q. I bought a $·12, 00 ring for my
law $9,000 In ash, and lhi!) is the wife. Do I have to pay gift tax even
only gift that I gave her this year. though the gift is for my wife?
Will 1 have t pay gift tax?
A. Generally, the first $10,000 of .-t. If your gift is for your wife, you
gift made to any one person dur- usually would not have to pay any
ing any calendar year is excluded gift ta . Generally, the amount of
from the total amount of gifts that the. n�arital gift. tax exc�usion is
can be taxed for the calendar year. unlimited. Cert�1O exc�ptlons may
0, if you give someone Ie!)::, than. apply to nonresident alien pouses.
$10,000 during the year, you will Q. What form do I usc to file gift
not have to pay gift tax on that gift. tax?
A gift of a future interest cannot b�
�xcludcd under th\! 10,000 annual
exdusion.
.-J. File orm .709, "United States
Gift (and Gcncration- kipping
Transfer) Tax Return," with your
federal income tax return.
•
Michigan
NatioDal
Bank
Q. When mu't I file my gift tax
rcturn? '
A. File Form 709 with your feder­
al income! tax return by April 15 of
the ycar after the year in which you
gav� the gift.
For more information, ordcr the
free IRS Publi ation 44 , FedertJl
EstQIL' and Giji Taxes, by calling
toll-free'l-MOO-TAX-FORM (1-
80 - 29-3676).
\W� doing what it tak