Tax Law

With the ink barely dry on last year's Tax Reform Act and thousands of homeowners bewildered about their correct mortgage deductions for next April, Congress stepped into the breach last week. The bottom line: You may get still another major change in the federal tax law governing your home mortgage write-offs. Or - if President Reagan does what he vows he'll do - the 1987 tax bill will be vetoed into oblivion, and you'll be stuck with last year's byzantine mortgage rules. Here's a quick overview of what's happening on Capitol Hill, and how it could directly touch you by Thanksgiving: The House Ways and Means Committee's Democratic majority wrote and passed a $12 billion tax bill last week.

This new tax law is a joke, and anyone who's had to struggle with the new W-4 forms knows what I'm talking about. You practically need a Ph.D. in math to figure your new withholding. And then, once you do figure it out, you realize that all that talk about less taxes was a bunch of lies. I say the new tax law is a nasty piece of business, and I say we vote the bums out of office. Patience Merriman Clifton Heights.

Thousands of small-scale real estate investors could be hurt by the elimination of certain tax benefits on installment sales of real estate in the 1986 Tax Reform Act. Though the new federal "installment-sales" rules affect a wide range of business and investment activities beyond real estate, the effect of this may well be most jolting to people who invested in small rental homes, duplexes, condominiums and similar properties. Installment sales are among the most popular techniques of transferring real property in the United States.

With President Reagan's signature still fresh on the new tax-overhaul legislation, legal and accounting experts have already identified a major boon to real estate investors. It is an an investment that: Bypasses the deduction restrictions imposed on limited partnerships and other forms of real estate ownership under the new tax law. Offers tax-sheltered annual income in the 9 to 12 percent-per-year range. Requires you or your spouse to get away to a resort at the beach, on the ski slopes or out in the country periodically.

Besides Richard Flaster's hippos - four ceramic jungle beasts, including three that are nearly life-size, guard the entrance to his office and seven more lounge on his office desk - the Cherry Hill lawyer's passion is tax law. "My family doesn't have any problem thinking of a gift to give me for Father's Day, and they know that no hippo will go unappreciated," said Flaster of the more than 1,400 of the mammals residing in the Cherry Hill law...

Louisa D'Orazio McShea, 51, a housewife and mother who went back to school at age 33 and became a lawyer, died Tuesday of cancer at Thomas Jefferson University Hospital. She was a resident of Washington Crossing. Mrs. McShea, who was born in South Philadelphia and raised in Northeast Philadelphia, graduated from St. Hubert's High School in Torresdale in 1958. She got married in 1961, and devoted herself to raising her two daughters. At age 33, when her daughters were in junior high school, Mrs. McShea decided to go back to school.

The April 15 tax return deadline is a comfortable 71 days away, but tax preparers are bracing for lots of questions from clients confused by tax changes that took effect this year. Some preparers also expect clients to get their finances in order earlier this year so they know how much they owe before the deadline. "People are coming in early," said Susan E. Cohen, a tax manager at Schiffman Hughes in Blue Bell. Cohen said she has received a lot more calls than last year at this time.

Philadelphia Electric Co. customers will get no immediate break on their electricity or gas bills from the recently passed changes in the federal tax law, according to a plan proposed by the utility yesterday. But the State Consumer Advocate challenged the company's calculations, predicting "a major controversy" before the Public Utility Commission. Although regulators and consumer advocates have been predicting a drop in utility bills around the nation as a result of the new tax law, PE officials said yesterday that their company's particular financial circumstances offset the effects of the changes.

Joe Mohen used to feel wanted. Now he says he feels like a leper. Mohen is one of one million high-technology specialists whose livelihood is threatened by the new tax law passed last fall, according to the Technology Consultants National Association. The trade group held a meeting last night at the Dunfey City Line Hotel to discuss ways to change the new law. The law eliminates the independent contractor status that has been used by computer specialists, engineers, systems analysts, designers and drafters, all of whom work for themselves.

It was a $16 million tax problem, and, not surprisingly, David L. Cohen, the mayor's then-chief of staff, found an answer. So large was Cohen's reputation around City Council that the legislative solution he helped put together sailed through City Council last March. But now the city is facing unintended consequences from the bill. A group of powerful banks and trust companies want the Rendell administration and Council to abandon a new personal-property-tax law or face a major exodus to the suburbs of trust accounts that make up an estimated 60 percent of the current tax revenue.

WASHINGTON - The Supreme Court's ruling on the constitutionality of President Obama's health-care overhaul is likely to shake the presidential race in early summer. But the winners in court won't necessarily be the winners in the political arena. No doubt, a decision to throw out the entire law would be a defeat for Obama. His judgment and leadership, even his reputation as a former constitutional-law professor, would be called into question. But it would not spell certain doom for his reelection.

NEW YORK - A few weeks ago, President Obama released a proposal to lower the federal corporate tax rate - a move that on its face would seem to be good news for small businesses. But the president's pitch isn't getting rave reviews. Advocates for small business say the plan would benefit a relatively low number of small companies and leave many business owners with higher tax bills. The proposal, released Feb. 22, calls for the top corporate tax rate to fall from its current 35 percent to 28 percent.

YOU MIGHT expect a lawyer who specialized in such subjects as business, real estate and tax law, estate planning and the like to be a pretty straight-laced guy. Not Bill Copperthwaite. He had that kind of dry sense of humor that sneaks up on you. "You'd be out to dinner three hours later and you'd remember something he said and start laughing," said his son, Bill III. "You'd say, 'That was really funny.' " William H. Copperthwaite Jr., a hardworking lawyer who put in long hours on the job and who had such a phenomenal memory that he knew everybody's birthday, graduation dates and anniversaries, died of a heart attack Tuesday.

Payroll processors watched Congress' debate over extending a payroll-tax cut with frustration, and they were warning companies about the difficulty of implementing a temporary provision passed by the Senate. Payroll companies can react quickly to a yearlong extension for the first paycheck of 2012 or adjust the second paycheck to correct problems, said Pete Isberg, president of the National Payroll Reporting Consortium, an industry group. Payroll providers still do not like a second consecutive year of December tax-law changes or the Senate-backed two-month extension of the tax cut that could create unprecedented complications.

Applaud values Tebow represents Fifty years ago, Denver Broncos quarterback Tim Tebow would have been considered an all-American idol. He's handsome, athletic, religious, and moral. He represents traditional values of personal restraint, selflessness, and love of family and God ("So far, Tebow is defying all the cynics," Dec. 11). Today we live in a society that has been almost completely purged of this image by a boomer generation relentless in its quest to tear down anything that smacks of traditionalism.

IT'S BEEN A long time coming, but a City Council committee yesterday approved two measures that would drastically alter the city's business-tax structure, and Mayor Nutter is on board. Council's Committee on Finance approved a bill introduced by Council members Bill Green and Maria Quinones-Sanchez that would exempt the first $100,000 in business receipts from both gross-receipts and the net-income portions of the tax for all businesses, protecting smaller city-based businesses and startups.

David V. Randall, 86, a partner in the Ballard Spahr law firm who was chairman of the watchdog Committee of Seventy in the 1970s, died Saturday, Oct. 15, of multiple myeloma at Springfield Residences, a retirement community in Wyndmoor. Mr. Randall, born in Danville, Pa., graduated from Wyoming Seminary and earned a bachelor's degree in English at Lehigh University. A 1954 Inquirer article reported that he had been associated with his father "in the operation of coal-mining properties in Lykens, Mahanoy City, and Mount Carmel.

SALMON FISHING in Mongolia? Why not? If the fish were biting, David V. Randall was happy no matter where he was. "It took three planes and a helicopter to get there," said his son, David E. Randall, a frequent fishing companion. There were also fishing jaunts to Labrador, to Mexico, to Montana - wherever there was a swift river and hungry fish. A favorite spot was the Miramichi River, in New Brunswick, where he went at least once a year for salmon. David Randall, a Philadelphia lawyer specializing in tax law, a onetime executive secretary to Gov. George Leader and an author of books ranging from mystery novels to a history of the National Football League, died Saturday after a long illness.

Bernard Wolfman, 87, the University of Pennsylvania Law School dean from 1970 to 1975, died of heart failure Saturday, Aug. 20, while visiting a relative in West Orange, N.J. He resided in Cambridge, Mass. Michael A. Fitts, current Penn Law dean, wrote in an appreciation on the Penn Law website: "For more than 60 years, Bernie was a highly distinguished tax academic and expert - as well as a very loyal Penn alumnus. He will be greatly missed. " Mr. Wolfman went on to be Fessenden Professor of Law at Harvard Law School from 1976 to 2007.

After four days of testimony, it took a federal jury about an hour Monday to convict a dentist who the government said had not filed an accurate tax return since 1992. Richard P. Kaufman, 61, who had a practice in Newtown Square, was immediately incarcerated pending sentencing in November before U.S. District Judge Juan Sanchez. Kaufman faces 33 to 41 months for failing to file tax returns, attempting to obstruct the IRS, and filing false claims. Earlier, he told the jurors that he did not intentionally break the law, and that they had to decide whether "I'm a reasonable man who made some decisions that the government thinks are criminal, despite my thinking that I did the right thing.