Monday, April 23, 2018

Rethinking Charitable Contributions


If you used to itemize your deductions, last year’s massive tax law changes may affect the optimal way for you to make charitable contributions. Three major modifications in the law are responsible for the changed situation:

(1) The 2018 standard deduction increased substantially. It’s $12,000 single/ $24,000 married, which is significantly higher than in 2017. For those over age 65, the standard deduction increases to $13,600/$26,600 (assuming both members of the couple are over 65).

(2) The deduction for state and local taxes is capped at $10,000, regardless of whether you are single or married (a clear marriage tax penalty in a bill that is otherwise very friendly to families, especially if you have children – go figure).

(3) The provision for Qualified Charitable Distributions (QCDs) was made “permanent” in the new law, meaning taxpayers no longer need to wait until December to find out if Congress will extend the provision.

The combination of (1) and (2) means the standard deduction will now apply to a significant number of individuals who itemized deductions in the past. Charities have their fingers crossed that these people will not reduce their contributions because they have “lost” the deduction for them. It also means that the group of people who benefit from “doubling up” contributions changes.

The “doubling up” strategy involves developing a contribution schedule that crosses two calendar years. If your itemized deductions are less than the new standard deduction but greater than 50% of it, you might benefit by moving all deductions you can from year 1 to year 2 (or vice versa). For example, let’s say you routinely make $10,000 in contributions each year and under the new law that means you will take the standard deduction. Instead, make no contributions in year 1, and on January 1 of year 2, donate the carryover $10,000. Then donate year 2’s $10,000 sometime before the end of the year. If the $20,000 donation is sufficient to allow you to itemize in year 2, then you’ve converted some nondeductible contributions into deductible ones and reduced your overall taxes.

Also effective is delaying optional medical expenses (in standard deduction years) or pushing them forward (in itemizing years). To a lesser extent, timing the payment of real estate taxes or state income taxes might also help.

What’s up with Qualified Charitable Distributions?

Making the QCDs permanent means anyone who must take the Required Minimum Distributions (RMDs) from an IRA and donates to 501(c)(3) organizations might benefit. Once you turn age 70-1/2, current rules on IRAs, 401(k)s and the like require you to take certain minimum annual levels of distributions or pay a huge tax penalty. As with any such distribution, RMDs are taxable to the extent they do not reflect a return of nondeductible contributions.

QCDs apply only to standard IRAs and allow you to DIRECTLY donate up to $100,000 per individual to qualified 501(c)(3) charities and exclude the donation, to the extent it was taxable, from income. What’s the benefit?

(1) If you take the standard deduction, this provision allows you to effectively deduct what would otherwise be nondeductible contributions. A clear win.

(2) Even if you do itemize, making a QCD reduces your adjusted gross income. That reduction may help you avoid the Medicare High-Income Surcharge, possibly reduce the proportion of Social Security benefits that are taxable, and reduce the limit before medical expenses can be deducted.

(3) Because you’ve reached the age requirement for RMDs, you were going to have to take money from your IRA anyway, and this might be the most efficient way to do it.

What are the rules for QCDs?

(1) You must have reached age 70-1/2 before the distribution is made.

(2) It must come from a regular or rollover IRA, not a SEP or Simple IRA in which employer contributions are still being made. They can’t be from a 401(k) or 403(b).

(3) The receiving organization must qualify as a 501(c)(3) organization (not all charitable organizations do, and private foundations and donor-advised funds are not eligible)

(4) The contribution must come directly from the IRA. If you cash out the IRA and make a contribution with those funds, it will not count. Many IRAs offer a check-writing privilege and that technique will work because the check is coming directly from the IRA. Otherwise, you’ll have to donate securities from the IRA.

(5) Had you not used this technique and instead deducted the contribution in the normal manner, it must have been entirely deductible (e.g. you can not receive any benefit from your deduction—so make sure to reject that coffee mug from NPR and turn down those tickets to the charity ball.)

QCD Implications

Since 401(k)s and 403(b)s do not qualify for QCDs, and if you make considerable charitable donations to 501(c)(3) organizations, you can consider rolling over the qualified plan into an IRA to take advantage of the QCDs.

Increasingly, states income taxes use different rules than Federal income tax law. Any analysis of your contribution strategy must include how any change affects your state income tax in addition to the federal effects.

If you are approaching 70-1/2, QCDs are one more thing to think about as you determine whether to take your initial RMD in the year you turn 70-1/2 or wait and take it by April 1 of the following year.

Warning

We’re talking taxes here, and these are my understandings of the rules. I’m not a lawyer or accountant, and I’m not providing any advice. You really must check with your own tax advisor before making any decisions (or make sure to do your homework).

Wednesday, April 4, 2018

A Sense of Place

Clifton Area of Cincinnati, OH

If you are going to be a successful liar, you need a great memory. Lies accumulate over the years, and it takes more and more effort to keep them straight. By the time I started writing the Seamus McCree novels, (Empty Promises is #5), my steel-trap mind was already suspect. I reasoned that if I wrote using settings I knew, it was one less thing I had to worry about remembering. Oh sure, I could have developed a detailed series bible with all the invented places and so forth, but that’s a lot of work—and for me, organization is more a wish than a reality. Since it’s easy to forget where the closets are, I housed characters in residences I used to inhabit.

For Ant Farm and Bad Policy, I gave Seamus my house in the Clifton neighborhood of Cincinnati (but moved it to another street). Uncle Mike, a continuing character, resides in the apartment complex in Waltham, MA where I lived in 1978.

Cabin Fever is set in the Upper Peninsula of Michigan where Seamus happens to have a camp located on the same lake where I have my home. For Empty Promises, I wanted to return to the U.P. and the story was willing. Our place—er Seamus’s place—is fifteen miles from the nearest place you can buy anything. Fourteen of those miles are gravel or dirt roads. Cabin Fever was set in the dead of winter and in that story weather and the gradual movement toward spring were their own character. Empty Promises occurs during summer, and although our place is not as isolated as in winter, it is still remote, which is an important ingredient in the story. And best of all, I don’t have to think about where the doors are or which side of the house has the screened porch.

I’ll be interested to hear in the comments how as readers y’all feel about using real locations for novels. Do you enjoy reading about real places, or would you prefer authors construct their own locations?

This blog was originally published as a guest post for part of the Empty Promises Virtual Book Tour.

Monday, March 26, 2018

My Town and March Madness

The not-so-thriving megalopolis of Amasa, Michigan (where I get my mail) isn’t known for much, but if you are a March Madness fan, you should learn its name and why it’s an important place for the tournaments.

Why, you ask?

From Connor Sports website
Because the basketball game you are enjoying is being played on a floor most likely manufactured in Amasa by Connor Sports. A few years back, the court may have even contained wood from a tree that grew on my property.

Many of you know that my official home is located deep in the woods, fifteen miles north of Amasa. The upcoming Seamus McCree novel, Empty Promises, is set in that locale. My property contains a mixture of maple, birch, hickory, oak, aspen, tamarack, and various conifers. The woods up by us are working woods—much of it is harvested sustainably, although some areas are clearcut. The logging industry plays its part in Empty Promises.

A few years back I selectively cut some hardwoods to enhance the long-term viability of my forest. Most of the wood went to make good-quality magazine paper, but a few sticks (100” logs) went to the Connor Sports mill. Someone, somewhere, may have bounced a basketball off my sugar maple.

The process Connor Sports uses to make a basketball floor is fascinating (and if you’re interested, read on). The “sticks “ are stored in a landing area until they are needed, at which point they are stripped of bark, and a rip saw slices them into boards of specified lengths. Those boards are planed to be exactly 25/32” thick. Any blemishes are cut out (only the whitest of the white wood is used for basketball floors), and after being kiln-dried, the remaining stock is put through machines that convert it to tongue and groove along both its long sides and short ends.

The boards are matched to construct 4’ x 7’ pallets using a staggered brick pattern so two boards don’t end at the same spot. This provides a consistent bounce. The panels also interlock and eventually create a court that, in the case of the men’s Final Four, will be 70’ x 140’ (9,800 sq. ft.). After assembly, they are seal-coated to protect the maple, then the court markings and logos are painted on, and it is seal-coated again.

Board curing over winter to create my hardwood floor

After curing, the court is broken back into pallets and shipped to the location for reassembly. These courts are portable (the typical gym floor is permanently installed), and can be placed over temporary stages built in football stadiums or even over ice rinks! Connor Sports employees supervise the onsite court construction and, in the case of the NCAA tournament, remain on-site throughout the games in case any adjustments are needed.

Once the final whistle blows, championship courts are offered for sale to the winning teams. Sometimes they buy them and install them on campus. Other universities have bought them and sold souvenir pieces to their fans. If the winning team doesn’t buy the court, they are offered for sale to the market.

Seamus played soccer, not basketball, but that won’t stop him from watching the tournament and taking vicarious pleasure in knowing the courts were manufactured in his neck of the woods. And now, you too can ooh and ahh over the court and maybe even win a bet with your friends about where that court came from!

A version of this blog first appeared on Writers Who Kill 3/25/18

Tuesday, March 13, 2018

Choices

With less than three weeks before the official launch of Empty Promises, my life is consumed with marketing efforts. I have blogs to write, interviews to complete, reviews to post. The list is as endless as I want to make it, and therein lies the problem.

I think that the biggest issue I have with the Seamus McCree series is exposure. Goodreads reviews for books in the series average 4.4 out of 5. Except on those days of self-doubt when I’m convinced I can’t write anything more engaging than a grocery list, I realize readers who enjoy my kind of story, enjoy my stories. But only if I can get my books into their hands. And so I search for blogs and reviewers with the right audiences.

So many choices, so many unknowns.

Iceberg off Antarctica in the early morning
One mistake businesses (and writing is most assuredly a business) make in attempting to gain new customers is to neglect their current customers. JC Penney provides a wonderful example unrelated to books. The brand was in difficulty, as were most of its competitors. Their new CEO tried to make the store a “hip” place to shop. Its customer base wanted traditional goods at a fair price. The CEO decided a fair price meant low everyday prices: reduced retail prices, but no more coupons and sales.

The net result was the hipper crowd never thought JC Penney was the place to go, and their loyal customers liked feeling special with coupons and sales events—even if it meant higher list prices and the same net prices. The CEO managed to alienate his base and attract no one to replace it.

The Three Tenors (Chinstrap penguins)
Now, besides writing more great books, how can I keep my fans happy customers? I provide my newsletter subscribers with discounts, free stories, and inside scoops. But I write at the tortoise pace of one book a year. How can I keep fans engaged in between book launches?

It turns out lots of my readers like my photography, especially shots taken while on trips. Since I recently finished an excursion to Antarctica, I’ve been taking time away from what I “should” be doing to promote Empty Promises and, instead, selecting and posting pictures from the Antarctica trip. My approach was to have people take the trip with me by posting a day at a time. (Sometimes with really busy days, I posted morning and afternoon separately.)

Gentoo Penguins in the rain
Antarctica has nothing to do with Empty Promises, which takes place in the Upper Peninsula of Michigan, but I’ve discovered that penguins may be better than cats for getting likes on Facebook. Who knows how I might use that information in the future? Maybe Megan McCree (Seamus’s granddaughter who debuts in Empty Promises) will get a penguin doll for the next book.

That’s the choice I made: share commentary along with a very small subset of the 2,700 pictures I took rather than spending the time on more traditional marketing activities. The “vacation reprise” ended earlier this week, and now I’m full bore on writing interesting blogs. I hope my fans have been entertained and maybe even mentioned my posts to a friend or two and remembered to include the information that I write the Seamus McCree series. Well, that’s my hope anyway.

Readers, do you ever discover an author from an activity divorced from their writing—like, say, Facebook posts about an Antarctica trip? Authors – how do you balance promoting to new audiences with keeping fans happy? 

A version of this blog first appeared 3/12/18 on the Writers Who Kill blog.

Monday, February 26, 2018

A Writer Unplugged


Antarctic Peninsula

Earlier this week we returned from our 23-day journey in and around Antarctica. During that time, I had no access to electronic news feeds. I missed the Super Bowl – although I did hear the score the next day. I missed five shootings in or around schools: Lincoln High School in Philadelphia (1/31), an “unintentional” shooting of two in Sal Castro Middle School in LA (2/1), Oxon Hill High School, Oxon Hill, MD (2/5), the parking lot of Pearl-Cohn High School, Nashville, TN (2/9), and mass murder at Marjory Stoneman Douglas High School, Parkland, FL (2/14). I missed (I think) Congress passing a budget. I returned to find Dreamers are still caught in a nightmare and the Olympics in full swing.

Sheep with Magellanic Penguins on Falkland Islands
Each day, the ship I was on printed a multi-page news summary. It covered the world. Cricket, Tennis, Golf, and English Premier League Football each had more lines of coverage than the two or three allocated daily to US news, which was included under the subhead “The Americas” (lumping our bit of drama with that from the rest of North, Central, and South America).

Striated Caracara - Falkland Islands
While all those events (and much, much more) transpired, I spent oodles of hours on deck watching pelagic birds, cloud patterns, the work of wind on the water. During our numerous landings, we visited new places (Argentina, the Falkland Islands, South Georgia Island, the Antarctic Peninsula and surrounding islands), saw thousands of birds and unique landscapes.

The only time I consciously spent in writerly activities was during one day at sea. The birds had mostly left us, and it rained or drizzled all day. I stayed in my cabin and wrote the drafts of two blogs related to the April 3 release of Empty Promises. I suppose I should also count time I spent talking with fellow passengers about my writing. That should probably be counted as sales activity.

young Black-browed Albatross - Falkland Islands
Life itself is grist for the writer’s mill, and this was an experience unlike any other I have had. The problem is, if you tried to pin me down about what I learned or how I might incorporate something into my writing, I’ll have to admit that I have no clue. Maybe an expression I heard will pop up in a character’s dialogue. Perhaps I’ll describe how one passenger walked using a stabilizing boot on one foot—the way she shifted her body to compensate for the additional weight and bulk, or how she had to navigate the stairways in rolling seas. Wait! Maybe I’ll have a passenger use a fake boot to hoodwink an airport worker into moving her to the head of the customs line.

Or perhaps a character will incorporate some trait I saw a passenger exhibit: how they approached eating each meal, a sideways shift of his eyes when he didn’t agree with a statement but chose not to engage in argument, a chuckle that turned into a giggle that turned into a knee-slapping roar.

Chinstrap Penguin in the Southern Ocean
I’m sure some writers would have recorded everything in a notebook so they could tap those recollections as needed. I am not that kind of writer. I have no patience for that kind of recording. For some time I kept a diary—sort of. A typical entry might read.

Weather good. Beat Olympia 3-2. (Only by the date could I know if this was soccer or baseball!)

King Penguin colony on South Georgia Island
I’d rather experience something than worry about trying to record it. I only take pictures as something of an after-thought. I want to experience the scenery before recording it. I want to watch the bird, how it uses lift from the waves to pop high into the air, how it uses its tail as a braking device, how it hops on the ground kicking over leaves. Oh yes, I like taking bird photographs, but sometimes I forget in the joy of watching them.

Magellanic Penguin
"If I turn my back on you will you stop squeaking?
The trip reminded me how much I enjoy being outdoors and how little I enjoy talking back to politicians on the television when they lie or avoid tackling hard topics. I missed the part of social media that keeps me in touch with friends and acquaintances; I did not miss the part of social media railing against others (regardless of whether I agreed or disagreed with their position).

I could choose to remain a Writer Unplugged. In some ways it would be easier to ignore all that’s wrong with the world and go my merry way without a care. Except, I prefer making decisions based on facts rather than beliefs, and by ignoring injustice, I’d lose the part of my core being that cares about the plight of others.

Cape Petrel in Southern Ocean
So, I shall return to being a Plugged-In Writer but commit to controlling how I gather news and interact with others about interpreting it. I shall not allow it to regain control of my time or my energy.

Oh, and so I don’t leave you with any false impressions, let me confess: I did manage to take 2,740 non-blurry pictures during the trip. How about you—what’s your biggest take-away from your latest trip or vacation?

This blog was originally posted on Writers Who Kill (2/25/18).



P.S.  I am posting photos and commentary of this trip on Facebook, as though you were traveling with me with a 20-day delay. You can follow me on Facebook at  https://www.facebook.com/james.m.jackson.author Be sure to check the Album as well as the daily posts. ~ Jim

Tuesday, January 30, 2018

Parting is Such Sweet Sorrow

Later today I begin the Great Antarctica Adventure. I’ve read all the preparatory material—at least twice. My camera equipment is packed. Batteries charged. Clothing checked against my master list and set aside. Bird books studied. Google translate loaded onto phone (to make up for my nonexistent Spanish skills). Twenty-five days’ worth of medicine set aside. Passport and cash in wallet. Boarding tickets printed out.


I’m ready to go, already . . . except for one thing. I’m not ready to give up my connection to the internet. We’ll probably have internet access in airports and hotels, but for the nineteen days we are on the ship, it is unavailable—at least at a price I want to think about.

I’ve been working on curbing my obsession to the news of the moment. That’s gone about as well as when I tried to quit smoking by gradually cutting down. Something would happen and poof (or puff), I’d be back at my two-pack a day habit. I’m wondering if constant irritation over the news isn’t as dangerous as my smoking habit was. So, I’m going cold turkey. If there’s a newspaper available at port stops, I’ll catch up, but no more checking eighty-seven times a day to see what . . .well, you fill in the blank; I’d just get upset again.

I’m giving up Facebook, too, but only for the trip. I’ll go missing to my 886 friends (as of this writing), and they will go missing to me. I won’t experience three and a half weeks of their lives, because—and I’m just being honest here—I’m not going to check my friends’ back posts when I return. That admission may even cost me a few friends. You mean I don’t care enough about them and their cat Fluffy that I won’t check out each cat shot, each annoying GIF, each political rant. Yep, and I won’t be able to celebrate your book launch or new grandchild, either. When I return to Facebook, it might be like reading a Russian novel and discovering six pages from the middle are missing. I’ll just plow ahead. I’ll miss about 0.08% of each person’s total life. Sure, some important things will happen, but not many—the effect over my total friends is about 2/3rds of one life.

Admit it—you won’t miss my occasional math-geek or writer-geek post, either. Maybe I’ll schedule one or two, just to remind everyone I’m still alive. I have a Writers Who Kill blog due while I’m traveling, and I turned that in ahead of time.

I won’t waste a second mourning the loss of not having access to my Twitter feed.

Email is something else. I remember when all important communications were delivered by the US Postal Service. Back in those distant times, it might take a week or more for a letter to move from sender to receiver. Only businesses used express mail, and faxes were of low quality, slow (two pages a minute) and were sent over long-distance lines you had to pay for by the minute. Oh, and remember telegrams, with their pre-Twitter form of clipped communication as every letter was expensive. STOP.

I’m a writer – what will happen if an agent or publisher wants to contact me? Or a book club wants to schedule me for a meeting? Or someone wants to buy a signed paperback? I’ll employ an automatic responder: “Sorry, it will take me some time to respond to your email. I’m traveling to Antarctica. Be back on 2/22.” Actually, I won't. Turns out my email program (Thunderbird) doesn't have a way to do that and anyone who writes a message to an account with @jamesmjackson.com will hear nothing from me until I return.

That reminds me of the time my boss insisted he have a way to contact me while I was on vacation. I was whitewater rafting down the canyons of the Green and Colorado rivers. I thought a while and then told him that I supposed he could hire a helicopter rescue company to track down our raft and airlift me from the sandbar or beach we camped at that night.

Today, however, we’re used to being connected 24/7. One might still be forgiven for not answering an email for a day or two if you’d just had quadruple bypass surgery, but otherwise, we expect immediate responses. Well, that just isn’t going to happen. Unlike my days working for corporations where there was someone to back me up, I’m a sole proprietor. It’s me or it’s not.

If that costs me some book sales, so be it. I’m confident the potential loss won’t cause me any sleepless nights or worrisome days. To find out, you’ll have to wait for my return.

A version of this blog first appeared on the Writers Who Kill blog on 1/28/18.

Monday, January 15, 2018

Bucket Lists

In 46 B.C. Julius Caesar did away with a flawed lunar-based calendar and introduced the Julian calendar, based (as the Egyptians had been doing for a very long time) on a solar year. He didn’t get it quite right, which required the change over 1,600 years later to our current Gregorian calendar. All of which is to say that we should blame Caesar for having to start anew during the days of shortest daylight hours instead of (say) near the vernal equinox.

I didn’t find anything that linked Caesar to the common practice of setting (and mostly ignoring) New Year’s Resolutions. For a time, I tried to be a maverick and set goals commencing on my birthday. That didn’t seem to work any better, and since the IRS insists that I use a calendar-year basis for my personal and business taxes, I’ve reverted to calendar-year based goals. And lists.

I’ve mentioned before that I am a person who keeps lists. Lots of lists, but fewer than there used to be. I still maintain my books read (80 for 2017). It has the practical purpose of answering the question: did I already read this? I also maintain a lifetime bird list, but I’ve discarded the practice of keeping track of the number seen each year, and in each state, and on my property, and . . . I no longer care.

One list I continue to maintain has nothing to do with calendar years; it’s a bucket list. In case you are not familiar with the term, it means a list of things you want to do or experience before you die (or “kick the bucket”).

My bucket list has changed over the years. Some things have come off because I completed them. My trip to Alaska in 2008 completed my objective to visit all 50 states. And in 2014 when we visited Newfoundland/Labrador, I finished off my Canadian providences list. (I still hope to visit all the Canadian territories, and that remains on my bucket list.)

I consider my list as a way to remind me of some of my inspirational goals, but I don’t allow it to exert pressure on me. (You’re past Social Security eligibility age and you still haven’t done that? Shame, Jim!) Over the years, I removed some items from the list because they are no longer possible to do, at least in the way first intended. I had to scratch “Hike the Appalachian Trail” when my shoulders deteriorated to the point it was too painful to carry a heavy pack for a full day, let alone three months.

I’ve flown in a hot air balloon and helicopter, but still want to fly in a glider plane during hawk migration. I’ve been to the Arctic, but not to Antarctica—that is about to be rectified.

We’ve booked passage on a birding tour that will take us to the Falkland Islands, South Georgia Island, and the Antarctica peninsula. We leave at the end of January and will be gone for three-plus weeks. I can’t wait to experience the remote habitats, see birds I have only visited in zoos, and experience—well, who knows exactly what I’ll experience? That’s why I’m going.

What’s on your bucket list and what do you hope to scratch off this year? (Oh, oh – there’s that calendar year thing raising its head again!)

~ Jim

Originally published on Writers Who Kill Blog 1/14/18