Interesting to see how the election of President Obama triggered a knee jerk reaction among large groups of people who raced to buy ammunition and firearms. Without meaning to, President Obama has been one of the best things to happen to the gun industry in a lot of years.
Gold has been looked at as “the investment” to help one make it through the Depression, survive hyperinflation, and with the price dancing around $1000 these days, the place to go to invest at least for the short term.
What I find funny about all this is that in the long run, food, clothing, shelter and something to keep people healthy will be the things that will matter. We might need guns or rifles to be able to keep these things for ourselves though I don’t see society deteriorating down to tribes of looters running or driving to different cities simply because I think there are a lot more armed people living in America and the world than statistics show.
People who carry weapons legally and those who carry illegally do contribute to a state of mind where everybody tries to respect one another, like the Old West, because they are mutually afraid of getting shot at.
That isn’t a good or bad thing but if people don’t respect each other out of love and will do so out of fear, that is better than nothing.
Will long or short term investments in gold be rewarded? For the short term, you may want to look at getting out of the gold market around year end. If nothing else because traditionally, once the Asian holidays are over, until February when China celebrates their New Year, there isn’t a lot of gold gift giving. In the United States, for one thing, people don’t have a lot of money and lots are out of work.
Would gold honestly be used as something to trade for food? Thinking through logically, it has value because people like the fact that gold “lasts forever” and is shining. If civilization were to fall away, which I doubt will happen or if it will won’t be over night, owning gold is the least thing that I would worry about.
Getting back to the current investment situation, I think that gun manufacturing stocks are going to be cooling down for awhile and gold stocks, funds, mines, etc will peak this month and traditionally start to drop a little. Of course, you, dear reader, will know whether I am right or not over the long haul.
Since I am teaching taxes again, how about a tax question to close out today’s blog entry?
Question from a reader:”I am a police officer and wanted to know if I can deduct ammunition I use to practice with that I use off duty. Nice blog btw. Thanks.”
My answer is that if you are working for a city as a W-2 employee, you can, if you are having enough things to itemize your deductions with, use a Schedule A and the ammunition would go under Unreimbursed Employee Expenses and for the form as of late, it was line 21 on the Sch A but that may be subject to change once the new Schedule As are formalized. In any case that is where it goes.
If you aren’t able to file a Form 2106, and it sounds like you aren’t, don’t forget that you can add anything else that wasn’t reimbursed and related to your work such as recertification for the fire arm, range fees if for the purpose of keeping you certification, unreimbursed physical exams – email in private if you want me to help you with your return and I can examine in detail what you can and cannot take.
What are some examples of unreimbursed expenses?
- Depreciation on a computer or cellular telephone required to do your job.
- Dues to chambers of commerce, professional societies and unions.
- Education that is employment-related.
- Home office or part of your home used regularly and exclusively in your work.
- Job-search expenses in your present occupation.
- Legal fees related to doing or keeping your job.
- Licenses and regulatory fees as well as occupational taxes.
- Malpractice insurance premiums.
- Medical examinations required by an employer.
- Passport for a business trip.
- Subscriptions to professional journals and trade magazines related to your work.
- Tools and supplies used in your work.
- Travel, transportation, entertainment and gift expenses related to your work.
- Work clothes and uniforms, and their upkeep costs.
- Just remember you are subject to the 2% haircut and that your expenses that were unreimbursed have to exceed your adjusted gross income multiplied by two percent.
Example 1: Your Unreimbursed Employee Expenses were $718.
Your AGI was $89,000.
$89,000 x .02 = $1780.
In this example $718 is less than $718 so you wouldn’t get any benefit from this. You would need to break $1780 in order to get the benefit but I always tell clients to put the information in anyways because it may change from year to year, especially if you already are filing a Schedule A. It will only stop mattering if you get capped because of AMT, and that is the topic for an entry for another day!
Be safe people.
Kim Isaac Greenblatt
Guns and Gold etc
Tags: Business, expenses, unreimbursed