Increa Technology |Engineer |Aviator |Educator

Being the season of taxes and college applications, four dilemmas have recently been on my mind.

1. The High School provides an official record saying zero absences. This is required by colleges to compare against the claim on applications. Reality was 5 days of excused absence. So, on the college application, do I write 0 days, or 5 days? Maybe the HS meant un-excused absences? But the admin assistants don’t know — all they know is that this is what the computer spits out. Do I try to get the HS to report a higher number? Do I write a note explaining to the college?
2. The company provides a W-2 saying $1024. Reality is that they paid $1004. Should the higher number be reported to the IRS to avoid an audit? Reporting the true number appears like unreported income to the IRS.
3. The web page or other form asks for my mother’s maiden name. I suspect they’re using this for a financial password, just like everybody else (which sort of negates its secret-ness, by the way). I usually make up mother maiden names like a password. The receptionist confirms that this would be okay. The form has a signature block attesting that everything is true. Is signing a lie?
4. Lastly the FAFSA form asks for state of residency. Researching the EFC actual formulas reveals that this is used to give credit for where you’re living paying state tax. Due to contract jobs and/or military duty, what if I’m paying state taxes where I’m not a resident? How in the world do you complain to nameless FAFSA that the web page entry from says the wrong thing and doesn’t capture the intent of the original formula? In fact, I know government contracting, and highly suspect this was outsourced to a third party, who probably only did management oversight and sub-contracted the actual web page script. This is impenetrable. And, of course, there’s another “sign here and if everything isn’t right, you can go to jail.” Morally, do I answer what the web page asks, or answer what I know the congressional (lawful) intent was?

People often forget time in their analysis of situations. The classic example is that a dollar today isn’t the same as a dollar tomorrow. Most people have that under their belt.

Today, it was my turn to be reminded that playing time like a control variable is often forgotten. Question: When does a self-employed person have to submit SEP contributions to count for any year?

Table 1 on Page 3 of IRS Pub 560, “Retirement Plans for Small Businesses”, indicates contributions have to be done by the due date of the employers tax return — nominally April 15th of any year. That’s where I quit thinking.

In fact, the time can be extended with an arbitrary number of extensions. This gives an investor time to watch the market for the entire tax year, plus nearly the entire year following up until the final extension date that is available.

Sounds good. Personally, I’m not sure I’d be successful timing the market. But I certainly recognize it as a good freedom. Something I totally overlooked by not thinking in the time domain.

Suggestion:

Whenever you have something figured out, for example “Should the kids drive the car?”, “Should I marry John?”, “How many items should I buy?”, “Should I visit my relatives?”, “How much money do I owe?”, remember the question isn’t fully qualified until the time domain is included.