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New York Markets After Hours

need to know
Burger King to sell hot dogs starting Feb. 23
What to expect from Whole Foods earnings
US Foods files to go public
Salesforce CEO takes stake in Fitbit
U.S. government runs $55 billion budget surplus

Carly Fiorina drops out of presidential race

Has college financial aid totally backfired?

Private-equity firms now buying back their own shares
Share buyback machine remains in overdrive

A new ‘Harry Potter’ book is coming this summer

What Apple, Amazon and Starbucks have in common

Portland Trail Blazers guards Damian Lillard and C.J. McCollum live with ... mom
Meet the NBA stars who live with their mothers

Musician Lenny Kravitz owned the 19th-century Creole cottage in the French Quarter of New Orleans from 1994 to 2012. It's now back on the market at $1.16 million.

RE/Max N.O. Properties/Mansion Global
A bona fide celebrity abode — believe it or not
London house of the week has spiritual side
S.F. real estate looked like this in 2000, too
San Diego prices sending buyers northward
Location Scouts: Insider intel from top markets

A break for zombie-fighting Amazon developers

REIT bonus targets at heart of Brixmor scandal

Burberry sues, says J.C. Penney copied its designs
NRF expects retail sales to grow 3.1% in 2016

10 essential money questions to ask yourself today

Feds have removed a roadblock to driverless cars

Recipe for less boring Oscar acceptance speeches
Is James Bond’s Pinewood Studios for sale?

Why is everyone freaking out about ‘CoCos’?

If you’re bullish on oil, Chevron and Exxon are buys here
If you’re bullish on oil, these stocks are buys

Social Security in the crosshairs: replacement rates again
Stage is being set for cuts to Social Security

Tricky tax issues you should know about this year

Supreme Court halts Obama’s emissions plan
White House forecasts best growth in years
Obama proposes $4.1 trillion federal budget

Why you should consider retiring abroad
Finding the best places to retire abroad
Expat retirees: How life has turned out

Is it wise to hold on to cash reserves?


IRS says identity thieves breached its systems
How to know if your tax preparer is a crook
Tax software firm warns of data breach
White House's lesson about online security

The 6 Most Shorted NYSE Stocks: Short Sellers Pile on Alcoa, Freeport-McMoRan Again
Short sellers pile on Alcoa, Freeport-McMoRan
24/7 Wall St.: Short sellers retreat from Nasdaq

Cheap oil may make OPEC dominant again
Existential threat to Russians and Saudis: Lynn

Will oil get so cheap, it won’t pay to extract it?


/conga/frontpage.html 367627

Markets »

122.29MDow Volume:
Avg Vol: 130.29M
Unchanged
201
Decliners
3048
Advancers
3255
Price Chg %Chg 1 Day
Range: 1 Day
  • 1 Day
  • 5 Days
  • 1 Month
  • 3 Months
  • 6 Months
  • 1 Year
  • 2 Years
Dow
/quotes/zigman/627449/realtime 15,915 -100 0.62%
Nasdaq
/quotes/zigman/12633936/realtime 4,284 +15 0.35%
S&P 500
/quotes/zigman/3870025/realtime 1,852 0 0.02%
GlobalDow
/quotes/zigman/629063/realtime 2,087 +2 0.11%
Gold
/quotes/zigman/33772884/delayed 1,197 -1 0.10%
Oil
/quotes/zigman/2260836/delayed 27.35 -0.59 2.11%
FTSE 100
/quotes/zigman/3173262/delayed 5,672 +40 0.71%
DAX
/quotes/zigman/2380246/delayed 9,017 +138 1.55%
CAC 40
/quotes/zigman/3173214/delayed 4,061 +64 1.59%
FTSE MIB
/quotes/zigman/1482176/delayed 16,714 +801 5.03%
IBEX 35
/quotes/zigman/2759620/delayed 8,144 +216 2.73%
Stoxx 600
/quotes/zigman/2380150/delayed 315 +6 1.87%
Asia Dow
/quotes/zigman/6959860/realtime 2,454 -17 0.69%
Nikkei 225
/quotes/zigman/5986735/delayed 15,713 -372 2.31%
Hang Seng
/quotes/zigman/2622475/delayed 19,288 +105 0.55%
Shanghai
/quotes/zigman/1859015/delayed 2,763 -18 0.63%
Sensex
/quotes/zigman/1652085/delayed 23,759 -262 1.09%
Singapore
/quotes/zigman/1709939/delayed 2,582 -41 1.57%
Euro
/quotes/zigman/16008136/realtime/sampled 1.13 0.00 0.03%
Yen
/quotes/zigman/16008150/realtime/sampled 113.37 -1.75 1.52%
Pound
/quotes/zigman/16008140/realtime/sampled 1.45 +0.00 0.34%
Australia$
/quotes/zigman/16008115/realtime/sampled 0.71 +0.00 0.42%
DXY Index
/quotes/zigman/1652083/delayed 95.82 -0.24 0.24%
WSJ $ Idx
/quotes/zigman/41508961/realtime 88.89 -0.39 0.44%
U.S. 10yr
/quotes/zigman/15866666/realtime 1.68 -0.05 2.81%
German 10y
/quotes/zigman/15866409/realtime 0.24 +0.01 2.52%
Italy 10yr
/quotes/zigman/15866497/realtime 1.64 -0.04 2.37%
Spain 10yr
/quotes/zigman/15866444/realtime 1.72 -0.06 3.62%
U.K. 10yr
/quotes/zigman/15866328/realtime 1.42 +0.00 0.13%
Japan 10yr
/quotes/zigman/15866525/realtime 0.01 +0.04 165.64%
Crude Oil
/quotes/zigman/2260836/delayed 27 -1 2.11%
Gold
/quotes/zigman/33772884/delayed 1,197 -1 0.10%
Corn
/quotes/zigman/25518691/delayed 360 -1 0.21%
DJIA F
/quotes/zigman/48241424/delayed 15,867 -92 0.58%
S&P F
/quotes/zigman/43106711/delayed 1,847 -1 0.07%
Silver
/quotes/zigman/32655632/delayed 15 0 1.03%

Quotes

Symbol Price Change % Change
FB /quotes/zigman/9962609/composite 101.00 1.46 1.47%
AAPL /quotes/zigman/68270/composite 94.27 -0.72 -0.76%
GOOG /quotes/zigman/59527964/composite 684.12 6.01 0.89%
BAC /quotes/zigman/190927/composite 11.98 -0.22 -1.80%
C /quotes/zigman/5065548/composite 37.41 -0.10 -0.27%
F /quotes/zigman/264304/composite 11.34 -0.01 -0.09%
T /quotes/zigman/398198/composite 36.43 -0.22 -0.60%
BP /quotes/zigman/247026/composite 28.04 -0.31 -1.09%
GE /quotes/zigman/227468/composite 28.30 0.02 0.07%
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Rates »

5 yr CD
1.3%
2 yr CD
0.7%
1 yr CD
0.5%
MMA $10K+
0.2%
MMA $50K+
0.4%

National averages from Bankrate.com

You Don’t Need Another Credit Card, You Need A Better One.
Avg. APR Last Week 6 Months
Low Interest 11.96% 11.96% 11.62%
Business 13.12% 13.12% 12.85%
Student 13.42% 13.42% 13.14%
Balance Transfer 14.35% 14.35% 14.12%
Airline 15.17% 15.17% 15.10%
Cash Back 15.20% 15.26% 15.27%
Reward 15.25% 15.28% 15.14%
Instant Approval 18.02% 18.21% 18.00%
Bad Credit 22.56% 22.88% 22.73%
Source:CreditCards.com

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SmartMoney Blogs

Encore
A blog about living in and planning for retirement

Should ‘the 47%’ pay income taxes? Part 2: Retirement

The main reasons that 47% of households do not pay federal income taxes are provisions in the tax code that (1) provide basic exemptions for subsistence-level income and (2) offer tax expenditures that wipe out any tax liabilities. These provisions mainly benefit senior citizens and low-income families with children, who account for the bulk of the non-tax-paying units.

The implication of some of the ongoing political discussion is that the country would be better off if these provisions were changed and more units paid taxes. My blog post last week concluded that the current treatment of low-income families was probably about right. This blog post focuses on the elderly. It concludes that the current provisions do not make sense on a number of dimensions.

My recommended changes would hurt middle-income households and benefit those with higher incomes. These recommendations, however, should not be considered in isolation but rather as part of some comprehensive tax reform.

Like all taxpayers, the elderly are entitled to a standard deduction and to exemptions. Based on these provisions, a married couple in 2012 faces a filing threshold of $19,500 ($11,900, plus $3,800 multiplied by two). However, a couple in which both individuals are over 65 also receives an additional deduction of $1,150 each, raising the threshold to $21,800. Further, low-income elderly are entitled to a tax credit of $500.

In addition to the extra exemption, Social Security benefits are taxed in a peculiar fashion.  Under current law, individuals with less than $25,000 and married couples with less than $32,000 of “combined income” do not have to pay taxes on their Social Security benefits. (Combined income is adjusted gross income as reported on tax forms, plus nontaxable interest income, plus one half of Social Security benefits.)  Above those thresholds, recipients must pay taxes on up to 50% of their benefits.  If combined income exceeds $34,000 for an individual or $44,000 for a couple, up to 85% of benefits are subject to tax.

It seems to me that the taxation of the income of the elderly has three problems. The first is the additional deduction and the tax credit for those 65 and over. It is hard to justify why the tax thresholds should be higher for the elderly than for the non-elderly and why the elderly are entitled to further reduce their liability with a credit.

The second problem is the thresholds for the taxation of Social Security benefits. These thresholds were introduced as a political compromise in 1983 so that proponents could claim the taxation would not affect low-income households. The existing thresholds cause taxpayers to face very high marginal rates at the point that they enter the taxable zone. The thresholds are not indexed for growth in average wages or even for inflation, so in the future a significantly higher percentage of recipients will be subject to tax. These thresholds should be eliminated.

The third problem is the percentage of benefits subject to taxation. The percentage, which was 50% when first introduced in 1983, was raised to 85% in 1993. The notion was to make the treatment of Social Security benefits conform with the treatment of private pension benefits, where beneficiaries are taxed on the amount by which benefits exceed their own contributions. Social Security estimated that about 85% of the average benefit represents the amount in excess of the workers’ contributions.

In retrospect, this model was not particularly relevant since virtually no contributory defined benefit plans existed in the private sector. A model more consistent with today’s employer-provided pension system is the 401(k). Applying that model to Social Security, the portion of benefits based on the employer’s contribution, which is not taxed initially, should be treated like a conventional 401(k), so its full value would be taxable in retirement. The portion of benefits financed by the employee’s contribution, which comes from after-tax income, should be treated like a Roth 401(k) and be paid tax-free in retirement. Hence, the appropriate portion of taxable Social Security benefits should be 50% for all beneficiaries.

Thus, returning to the original question of whether the elderly should pay more in retirement, my answer is as follows. The low-income elderly should continue to be protected by the standard deduction and exemptions available to all households. No need for the extra deduction or a credit that applies only to the elderly. Such changes would probably move many households from nontaxable to taxable status.  The thresholds for the taxation of Social Security benefits should also be eliminated. Such a change is likely to increase the number of taxable units. Finally, the percentage of benefits taxable should be 50% for all households, having no effect on the number of households paying taxes.

Remember, this discussion considers the taxation of the income of the elderly in isolation. Nothing should be changed based on such a partial analysis. Changes should be made only in the context of comprehensive tax reform that maintains a progressive tax structure.

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About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.

MarketWatch - Stock Market Quotes, Business News, Financial News

New York Markets After Hours

need to know
Burger King to sell hot dogs starting Feb. 23
What to expect from Whole Foods earnings
US Foods files to go public
Salesforce CEO takes stake in Fitbit
U.S. government runs $55 billion budget surplus

Carly Fiorina drops out of presidential race

Has college financial aid totally backfired?

Private-equity firms now buying back their own shares
Share buyback machine remains in overdrive

A new ‘Harry Potter’ book is coming this summer

What Apple, Amazon and Starbucks have in common

Portland Trail Blazers guards Damian Lillard and C.J. McCollum live with ... mom
Meet the NBA stars who live with their mothers

Musician Lenny Kravitz owned the 19th-century Creole cottage in the French Quarter of New Orleans from 1994 to 2012. It's now back on the market at $1.16 million.

RE/Max N.O. Properties/Mansion Global
A bona fide celebrity abode — believe it or not
London house of the week has spiritual side
S.F. real estate looked like this in 2000, too
San Diego prices sending buyers northward
Location Scouts: Insider intel from top markets

A break for zombie-fighting Amazon developers

REIT bonus targets at heart of Brixmor scandal

Burberry sues, says J.C. Penney copied its designs
NRF expects retail sales to grow 3.1% in 2016

10 essential money questions to ask yourself today

Feds have removed a roadblock to driverless cars

Recipe for less boring Oscar acceptance speeches
Is James Bond’s Pinewood Studios for sale?

Why is everyone freaking out about ‘CoCos’?

If you’re bullish on oil, Chevron and Exxon are buys here
If you’re bullish on oil, these stocks are buys

Social Security in the crosshairs: replacement rates again
Stage is being set for cuts to Social Security

Tricky tax issues you should know about this year

Supreme Court halts Obama’s emissions plan
White House forecasts best growth in years
Obama proposes $4.1 trillion federal budget

Why you should consider retiring abroad
Finding the best places to retire abroad
Expat retirees: How life has turned out

Is it wise to hold on to cash reserves?


IRS says identity thieves breached its systems
How to know if your tax preparer is a crook
Tax software firm warns of data breach
White House's lesson about online security

The 6 Most Shorted NYSE Stocks: Short Sellers Pile on Alcoa, Freeport-McMoRan Again
Short sellers pile on Alcoa, Freeport-McMoRan
24/7 Wall St.: Short sellers retreat from Nasdaq

Cheap oil may make OPEC dominant again
Existential threat to Russians and Saudis: Lynn

Will oil get so cheap, it won’t pay to extract it?


/conga/frontpage.html 367627

Markets »

122.29MDow Volume:
Avg Vol: 130.29M
Unchanged
201
Decliners
3048
Advancers
3255
Price Chg %Chg 1 Day
Range: 1 Day
  • 1 Day
  • 5 Days
  • 1 Month
  • 3 Months
  • 6 Months
  • 1 Year
  • 2 Years
Dow
/quotes/zigman/627449/realtime 15,915 -100 0.62%
Nasdaq
/quotes/zigman/12633936/realtime 4,284 +15 0.35%
S&P 500
/quotes/zigman/3870025/realtime 1,852 0 0.02%
GlobalDow
/quotes/zigman/629063/realtime 2,087 +2 0.11%
Gold
/quotes/zigman/33772884/delayed 1,198 -1 0.09%
Oil
/quotes/zigman/2260836/delayed 27.35 -0.59 2.11%
FTSE 100
/quotes/zigman/3173262/delayed 5,672 +40 0.71%
DAX
/quotes/zigman/2380246/delayed 9,017 +138 1.55%
CAC 40
/quotes/zigman/3173214/delayed 4,061 +64 1.59%
FTSE MIB
/quotes/zigman/1482176/delayed 16,714 +801 5.03%
IBEX 35
/quotes/zigman/2759620/delayed 8,144 +216 2.73%
Stoxx 600
/quotes/zigman/2380150/delayed 315 +6 1.87%
Asia Dow
/quotes/zigman/6959860/realtime 2,454 -17 0.69%
Nikkei 225
/quotes/zigman/5986735/delayed 15,713 -372 2.31%
Hang Seng
/quotes/zigman/2622475/delayed 19,288 +105 0.55%
Shanghai
/quotes/zigman/1859015/delayed 2,763 -18 0.63%
Sensex
/quotes/zigman/1652085/delayed 23,759 -262 1.09%
Singapore
/quotes/zigman/1709939/delayed 2,582 -41 1.57%
Euro
/quotes/zigman/16008136/realtime/sampled 1.13 0.00 0.03%
Yen
/quotes/zigman/16008150/realtime/sampled 113.37 -1.76 1.52%
Pound
/quotes/zigman/16008140/realtime/sampled 1.45 +0.00 0.33%
Australia$
/quotes/zigman/16008115/realtime/sampled 0.71 +0.00 0.42%
DXY Index
/quotes/zigman/1652083/delayed 95.81 -0.24 0.25%
WSJ $ Idx
/quotes/zigman/41508961/realtime 88.89 -0.39 0.44%
U.S. 10yr
/quotes/zigman/15866666/realtime 1.68 -0.05 2.91%
German 10y
/quotes/zigman/15866409/realtime 0.24 +0.01 2.52%
Italy 10yr
/quotes/zigman/15866497/realtime 1.64 -0.04 2.37%
Spain 10yr
/quotes/zigman/15866444/realtime 1.72 -0.06 3.62%
U.K. 10yr
/quotes/zigman/15866328/realtime 1.42 +0.00 0.13%
Japan 10yr
/quotes/zigman/15866525/realtime 0.01 +0.04 165.64%
Crude Oil
/quotes/zigman/2260836/delayed 27 -1 2.11%
Gold
/quotes/zigman/33772884/delayed 1,198 -1 0.09%
Corn
/quotes/zigman/25518691/delayed 360 -1 0.21%
DJIA F
/quotes/zigman/48241424/delayed 15,867 -92 0.58%
S&P F
/quotes/zigman/43106711/delayed 1,847 -1 0.07%
Silver
/quotes/zigman/32655632/delayed 15 0 1.03%

Quotes

Symbol Price Change % Change
FB /quotes/zigman/9962609/composite 101.00 1.46 1.47%
AAPL /quotes/zigman/68270/composite 94.27 -0.72 -0.76%
GOOG /quotes/zigman/59527964/composite 684.12 6.01 0.89%
BAC /quotes/zigman/190927/composite 11.98 -0.22 -1.80%
C /quotes/zigman/5065548/composite 37.41 -0.10 -0.27%
F /quotes/zigman/264304/composite 11.34 -0.01 -0.09%
T /quotes/zigman/398198/composite 36.43 -0.22 -0.60%
BP /quotes/zigman/247026/composite 28.04 -0.31 -1.09%
GE /quotes/zigman/227468/composite 28.30 0.02 0.07%
Visit the quote page and your most recently viewed stocks will automatically be displayed here.
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Rates »

5 yr CD
1.3%
2 yr CD
0.7%
1 yr CD
0.5%
MMA $10K+
0.2%
MMA $50K+
0.4%

National averages from Bankrate.com

You Don’t Need Another Credit Card, You Need A Better One.
Avg. APR Last Week 6 Months
Low Interest 11.96% 11.96% 11.62%
Business 13.12% 13.12% 12.85%
Student 13.42% 13.42% 13.14%
Balance Transfer 14.35% 14.35% 14.12%
Airline 15.17% 15.17% 15.10%
Cash Back 15.20% 15.26% 15.27%
Reward 15.25% 15.28% 15.14%
Instant Approval 18.02% 18.21% 18.00%
Bad Credit 22.56% 22.88% 22.73%
Source:CreditCards.com

SPONSORED SECTIONS

Trending Tickers
  • /quotes/zigman/23556538/composite TWTR+4.03%
  • /quotes/zigman/118681/composite TSLA-3.09%
  • /quotes/zigman/20039/composite CSCO-0.62%
  • /quotes/zigman/7619798/composite EXPE+1.85%
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X
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As of July 2, 2013, the SmartMoney content you loved now lives on MarketWatch.

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  • Personalized news and quote email alerts
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