On 14 MAY, the Bureau of Labor Statistics at www.bls.gov/cpi announced the APR 08 monthly Consumer Price Index (CPI), which is the metric used to calculate the annual cost-of-living adjustment (COLA) for military retired pay, VA disability compensation, survivor annuities, and Social Security. The CPI jumped 0.7% over March’s value. The CPI-W for April is 210.698. That puts cumulative inflation at 3.5% above the 2007 third quarter average base index of 203.6. The COLA will be even higher if inflation goes up between now and 30 SEP. About one in every six Americans - millions of former feds, ex-military and people on Social Security - will get the JAN 09 COLA. It’s automatic. Congress and the White House don’t have to do anything to implement it. And, because Social Security is the dangerous third rail of American politics, Congress and the White House know better than to touch it. The majority of federal retirees are under the old Civil Service Retirement System. They will get the full COLA regardless of their age. Retirees who are under the FERS retirement system get one percentage point less than the full COLA and they don’t qualify for it until they are age 62 or older. MAY’s consumer price indices will be released on 13 JUN 08. [Source: NARFE Legislative Update 629 dtd 16 May 08 ++]

Bookmark TO:

On 15 MAY Senator Daniel K. Akaka (D-HI) invoked his oversight authority as Chairman of the Veterans’ Affairs Committee to formally request data from VA on veterans’ suicides that is not otherwise available to the Congress. In a letter to Veterans Affairs Secretary James Peake, Akaka stressed the need for full and accurate data on the issue. In his letter, Akaka specifically requested the following from Secretary Peake:

Read the rest of this entry »

Bookmark TO:

Clarification for tax filers who are using Taxpayer Identification Numbers (ITIN) vice Social Security numbers on their 1040 & 1040A tax forms for their spouse or children is provided in the below taken from the IRS website. Bottom line if your spouse does not have a SSN and you file jointly using his/her ITIN neither of you will receive a ECS payment. If you both have SSNs and your child does not you will receive your ECS payment but nothing for the child:

Read the rest of this entry »

Bookmark TO:

For years seniors have been getting by on Social Security benefits with a very small Cost-of-Living-Adjustment (COLA). The Senior Citizens League (TSCL) recently released a study that puts real numbers of the loss of buying power they are facing. This study shows that, from 2000 through 2008 alone, Medicare Part B premiums have increased 112%, and that prescription drugs have increased 49%. Concurrently seniors are facing cost increases in basic groceries like milk and eggs. Meanwhile, their Social Security benefits have increased only 24%. The study shows they have lost 51% of their buying power just since 2000. Clearly, the Social Security COLA is not keeping up with inflation, which is what it was intended to do. One primary reason is that the current COLA is based on a market basket of goods typically purchased by younger wage earners, called the Consumer Price Index for Wage Earners (CPI-W). As a result, Social Security beneficiaries received a 2.3% increase in benefits for 2008.

Read the rest of this entry »

Bookmark TO:

Most Tricare users are aware that Tricare by law is always the last payer over any other type of medial care insurance (including Medicare) that a user has. However, this does not apply to Medicaid. Medicaid is essentially a welfare program, providing medical benefits for people under various state welfare programs (such as Aid to Families with Dependent Children) or who qualify by reason of being determined to be “medically indigent” based on a means test. Congress enacted P.L. 97-377 with the intent that no class of Tricare beneficiary should have to resort to welfare programs; therefore, Medicaid was exempted from these double coverage provisions. Whenever a Tricare beneficiary is also eligible for Medicaid, Tricare is always the primary payer. Medicaid can supplement Tricare. [Source: Washington Times Sgt Shaft article 19 May 08 ++]

Bookmark TO:

The House with a vote of 416-0 passed a bill 21 MAY that would authorize the Veterans Affairs Department to pay for major medical facility construction projects and leases in fiscal 2009.”

Read the rest of this entry »

Bookmark TO:

Section 644 of the 2008 National Defense Authorization Act (NDAA) authorizes a Special Survivor Indemnity Allowance (SSDI) for person affected by required SBP annuity offset for Dependency and Indemnity Compensation (DIC). This includes Guard/Reserve retirees who died before age 60. The service secretary concerned shall pay SSDI to the surviving spouse/former spouse if the surviving spouse/former spouse is entitled to DIC and is eligible to receive an annuity by reason of an election of SBP who, except for the DIC offset, would be eligible to receive the annuity, shall be paid the monthly amount equal to:

Read the rest of this entry »

Bookmark TO:

Following are the numbers of veterans, children, parents, and surviving spouses on the U.S. Veterans and Dependents Benefits Rolls as of SEP 07:

Read the rest of this entry »

Bookmark TO:

On 21 MAY, the House passed the Veterans Emergency Care Fairness Act of 2007 (H.R.3819) by a vote of 412-0. The ball now has been passed to the Senate under a companion bill S.2142 introduced by Senator Sherrod Brown. Currently, when a veteran needs emergency medical treatment, the VA allows that veteran to go to the nearest private or community hospital. Once the veteran is stabilized, the veteran must then be transferred to a VA hospital for any necessary continued care. A problem arises when there is a wait for a bed in a VA hospital. The law does not require the VA to reimburse the hospital for the care given after the point of stabilization. S.2142/HR 3819 simply closes that loophole and requires the VA to reimburse the private hospital for care. In rural areas, the problem with the current law is particularly pronounced. Often, a patient may be deemed stable but is not necessarily stable enough to make ambulance trips traveling long distances. More specifically, the Veterans Emergency Care Fairness Act:

Read the rest of this entry »

Bookmark TO:

For American expatriates, the tax filing deadline this year is 16 June. This means that the tax return must be at the IRS Service Centre in Austin, Texas by the due date. Postmarks do not count. For this reason, electronic filing is the better option over snail mailing. The due date can be extended by filing Form 4868 - Application for Automatic Extension Of Time to File U.S. Individual Income Tax Return. This form extends the due date to 15 OCT 08. However you will owe interest on any unpaid taxes that were due 14 APR for the 2007 calendar year. IRS may also assess a late payment penalty of 1/2 of 1% of any tax not paid by the regular due date up to 25%. A late filing penalty of 5% per month up to 25% can also be assessed if the return is filed late. Form 4868 can either be filed electronically or by post. Expatriates making a payment with the Form should send to the IRS Service Centre at: PO Box 660575, Dallas TX 75266-0575. Those not making a payment can send to: Austin, TX 73301-0215. [Source: The Tax Barron Jun/Jul 08 ++]

IRS STATUTE OF LIMITATIONS: Often American expatriates do not file a US tax return under several mistaken assumptions. The three main ones are:

• They file and pay taxes to a foreign country of residence.

• They earn less than the foreign earned income exclusion.

• After many years of not filing to remain under the radar.

Actually US tax laws require US citizens and resident aliens to report their worldwide income annually unless their income is below the combination of a Standard Deduction and Exemption amounts. In 2007 a Single filer’s Standard Deduction was $5,350 and Exemption $3,400. So unless as a Single filer you were below this $8,750 ($5,350 + $3,400) threshold, filing an income tax return in a foreign country does not excuse you from filing stateside. The Foreign Earned Income Exclusion (FEIE), worth $85,700 in 2007, is intended to help US filers from being taxed twice on their foreign income. But FEIE cannot be applied against investment and other forms of income. Nor can it be taken if IRS challenges a nonfiler to report prior year foreign earnings and decides against allowing FEIE. So even if those foreign earnings are excluded from US taxation, they are still reportable. Staying under the radar is risky, especially as IRS is steadily increasing its reach via international tax treaties and auditors. The worst scenario is to be discovered and face possible criminal sanctions for tax avoidance.

Under IRS Statute of Limitations, taxpayers have three years to claim a tax refund. IRS has three years to audit a tax return or assess additional taxes. And ten years to collect outstanding tax liabilities. Anyone who has not filed a US tax return for some years from overseas should take the offensive approach by filing rather than being put on the defensive by an aggressive and suspicious IRS auditor. The Service asks that three years returns be filed. [Source: The Tax Barron Jun/Jul 08 ++]

Bookmark TO: