I know, this might not be the most “popular” post, and I’m far from a Mitt Romney fan, believe me. That being said, am I the only one that finds it a bit over the top to criticize him for paying 15% of taxes. He’s not the one that put in place tax incentives and tax breaks. Sure, you could blame him for voting against repealing those tax breaks while being in favor of others. Clearly, guys like him are probably not the ones that should be able to escape tax increases in the coming years.

That being said, if possible, please set aside that part of the debate. Let’s only talk about the fact that there is outrage all over the country over the fact that Mitt Romney has been paying less than 15% of taxes on his income in the past 2 years despite being in that “1% group”.

It’s sad to say but there are countless ways to legally avoid paying taxes. With the internationalization, it is becoming much easier for companies to pay almost no taxes as has been discussed in some of my previous posts. As individuals become richer, their income and tax situation can easily become similar to what companies are able to do. I’m not saying it’s fair but it’s the way things are. Until we admit that fact, we’ll be stuck arguing on details. Are there solutions? Yes. But they’re not easy at all.

Mitt Romney is paying less than 15% on his taxes. What does that prove? That he was smart enough to get help to legally diminish the amount of taxes that he paid.

Wouldn’t You Do The Same?

I mean honestly, if you have 2 stocks, one that pays high dividends and another that will accumulate capital gains, you’d be smart to put the one that pays dividends in a tax deferred account such as a 401K or a RRSP (in Canada). That would be the smart thing to do. Trying to get all possible deductions that you are allowed under the tax code is also SMART.

I mean seriously, when is the last time you passed on a deduction in order to do “your fair share”?

“Yes, But He’s Rich”

That would be the common argument. Sure, Mitt Romney is rich. But chances are that you are also much richer than the average American. At what point should you “stop looking for ways to improve your bottom line”? I’m not talking about acting illegally or anything like that. At what point? When you make $50,000/year? 100K? 200K? $1 million? There is no clear answer of course.

Mitt Romney Has Many Issues To Defend

However, I don’t see paying few taxes as being one of them. It simply proves that he is smart and plays by the rule.

Tax Efficiency Is Too Often Overlooked

I personally think that being tax efficient is critical over time and makes a huge difference. Why so many investors spend tons of time on asset allocation, commissions, fees for funds/ETF’s and other areas without even spending a few hours to optimize their tax expenses blows me away. It can end up making a tremendous difference.

Any thoughts on all of this? Am I way off in your opinion?

Good Saturday to all of you:) I thought the image on the right was a great way to put it. It’s an extremely difficult problem to tackle and clearly not only about changing the government but I thought it was a great simplification:) Here are some of the good reading from the past few days:

-Overconfidence is bad @ DarwinsMoney
-Fee only vs fee based financial advisor @ GoodFinancialCents
-Greece about to officially “default”? @ ZeroHedge
-Asset Protection Strategies @ MoneyCrashers

Dividend Reads

-Solid dividend players with powerful brands @ DividendMonk
-GNV stock analysis @ TheDividendGuyBlog
-Active Dividend Growth Investing @ DividendGrowthInvestor

Tech Readings

-Apple’s impossibly good quarter @ CuriousCat
-Facebook to file for IPO as early as Wednesday? @ TechCrunch
-Big beat by Netflix (NFLX) @  ZeroHedge

With the Super Bowl a few days away, many of us fans are wondering how we would ever pay for Super Bowl tickets. I’m a Colts fan so obviously going to see the Super Bowl in Indianapolis would have been nice, even without those Colts being part of the game. Do you think you could never afford or never want to pay that much for a Super Bowl ticket? How about going for free?

Unfortunately, today’s post is not a happy story, it’s the story from the other end of the table. A friend of mine is a big hockey fan and lives in Montreal. He had bought some Montreal Canadiens tickets at the start of the year under both his name and his wife’s name (there is a limit per person). Unfortunately, for one of those games, he was unable to attend. What to do?

He decided to put those 2 tickets up for sale on eBay, great idea right?

A few days later, some guy bought the tickets for more or less the cost

The buyer then sent the money using Paypal to the seller who then sent away the electronic tickets

The buyer received the tickets and was surprised to see another name on the tickets. The seller confirmed they were right, gave his phone number in case something went wrong (he was going to be near the stadium on that evening)

The game night came and went, without any issues

Then, one week later or so, the buyer contacted the seller saying he had never been able to get in with the tickets, had been refused entry and wanted to a refund. The seller inquired why he did not contact him earlier or why he did not call… The buyer said he had lost the phone number and he had tried to contact him earlier but never gave any proof or explained how it was done.

The seller offered to go with the buyer to the stadium to get some kind of solution (if the ticket had been refused, that was certainly an error)..but the buyer was not interested, he simply wanted his refund

There are probably 2 possible explanations:

#1-The buyer forgot to go to the game and wanted to get a refund

#2-The buyer simply wanted to see a free game

You might think that there is no way that eBay/Paypal would rule in favor of the buyer here right? Wrong.. Since the buyer paid by Credit Card and complained to his credit card issuer, he ended up winning despite proofs of emails sent. Crazy right? It certainly makes me think twice about dealing with eBay again from the seller point of view. What could have been done differently? A few things I guess… But one thing is for sure, my friend ended up losing both his tickets and the money he had made selling the

Investment Opportunities?

I think this is actually another case for Facebook. In an online, virtual world, there are very few ways to verify the identity of someone. Sure, eBay has an online “reputation” score (the buyer had 2) but I think that Facebook will be able to deliver a more “trustable” environment for ecommerce than what currently exists. I still believe in eBay to some extent but I can only imagine that stories like that happen very often and it must be very costly for eBay & Paypal to deal with such issues. That is probably one more reason why eBay’s auction business has taken a back seat in the whole picture.

Disclosure: No current positions on eBay (EBAY)