It is easy being Green

My neighborhood Trader Joe's provides every customer who brings in a reusable bag with an entry ticket to a weekly drawing for $25 gift certificates. A few weeks back they counted up the number of entry tickets and it totaled 14,634 in one week!!! That is amazing.

I've been reusing and refusing bags for over 30 years now and I estimate my own savings would be enough to fill a small swimming pool with bags. Just think how much unnecessary packaging could be saved if we all just brought our own bags?

Without knowing the cost of bags I would still estimate Trader Joe's saves at least $1,000 per week when you add in the full cost of ordering, storing and handling new bags compared to when customers bring their own.

My coop makes a contribution to community groups and lets customers vote by placing a bean in a bucket. Both approaches appeal to me a lot better than the old standby of giving the consumer $.05/bag off their total.

It aint easy being Green

I'm trying to locate 9" x 12" and/or 10" x 13" envelopes. I would like to find the highest post-consumer recycled content as possible. I searched and searched and after an hour of searching the best thing I could find were 40% PCW in a natural brown. Where is the market for recycled office supplies and why aren't there more?

My effort to find security envelopes with any recycled content came up empty. Please let me know if you have a source for such items.

It shouldn't be this hard being green. Where are the entrepreneurs to supply this market? Where are the responsible manufacturers? I realize this market is driven by economies of scale which makes it difficult for recycled products to compete with virgin when so many people purchase strictly on price.

Form 1099-Misc due February 2

This is a reminder that 1099s, with a few exceptions, need to be mailed by Monday, February 2nd. Fines for late filing start at $15 per return (if filed within 30 days of the due date) and go up to $50 per return if filed after August 1 or not at all.

Businesses (and non-profits) need to send them to any individual or partnership if you paid them more than $600 during 2008. Professional fees to attorneys, doctors and other professionals are included. Payments to corporations are included only if they are for medical, legal or fishing activities.

You also need to send one if you paid someone more than $10 in royalties.

You can read the more detailed general instructions here or the more abbreviated 1099-Misc instruction here.

Finally, you should have a policy to require your non-corporate vendors to complete a Form W-9 prior to disbursing any payments to them. This will insure you have the required information you need at year end to properly prepare your 1099s. Don't wait until January to start gathering this data.

Dr. King and servant leadership

I attended the 24th annual "Keep Alive The Dream" tribute to Dr. King today hosted by the World Arts Foundation. This is the first time I've attended after listening to the simulcast on KBOO for years. What an inspiring event.

I attended because my friend Sharif Abdullah was getting a Lifetime Achievement Award for his work on peace and dialog. Sharif is an inspiration to me because of his commitment to creating a world that works for all. I too am committed to that goal.

This is a historic day. Barrack Obama and Dr. King both highlighted the importance of service to others if we are going to be great.

Dr. King said "Every man must decide whether he will walk in the light of creative altruism or the darkness of destructive selfishness. This is the judgment. Life's most persistent and urgent question is, What are you doing for others?"

So what are you doing for others?

Transparency and tough decisions

The Bainbridge Graduate Institute recently found it had to cut $1 million from its budget due to declining foundation support in these tough economic times. Rather than approach this problem from a top-down secretive approach, the leadership chose another path. You can hear the short news report here.

What isn't mentioned in the story is how they shared the problem with our entire community (students, faculty, staff, donors, vendors and more). This open process brought forth a ton of great ideas and allowed us to change the budget almost overnight.

Because it was transparent, the buy in and acceptance was unbelievable. We all were saddened by the decisions to cut staff but the open process made it palatable. A closed and secretive process would have created nothing but dissent, distrust and disharmony. Instead we are moving forward leaner and using our creativity to adjust to a new reality.

Perhaps the biggest problem was that the process generated so many good ideas that one could almost become paralyzed with too many options. This was not the case however as we sorted the ideas into a variety of pools opting for the low hanging fruit first before working our way up the tree.

Data security over the internet

Our firm just set up a 128-bit SSL encrypted extranet to store and transmit data. We have a personal and legal commitment to ensure that our clients' data is secure and protected.

I'm sharing this with you because it was just this past summer that I learned that sensitive information in emails, and even attachments to emails, can be stolen as the email passes through the internet. As I understand it, programmers in foreign countries write programs that search email for this data and can extract it when found.

Accordingly, you should never, never include your social security number, bank account info, credit card numbers, passwords, etc. in the body of an email or in an attachment, unless that data is encrypted. When we exchange this type of data with our clients, like a PDF of their tax return, we send them a encrypted link so they can upload and/or download securely.

US tax system not perceived as fair according to report

Yesterday I provided some information from The Tax Institute at H&R Block’s annual survey of taxpayers. The study found that most Americans weren’t very knowledgeable about the tax laws that impact their pocketbook and should inform their financial decisions.

What I didn’t report, and what I found more interesting, was the finding that a whopping 92 percent of those taxpayers surveyed could not describe the U.S. tax system as "very fair." While “very fair” may be a high threshold, it shows me there is a lot of room for improvement since the best tax systems are perceived as fair.

To me, the fairest system is a progressive system with increasing marginal tax rates. Increasing marginal tax rates means that tax rates increase as income increases, but only at the margin. For example, if marginal rates increased every $50,000, then the first $50,000 everyone earns would be taxed the same regardless of total income, while those who made between $50,001 and $100,000 would pay slightly more on that income than on their first $50,000. In this example, the marginal rate would go up until it reaches the maximum rate.

The theory behind this is based on the utility of money. The less money you earn, the more valuable and vital each dollar is to you, while the more you earn decreases the utility of the subsequent dollar. A $1,000 to me and a $1,000 to Bill Gates are two very different amounts.

I’ll continue with this discussion the next time I blog.

Would you pass the tax quiz?

An annual survey conducted by The Tax Institute at H&R Block finds a majority of taxpayers can’t answer even the most basic tax questions correctly according to their press release. Accordingly to Amy McAnarney, Executive Director of the institute, “Americans are failing Taxes 101.” The annual survey asks 1,000 people tax related questions.

Some of the findings:

70 percent said they were not aware of recent legislative changes that could affect their return despite the fact that changes could affect parents, first-time home buyers, long-time homeowners, military personnel, retirees, taxpayers impacted by Alternative Minimum Tax and more.

Nearly 60 percent didn’t know whether a deduction or tax credit trimmed more off the bottom line. (The correct answer is a tax credit.)

78 percent didn’t know what tax bracket they were in. (Knowing your marginal tax rate, including state and local taxes, can be very important when making financial decisions).

You can click through to their press release if you want more of their findings.

I think my key take away is that most Americans need help. Yes, you can do it yourself but are you really prepared to sort through and understand all the complexities?

It is my belief that having a CPA prepare your taxes and assist you with planning is a bit like using a slugger in baseball - They may not get a hit every time but occasionally, they hit it out of the park and that's why you pay them.

TriLibrium website is up

We've been super busy here at TriLibrium and I've had a hard time finding time to blog. I'm sure I'm not the first to find out how challenging it is to sit down and write something interesting and useful on a regular basis.

You may be interested to know that my firm's website (www.TriLibrium.com) is up and running. I invite you to visit and give me feedback.

Also, please let me know if you'd like to see me write about something specific and I'll attempt to address it.

Happy New Years!

We've had an intense winter over the past few weeks here in the Pacific Northwest and I apologize for not writing more often. However, one of my New Year's resolution is to blog more.

Here is to wishing you much success and happiness in 2009.