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Show Page Utah Farm Bureau News Qualified Pension Trust Plan by Junior Stewart CLU Definition'of a Qualified Pension Trust Plan A. A pension trust fund is a sum as of money set aside in a trust to be I. THE PROPERTY TAX IS UNDER ATTACK. This tax has never been popular but now everyone seems to be taking pot shots at it. The assault started when the Serrano case in California clouded the use of property taxes for school purposes. Opponents of the tax want it scrapped and replaced with higher state and federal taxes. They suggest a national sales tax, VAT, be passed to take the pressure off local school property taxes. NEVER BEFORE HAS THERE BEEN a greater need to understand the property tax, who districts such cemeteries, water, sewer, used to purchase systematic Special mosquito, etc., spent $7 million, or percent of the total. The bulk of the property taxes, $104 million, or 62 percent last was year, spent by the school districts. Salt Lake County taxpayers paid $93 million in property taxes to the County Treasurer. $55 million of this was turned over to Granite, Jordan, Murray, and Salt Lake City School Districts. WHO PAYS PROPERTY, 4 for the retirement of and employees of a close or regular corporation. Funds may be set aside in a trust under two arrangements. payments owner-employe- es to the corporation as it enters into this program. 1. Contributions placed into the fund are non taxable in the year in which they are contributed. Hence, corporations may substantially reduce their tax liability annually be effecting such a program. 2. This plan will provide a predetermined retirement program for employees. A savings from 20 to 50 percent on an employees retirement program may be realized by the corporation depending upon the bracket in the possibility of retaining such employees. B. Benefits to the employee 1. A systematic predetermined retirement program. Contributions which are non taxable to him in the year in which they are made by the corporation. Retirement benefits received by the employee are taxed as income to the employee as they are withdrawn. The tax on retirement benefits from the pension fund would be drastically reduced at retirement because of the reduced earned income definite retirement payment received by the employee because may be predetermined for each which it is taxed. 3. Life insurance may be of his unemployment due to employee and the corporation may bracket than if he were still emcontribute on an annual basis that provided in the plan. Contributions to amomt which would be required made for life insurance on an ployed 2. Disability and' hospital provide payment upon retirement employee can be made tax benefits will not be taxed at any of the employee. Retirement deductible to the corporation. to time the employee. TAXES? In 1971, 52.3 percent, or payments to the employee may be Contributions for life insurance for 3. The cost of pure term in$87.7 million of the $168 million made on a monthly or annual an employee will be taxable to the total was paid by business and basis. employee in the year in which they surance would be the only income included in the employees gross industrial taxpayers. 34.5 percent 2. A corporation may make are contributed. spends it, who pays it, and how it or income for life insurance. Death 4. Contributions made by the $57.9 million was paid by the contributions on what is called a works. from the plan would not SPENDS WHO THE home owner. Agricultural tax- money purchase plan which means corporation for an employee on proceeds be taxable to the employees disability and hospitalization inPROPERTY TAX DOLLAR? payers paid 5 percent, or $8.5 that the corporation may determillion and motor vehicle owners mine that a contribution will be surance are tax deductible to the beneficiary as income. It could be Many believe that because county made by means of a specified corporation. Benefits received by included in his estate for estate tax assessors value all property and paid 72 percent or $12 million. percentage of each employees the employee for disability or purposes, although even this the county sends out the tax notices HOW DO PROPERTY TAXES salary being placed into the trust hospital care are not taxable to the problem could be eliminated. in November, county officials set WORK? Assessments are made as 4. A satisfied employee because fund. employee. all levies and, therefore, should be of January 1 each year, and notices of the additional predetermined Pen5. II. of to be need Qualified Only key employees Advantages blamed for all increases. This is are sent out in May. Levies are set benefits. to sion Trust Plan the corporation covered under this plan. This helps not how it works. in August against these valuations to the employees. to retain the more valuable emand (To be concluded next issue!) Every taxing jurisdiction which determine the tax liability A. There are several advantages as benefits added enhances ployees becomes determines its own levy according which delinquent 1 mill equals one to its own budget needs and November 30th. dollar in taxes for limitations. The each $1,000 of county statutory acts only as a billing and collection assessed valuations. Therefore, a home with an assessed value of agency. market value of TOTAL UTAH PROPERTY $4,000 (fair TAXES charged in 1971 were $168 $20,000) and a levy of 100 mills million. Of this, counties spent $35 would pay taxes of $400. We hear the charge, million, or 21 percent. Cities and My towns were responsible for $21 property taxes are too high and ' million, or 13 percent of the total. there is nothing I can do about If your property is being assessed higher than 20 percent of its fair market value, taxpayers can appeal to their county Board of Equalization. They can use the State Tax Commission as a board of appeal if they feel it is necessary. At the Summer Conference HAVE YOUR PROPERTY LeGrand Jarman, Director of TAXES climbed as fast as other Field Services explained the value Are taxes? your property taxes of service programs and the structure that should be followed to paying for the huge increases in render to Farm Bureau members a government spending? We do not believe they are. The collection desirable service. Mr. Jarman IFA CHAMPION stated in millions of stated that membership in Farm figures below out. will this bare The finest complete feed pellets for prize Bureau is worth all it costs. It is dollars, 1961 1971 Increase from membership dues that funds horses. Rich in vitamins, extraction of Taxes $94 $168 79 A become available to finance Farm Property & Individual oats balanced with other grains and alfalfa. Corporate Bureau programs, without which lbs. per cwt. of Recommended ration 1- -1 there would be no such programs. It is apparent that many horse. members may appreciate the organization but will not pay their THIS SHOWS THAT SINCE 1961 $3.65 cwt. bulk $4.00 cwt. bagged dues voluntarily. There are two while property taxes have gone up alternative to collecting mem79 percent, all other major taxes IFA COMPLETE HORSE PELLETS berships: Compulsory mem have shot up more than twice as An economical feed with vitamins, minerals, bership or Service to members. fast 195 percent. Farm Bureau members, speaking grains and grain products with alfalfa. through their state delegates have To explain further the idea of Recommended ration 1- -1 Vi lbs. per cwt. never determined that compulsory and service programs starting means was in keeping with their of horse. their successful continuation Mr. wishes. On the other hand work has Jarman related concepts that gone forward since the early $3.00 cwt. bulk $3.35 cwt. bagged must be aware of and take leaders development of Farm Bureau to care to observe. service programs, provide Service programs should come . IFA HORSE CONDITIONER legislative representation, comin need the from an expressed A hearty supplement to hay and pasture. munity service and other county and leaders being willing to marketing and bargaining efforts push the program when available. Rich in vitamins, minerals oats and other to encourage farmer and rancher Programs on a county level should Recommended ration -- 1 lb. per grains. participation. not compete with state level cwt. of horse. Outlining nine characteristics of programs. State Board approval a good member program he listed should always be obtained prior to the following as necessary: $4.05 cwt. bulk $4.40 cwt. bagged initiating such new programs. all prices f.o.b. Draper, Utah In connection with these 1. Must have an economic, programs, staff men can lend service, or quality advantage. assistance by helping to surface 2. Must be for members only. prospective programs, working out 3. Must pay its own way. procedural recommendations and 4. Must be available to all provide administrtive direction members. when approved by board. 5. Be state sponsored with county However, when a plan is approved direction. and the program gets under way, it 6. No program is must have the support of every sufficient to meet the economic Farm Bureau leader, both as to use needs of all members. and promotion. Weaknesses noted 7. Members must support and changes that are needed must financially in accordance to use. be met by immediate action. Open 8. Inventory money provided by criticism by Farm Bureau leaders state or counties must not be lost. could undermine the entire Utah and in Branches 9. No program should be unprogram. dertaken unless there is evidence Southern Idaho These ideas were presented by of a need. Mr. Jarman at the Fish Lake meeting on the basis of his many When programs succeed or fail the reason will likely be found with years of service to Farm Bureau and Utah Agriculture. one or more of the items reviewed. it. Jarman Talks About Programs 1. A Mow a choice oil UFA HOIF5SE FEEDS tor top conditioning -- one-servi- ce INTERMOUNTAIN FARMERS ASSOCIATION throughout . 7 |