Friday, March 25, 2011

Hello...Daytona...You Paying Attention?

This post has nothing to do with taxes or accounting. But given my past, I had to express my opinion on the state of online viewing options in sports.

NASCAR really needs to pay attention to what the NCAA & their partners are doing with live video streaming, stats, etc. NCAA is again offering free streaming for any tournament game. There are stats galore. I love it and apparently so do lots of other fans. But the curious thing to me is that TV ratings for March Madness are at 20-year highs.

Twenty-year highs! Even with these other viewing options, TV ratings are through the roof!

Meanwhile, NASCAR TV ratings continue to be flat or down over the last 4-5 years. They offer no streaming and there are no apparent plans to offer any online options in the near or distant future. The NASCAR partners cannot seem to come to grips with how to share the playing field in the best interest of the fans and sport. They are still using excuses like they do not want streaming to hurt their local affiliates. Accordingly, they have been left behind and remain lost with respect to online options and I think they are losing fans at least partially because of it. 

Did I mention March Madness ratings are at twenty-year highs?

Let's face it, if I have an option to watch NCAA/NASCAR via cable/DirecTV, I will. Streaming is still inferior to those options. I bet most fans feel this way. As the Applebee’s online commercial that runs during the NCAA games jokes about, I am watching on a small screen with bad speakers.

I certainly prefer my big flat screen. But, as I sit here in the office in the middle of tax season, I have two options. 1) Stream my sports or 2) not watch sports. I want to watch sports, so I stream. Pretty simple.

I am a viewer the local affiliate would not have had anyway, so how does the streaming negatively impact them?

From a loyalty standpoint, because I can stream and watch the NCAA tournament, I stay in touch with the sport. I stay connected with the sport. I also stay connected with my friends as we chat about games and brackets. I cannot wait for the next game to begin. I am planning my workload over the next couple of days so I can watch my Bulldogs in the Elite Eight for the second straight year...but via TV, not streaming.

On the NASCAR side of my life, I have lost that connection. It is tax season. I dvr'd Daytona and watched the last 10-15 laps. I was very happy for Trevor Bayne. But I have not watched a lap since. Sorry MRN, I am a visual guy. I have to see it.

Come on, I used to make my living in NASCAR. I used to live, breathe, eat and sleep NASCAR. I have not watched a lap in over a month.NASCAR, if you can lose me, how do you expect to keep all those casual fans you attracted interested?
I know NASCAR is headed out west this weekend. However, that is because I have friends/clients involved in the sport. It is not because I am really paying attention to the sport. I will probably check on Jayski to see who won. I might even check to see how qualifying went. But, I will not watch a lap and I will only do those things if it does not interfere with watching the tournament.

Did I mention March Madness ratings are at twenty-year highs?

Sunday, March 6, 2011

But I Paid the Tax!

Q: I just had my taxes done and I owe a lot of money. My CPA says it is because an early IRA distribution I took. I don’t understand because I paid the tax when I got the money. What is he talking about?

A: Well, this is a common misconception. I think the confusion is that you had tax withheld. But you did not actually pay the total tax due.

Just like the taxes withheld from your normal paycheck, you made payments towards your year-end tax bill. But you did not actually pay the total tax due. The total tax on April 15th may be more or less than what was withheld from your check.

If you paid in less via these withholdings than the total tax, you are going to owe at April 15th. If you paid in more than the total tax, you get a refund.

Obviously this is too late for you and your transaction, but taking funds out of your 401(k)/IRA is one of the last places you should go to get cash. That is especially true if you are younger than 59½ because then you will likely have the 10% federal penalty. You also have the ordinary federal income tax and your state income tax.

In North Carolina, where I live, those taxes and penalty can easily eat up more than 40% of the distribution. If you only had 15-20% withheld, you still have 20-25% due.

So next time, talk to your CPA before you take a distribution like this. Maybe your CPA can help you find better financing options. If not, you will at least know how much tax this is going to cost you.