Haven’t Filed an Income Tax Return? Watch Out!

If you have been procrastinating about filing your 2009 tax return or have other prior year returns that have not been filed, you should consider the consequences.

Taxpayers should file all tax returns that are due, regardless of whether or not full payment can be made with the return.  Depending on an individual’s circumstances, a taxpayer filing late may qualify for a payment plan.  All payment plans require continued compliance with all filing and payment responsibilities after the plan is approved.

Facts about Filing Tax Returns

• Failing to file a return or filing late can be costly.  If taxes are owed, a delay in filing may result in penalty and interest charges that could substantially increase your tax bill.  The late filing and payment penalties are a combined 5% per month (25% maximum) of the balance due.
  
  
• If a refund is due, there is no penalty for failing to file a tax return.  But by waiting too long to file, you can lose your refund.  In order to receive a refund, the return must be filed within three years of the due date.  If you file a return, and later realize you made an error on the return, the deadline for claiming any refund due is three years after the return was filed, or two years after the tax was paid, whichever expires later.
  
  
• Taxpayers who are entitled to the Earned Income Tax Credit must file a return to claim the credit, even if they are not otherwise required to file.  The return must be filed within three years of the due date in order to receive the credit.
  
  
• If you are self-employed, you must file returns reporting self-employment income within three years of the due date in order to receive Social Security credits toward your retirement.

Taxpayers who continue to not file a required return and fail to respond to IRS requests to do so may be subject to a variety of enforcement actions, all of which can be unpleasant.  Thus, if you have returns that need to be filed, please call this office so we can help you bring your tax returns up-to-date, and if necessary, advise you about a payment plan.

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Employer Tax-Free Medical Benefits Available to Children Under Age 27

As a result of changes made by the recently enacted Affordable Care Act, health coverage provided for an employee's children under 27 years of age is now generally tax-free to the employee, effective March 30, 2010.  Generally, under pre-Act law, to be a qualifying child of a taxpayer for this purpose the child must have been the taxpayer’s dependent under age 19 (or under age 24 in the case of a full-time student).

Child – Broad Definition for this Purpose Other than age, the “child” definition has no other restriction.  Thus, there is no income or marital restrictions.

These changes immediately allow employers with cafeteria plans – plans that allow employees to choose from a menu of tax-free benefit options and cash or taxable benefits – to permit employees to begin making pre-tax contributions to pay for this expanded benefit.

Employees who have children who will not have reached age 27 by the end of the year are eligible for the new tax benefit from March 30, 2010, forward, if the children are already covered under the employer’s plan or are added to the employer’s plan at any time. For this purpose, a child includes a son, daughter, stepchild, adopted child or eligible foster child.

Employees may immediately make pre-tax salary reduction contributions to provide coverage for children under age 27, even if the cafeteria plan has not yet been amended to cover these individuals. Plan sponsors then have until the end of 2010 to amend their cafeteria plan language to incorporate this change.

In addition to changing the tax rules as described above, the Affordable Care Act also requires plans that provide dependent coverage of children to continue to make the coverage available for an adult child until the child turns age 26. The extended coverage must be provided not later than plan years beginning on or after Sept. 23, 2010.

Contact your employer for further information regarding the employer’s plan related to this very beneficial change.

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Final Year for the American Opportunity Education Credit?

Without Congressional intervention, 2010 is the final year for the American Opportunity credit, which is a modified version of the Hope Education credit for tax years 2009 and 2010.  The American Opportunity credit is available to a broader range of taxpayers with expanded income limitations and a more liberal list of qualified expenses than was the Hope credit. Many of those eligible will qualify for the maximum annual tax credit of $2,500 per student.

The American Opportunity credit, in many cases, offers greater tax savings than other existing education tax breaks! Here are some key features of the credit:

• Tuition, related fees, books and other required course materials generally qualify. In the past, books usually were not eligible for education-related credits and deductions.
  
  
• The credit is equal to 100 percent of the first $2,000 spent and 25 percent of the next $2,000. That means the full $2,500 credit may be available to a taxpayer who pays $4,000 or more in qualified expenses for an eligible student.
  
  
• If you otherwise qualify, you can take this credit even if you have previously taken the Hope or Lifetime Learning credit in years prior to 2009.
  
  
• The full credit is available for taxpayers whose modified adjusted gross income (MAGI) is $80,000 or less (for married couples filing a joint return, the limit is $160,000 or less). The credit is phased out for taxpayers with incomes above these levels. These income limits are higher than under the former Hope and current lifetime learning credits.
  
  
• Forty percent of the American opportunity credit is refundable. This means that even people who owe no tax can get an annual payment of the credit of up to $1,000 for each eligible student. Other existing education-related credits and deductions do not provide a benefit to people who owe no tax. The refundable portion of the credit is not available to any student whose investment income is taxed at the parent’s rate, commonly referred to as the kiddie tax.

Though most taxpayers who pay for post-secondary education will qualify for the American Opportunity credit, some will not. The limitations include a married person filing a separate return, regardless of income, joint filers whose MAGI is $180,000 or more and, finally, single taxpayers, heads of household and some widows and widowers whose MAGI is $90,000 or more.

There are some post-secondary education expenses that do not qualify for the American Opportunity credit. They include expenses paid for a student who, as of the beginning of the tax year, has already completed the first four years of college. That’s because the credit is only allowed for the first four years of post-secondary education.  However, for those students who qualify, the Lifetime Learning credit may be claimed instead.

To maximize your credit for 2010, it may be appropriate for you to prepay certain education expenses that apply to the first quarter of 2011.  For additional information on this tax strategy or other issues relating to education tax benefits and credits, please give this office a call.

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Audit Techniques Guide Provided By the IRS

The IRS recently posted an Audit Techniques Guide (ATG) to provide its agents with guidance when auditing cash intensive businesses.  The following are some excerpts from the guide that points up the importance of maintaining detailed records for your business, especially one that is cash intensive. The audit guide essentially encourages the agent to turn over every stone in search of unreported income, and points up the importance of proper preparation for an audit should you be chosen for examination.

Misappropriating cash from a business - The ATG lists three main ways that cash can be misappropriated from a business:

• It can be skimmed from receipts, for example, pocketed before it is recorded. If this happens, it will not be discovered by auditing the books.
  
  
• It can be stolen after it has been recorded, for example, cash removed from the cash register or goods stolen from the shelf for future resale.
  
  
• A fraudulent disbursement can be created, for example, a payment to a vendor that is actually cashed by the owner’s son.

Indicators of unreported income - The most significant indicator that income has been underreported is a consistent pattern of losses or low profit percentages that seem insufficient to sustain the business or its owners. Other indicators of unreported income include:

• A lifestyle or cost of living that can’t be supported by the income reported.
  
  
• A business that continues to operate despite losses year after year, with no apparent solution to correct the situation.
  
  
• A Cash T analysis (measuring the taxpayers' personal expenditures against their reported income) shows a deficit of funds.
  
  
• Bank balances, debit card balances and liquid investments increase annually despite reporting of low net profits or losses.
  
  
• Accumulated assets increase even though the reported net profits are low or at a loss.
  
  
• Debt balances decrease, remain relatively low or don’t increase, but low profits or losses are reported.
  
  
• A significant difference between the taxpayer’s gross profit margin and that of their industry.
  
  
• Unusually low annual sales for the type of business.

Auditing cash businesses is both a science and an art - Tax law, accounting and the process of reporting income are sciences. These require specific knowledge and are concrete and tangible. These can all be verified. The art comes from the examiner’s own creativity in developing a method to determine that all income is properly included. For this, the examiner must use their individual style and flexibility to modify the examination process as needed for each particular case.

If an examiner wants to find income, they must actively look for income. Unlike examining expenses, which can either be verified or not, hidden income is harder to find and requires a proactive approach. Examination techniques must be tailored to provide for the best analysis of a specific taxpayer's possible income stream.

Whenever you are audited, it is wise to be represented by a professional who is experienced in taxes and dealing with the IRS.  Don’t attempt to handle an audit on your own; call this office for assistance. 

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Big Break for Self-Employed Health Insurance Deduction

Background - A self-employed individual (or a partner or a more-than-2%-shareholder of an S corporation) can deduct as an above-the-line expense 100% of the amount paid during the tax year for medical insurance on behalf of himself, his spouse and his dependents subject to the following requirements (Code Sec. 162(l)(1)(B)):

• The deduction cannot exceed the individual’s net earnings from self-employment derived from the trade or business for which the plan providing the coverage is established.
  
  
• For a more-than-2% S corporation shareholder, that shareholder's wages from the S corporation are treated as his earned income.
  
  
• No individual who is eligible to participate in any subsidized health plan maintained by any employer of the individual or of the individual's spouse is entitled to the deduction.  This test for eligibility is made for each calendar month and applied separately to long-term care insurance.

New Benefit - As part of the new health care reform law (Notice 2010-38), this deduction, as of March 30, 2010, also applies to a self-employed individual’s child under the age of 27 as of the end of the year.  The definition of “child” for this purpose includes the individual’s:

• child,
• stepchild,
• legally-adopted individual,
• an individual lawfully placed with the employee for legal adoption, and
• an eligible foster child. 

Previously, the child would have had to qualify as a dependent.  No other requirements apply so long as the individual meets the definition of a child and has not reached age 27 by the last day of the year.  Even a married child is included by this definition!  (But the married child’s spouse and/or children are not covered.) A child attains age 27 on the 27th anniversary of the date the child was born (for example, a child born on April 10, 1983 attained age 27 on April 10, 2010).

If the self-employed individual utilizes a group policy provided by an association, be aware that although group policies offered by insurers are also required to cover older children, they are only required for children under the age of 26.  Also, that law change only becomes effective for plan years beginning on or after September 23, 2010.

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Can a Spouse Qualify for HIRE Act Benefits?

Under the recently enacted HIRE Act, the following benefits are derived from hiring previously unemployed workers:

• Payroll Tax Holiday - The law exempts any private-sector employer that hires a worker who had been unemployed for at least 60 days (can have worked 40 hours within the 60 days) from having to pay the employer's 6.2% share of the Social Security payroll tax on that employee’s wages for the remainder of 2010. Thus, if the newly-hired and previously-unemployed worker earns $106,800 after March 18, 2010 and before the end of the year, the company could save a maximum of $6,621. This provides the employer with an immediate benefit by reducing the amount the employer must pay in employment taxes.
  
  
• Retention Credit - As an additional incentive, for any qualifying employee hired under this initiative that the employer keeps on payroll for a continuous 52 weeks, the employer is eligible for an additional non-refundable tax credit equal to the lesser of $1,000 or 6.2% of the wages.  Since the 52-week requirement cannot be met until the subsequent year, the credit will be taken on the employer’s 2011 tax return. In order to be eligible, the employee's pay in the second 26-week period must be at least 80% of the pay in the first 26-week period.  This credit is not available for domestic workers.

Will the payroll tax holiday and the employee retention credit apply if the new hire is the spouse of the business owner? The law specifically excludes the taxpayer's children or their descendants, siblings or step-siblings, parents or a parent's ancestor, step-parents, nephews, nieces, uncles, or aunts, and in-laws but not the business owner’s spouse.   Thus a spouse who has not worked more than 40 hours in the 60 days prior to the hire date may qualify provided the spouse does not fail the relationship test with another co-owner of the same business. For example a father-son owned business where the father owns more than 50% of the business would preclude the son’s spouse from qualifying since she would be related to the father, a more than 50% owner.

If you have questions related to hiring your spouse, or how the HIRE tax benefits might apply to your business, please give this office a call.

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Inherited Basis in 2010

Legislation enacted nearly 10 years ago repeals the estate tax for individuals dying in 2010, and then brings it back for those dying after 2010.  Although many had thought Congress would revoke the repeal for 2010, and keep the tax at 2009’s level, that has not happened yet.

Last December, the House by a vote of 225-200 approved H.R. 4154, the “Permanent Estate Tax Relief for Families, Farmers, and Small Businesses Act of 2009.” The bill made permanent the estate, gift, and generation skipping transfer (GST) tax laws in effect for 2009.  However, we are now well into 2010 and the Senate has not taken up that legislation.

For decedents dying in 2010 and later years, the House-passed legislation provides for an effective exemption amount for estate tax purposes of $3.5 million, an effective exemption amount for gift tax purposes of $1 million and a maximum estate and gift tax rate of 45%.  In addition, the house-passed bill would repeal the modified carryover basis rules that apply for purposes of determining basis in property acquired from a decedent who dies in 2010 (see overview of the computation below) and return to the step-up/step-down basis method that was in effect previously.

We have received questions related to determining the basis of property acquired from decedents dying in 2010.  Barring intervention by Congress, the step-up/step-down basis adjustment for inherited assets that was in effect for as long as most can remember does not apply to 2010.  Instead, a complicated (what else would you expect?) modified carryover basis system will apply to property acquired from decedents dying in 2010.  Thus, absent of any retroactive Congressional action, the basis of property inherited in 2010 is determined as follows:

Lesser of:
(1) the decedent’s adjusted basis, or
(2) the FMV at the date of death.

Plus:
(3) an allowable aggregate basis increase of $1,300,000 plus loss carryovers and built-in losses, and
(4) if applicable, a spousal property basis increase. 


(1) Substitute $60,000 for a non-resident alien.
(2) Tax loss carryovers that would have carried over to a subsequent tax year but for the death of the decedent.
(3) Losses from the sale of the decedent’s property if it had been sold at FMV immediately before the decedent's death, generally to the extent the loss would have been allowed as a trade or business loss.  
(4) Aggregate basis increase that is allocated among all the assets of the decedent. If the amount of the basis increase available is less than the unrealized appreciation in the assets whose bases are eligible to be increased, it will be up to the executor to determine which assets receive a basis increase. The basis of any individual asset cannot be adjusted above its fair market value.
(5) Additional basis increase that is allocated only to the surviving spouse’s “qualified spousal property”.  Note: If the spouse were the sole beneficiary, then the spouse would be entitled $4,300,000 of basis increase plus allowable carryovers and built-in losses.

Community Property – Generally applies where at least one-half of the whole community interest is included in the decedent's estate; both the decedent's and the surviving spouse's share of community property could be eligible for a basis increase.

Ownership Requirement - Where property was owned by the decedent and another person as joint tenants with right of survivorship or as tenants by the entirety, the following ownership rules will apply:

(A) if the only other person who is a joint tenant or tenant by the entirety is the surviving spouse, the decedent will be treated as the owner of only 50 percent of the property,

(B) in any case to which the rule at (A) doesn't apply and in which the decedent furnished consideration for the acquisition of the property, the decedent will be treated as the owner of the property to the extent of the portion of the property which is proportionate to that consideration, and

(C) in any case, to which the rule at (A) doesn't apply and in which the property has been acquired by gift, bequest, devise, or inheritance by the decedent and any other person as joint tenants with right of survivorship (and their interests are not otherwise specified or fixed by law), the decedent will be treated as the owner of the property to the extent of the value of a fractional part to be determined by dividing the value of the property by the number of joint tenants with right of survivorship.

Income in Respect of a Decedent Property that results in income in respect of a decedent is not covered by these rules.

This may all be overturned if Congress gets around to estate tax reform this year. But in the meantime, please give this office a call if you have questions.

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Hiring Summer Employees? QuickBooks Can Track Their Time

QuickBooks offers capable tools for tracking the items you sell, but it’s also quite a competent time-tracker. If you pay employees based on the hours they work, QuickBooks can ease your bookkeeping burden. Tracked time can flow to both invoices and payroll, helping you pay employees and collect on services provided to customers.

Before you start tracking time, you’ll need to be sure you’ve turned on the related tools. Click Edit | Preferences, and then Time & Expenses. Click on the tab titled Company Preferences. You’ll see the window shown in Figure 1.




Figure 1: Before you can start tracking and billing for time, you’ll need to fill out some of the fields in this Preferences window.

In this window, be sure you’ve checked Yes, and then select the first day of the work week from the drop-down list.

If you are going to want billable time to flow directly to invoices, check the first box under Invoicing Options. The other options in this window related to expense- and item-tracking; check with us to see if your business needs to use them.

Tip: If you want to use payroll to pay employees for time worked, be sure to check the box labeled “Use time data to create paychecks” when you’re building employee records as shown in Figure 2.




Figure 2: To facilitate the flow from time to paychecks, be sure this box is checked.

If you’re planning to use QuickBooks’ job-tracking, click on Sales & Customers in the left pane, then on the My Preferences tab. Here, you can choose how you want QuickBooks to handle available time and costs when you’re preparing an invoice.

Single Activities or Time Sheets?

QuickBooks offers two ways to enter time. You can record hours on individual tickets or fill out weekly timesheets. No matter which you choose, the information is always available in the other form. You can switch methods at any time, and your work will be preserved.

Let’s start with the individual time tickets. Open the Employee Center in the toolbar, or click on the Employees menu. Click Enter Time, then Time/Enter Single Activity. This window shown in Figure 3 opens:





Figure 3: It’s easy to record hours on this single-activity ticket by simply filling in the blanks.

QuickBooks pulls in data from other parts of the program, records you’ve already created. First, enter the activity’s date or select it from the calendar. Click the arrow next to Name and choose the appropriate employee from the list.

If the hours are going to be billed to a customer or job, click the next arrow and select the correct one (ignore this if you’re just recording company time, like regular compensation or sick time). Finally, pick the service that the employee performed, if applicable. Be sure to check the Billable box when it’s appropriate.

Tip: You can create a new record on the fly here if, for example, you haven’t set up the service you need to record. Click in the drop-down list.

Linking to Payroll

You can also use QuickBooks’ timer if you’re going to bill for a timed activity such as a phone call. And you can add notes that will be saved to the ticket.

QuickBooks provides other ways to describe hours spent so that they’re recorded properly. If you have payroll turned on and have associated a payroll item with the selected service item, the Payroll Item field (which indicates how much the employee should be paid) will automatically be filled in. You can easily change this field if necessary.

If you haven’t created a payroll item, select . A wizard will walk you through the process. This relationship can be a bit confusing so talk to us if you have any questions. When you’re done, click Save & Done or Save & New.

Week at a Time

Weekly timesheets can save you a lot of time. To get there, open the Employee Center in the toolbar, or click on the Employees menu. Click Use Weekly Timesheet. You’ll see a window similar to the one shown in Figure 4:




Figure 4: Rather than entering each activity individually, you can document an entire week at a time using the Weekly Timesheet.

You can speed through weekly timesheets, using the drop-down lists to select the appropriate data and entering the number of hours worked. Click Copy Last Sheet if you want to duplicate the configuration from the last pay period.

QuickBooks Time Tracker offers another way to save time and avoid errors. Employees can send their timesheets from any computer that has an Internet connection. Your payroll person can then download and incorporate them into the company’s payroll. Prices start at $10/month for one user.

So whether you’re bringing employees in for seasonal help or your regular payroll incorporates time toiled as well as items sold, QuickBooks contains the tools you’ll need to both invoice customers accurately and dispatch proper paychecks.

If you need help with this feature, or have any questions on QuickBooks’s reporting, don’t hesitate to give this office a call.

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Tax Credits for Small Employers Offering Health Coverage

The Patient Protection and Affordable Care Act provides a tax credit for an eligible small employer (ESE) for nonelective contributions to purchase health insurance for its employees. The term "nonelective contribution" means an employer contribution other than an employer contribution pursuant to a salary reduction arrangement.

o 2010 through 2013 – For tax years 2010 through 2013, qualified small employers, generally those with no more than 25 full-time employees with an average annual full-time equivalent wage of no more than $50,000 will be eligible for a tax credit of up to 35% of the cost of nonelective contributions to purchase health insurance for its employees.  (Note, however, that the phase-out of the credit operates in such a way that an employer with exactly 25 full-time equivalent employees or with average annual wages exactly equal to $50,000 is not eligible for the credit The maximum credit is available to employers with no more than 10 full-time equivalent employees with annual full-time equivalent wages from the employer of less than $25,000.

o 2014 and Later - In 2014 and later, eligible small employers who purchase coverage through the Insurance Exchange would be eligible for a tax credit for two years of up to 50% of their contribution.

An eligible small employer generally is an employer with no more than 25 full-time equivalent employees employed during its tax year, and whose employees have annual full-time equivalent wages that average no more than $50,000.

The credit percentage that can be claimed varies with the number of employees and average wages. The full amount of the credit is available only to an employer with 10 or fewer full-time equivalent employees and whose employees have average annual full-time equivalent wages (AAEW) from the employer of less than $25,000.

Calculating the credit amount - The credit is equal to the lesser of the following two amounts multiplied by an applicable tax credit percentage (shown in the table below) and subject to the phase-outs discussed later:

(1) The amount of contributions the eligible small employer made on behalf of the employees during the tax year for the qualifying health coverage.

(2) The amount of contributions that the employer would have made during the tax year if each employee had enrolled in coverage with a small business benchmark premium. Contributions under this method are determined by multiplying the benchmark premium by the number of employees enrolled in coverage and then multiplied by the uniform percentage that applies for calculating the level of coverage selected by the employer. (See table below)


Computing the Credit Phase-Out – The full credit is only available to eligible small employers with 10 or less full-time equivalent employees with an average annual full-time equivalent wage (AAEW) of $25,000 or less.  If either or both of these thresholds are exceeded, then the credit is reduced. 

There is no credit reduction if there are 10 or less full-time equivalent employees FTEs with an AAEW of $25,000 or less.

There is no credit if the full-time equivalent employees exceed 25 or the AAEW exceeds $50,000.

To figure the reduction of credit when the limits are exceeded, the number of the employer’s full-time equivalent employees and average annual full-time equivalent wages (AAEW) for the year must be determined.

Figuring the number of full-time equivalent employees - An employer's full-time equivalent employees (FTEs) is determined by dividing the total hours the employer pays wages during the year (but not more than 2,080 hours per employee) by 2,080. The result, if not a whole number, is then rounded down to the next lowest whole number if any.



Calculating average annual wages (AAEW) - Average annual equivalent wages is determined by dividing the employer’s total FICA wages (without regard to the wage base limitation) for the tax year by the number of the employer's full-time equivalent employees for the year (rounded down to the nearest $1,000 if need be).



Credit reduction - If the number of full-time equivalent employees exceeds 10 or if AAEW exceed $25,000, the amount of the credit is reduced (but not below zero).  Both reductions can apply at the same time!



Example – Joe owns a small California wood working business and has 12 employees, not counting himself or family members.  The total FICA wages (without regard for wage base limitations) for the year were $297,500 and total hours worked by his employees during the year were 24,400.  None of his employees worked more than 2,080 hours during the year.   Joe made nonelective contributions to purchase health insurance for his employees in the amount of $49,800 for the year.  Joe’s credit is determined as follows:

• Small Business Benchmark Premium (from Table Below) = 12 x 4,628 = $55,536
• Smaller of actual premium paid or Benchmark premium = $49,800
• Tentative credit = $49,800 x 0.35 = $17,430
• Full-time equivalent employees (FTEs) = 24,400/2080= 11.7 rounded down = 11
• Average annual full-time equivalent wages (AAEW) = $297,500/11 = $27,045 rounded down = $27,000
• FTE Reduction = ((11-10)/15) x $17,430 = $1,162
• AAEW Reduction = ((27,000-25,000)/25,000) x $17,430 = $1,394
• Joe’s health insurance tax credit = $17,430 - $1,162- $1,394 = $14,874



Other Issues:

o The credit reduces the employer's deduction for employee health insurance. 

o Aggregation rules apply in determining the employer. 

o Self-employed individuals, including partners and sole proprietors, 2% shareholders of an S Corporation, and 5% owners of the employer are not treated as employees for purposes of this credit.

o The credit is not available for a domestic employee of a sole proprietor of a business, and there's a special rule to prevent sole proprietorships from receiving the credit for the owner and their family members. 

o The credit is a general business credit and can be carried back one year and forward for 20 years. However, because an unused credit amount cannot be carried back to a year before the effective date of the credit, any unused credit amounts for taxable years beginning in 2010 can only be carried forward. 

o The credit is available for tax liability under the alternative minimum tax. 

o The credit is initially available for any tax year beginning in 2010, 2011, 2012 or 2013. Qualifying health insurance for claiming the credit for this first phase of the credit is generally health insurance coverage purchased from an insurance company licensed under State law.

o For tax years beginning in years after 2013, the credit is only available to an eligible small employer that purchases health insurance coverage for its employees through a State exchange and is only available for a maximum coverage period of two consecutive tax years beginning with the first year in which the employer or any predecessor first offers one or more qualified plans to its employees through an exchange.

Please call this office if you have questions related to Tax Credits for Small Employers Offering Health Coverage.  

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Are Capital Gains Being Raised in 2011?

Congress lowered the capital gains rates for 2003 through 2010 and they have not shown any inclination to extend the lower rates past 2010.  Therefore, unless Congress acts, the rates automatically return to the pre-2003 levels of 10% (up from the current 0%) for those in the 15% or less bracket and 20% (up from 15%) for everyone else.  If you have capital gains, you may wish to consider whether or not to take them in 2010 while the rates are still low.

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