Do the numbers 18 or 9 mean anything special to you?  If you are challenged by stairs, 9 is half way and 18 is the top…Thought everyone should know this!  Moving right along, we began with TONY DERYAN leading the Pledge.  Two of our PP’s, DOWNIE and DAY, combined on the song, The Battle Hymn of the Republic.  Next up was another PP, BOB WESSLING, who provided an Invocation given during the years when Bishop Mel Wheatley was presiding at Westwood United Methodist.  Many of us who belonged during that period can almost repeat it from memory, and the ending perhaps summarizes it best – “Become now the daily companion of our lives, for all this interval between the miracle of our origin and the mystery of our destiny, that we may claim your light to guide us, your strength to uphold us, and your love to unite us to each other here and now, but much more even than that, your love to unite us to all whom we love, wherever they may be, this day and through eternity.” Wonderful words, BOB.


PDG ANDY ANDERSON being unable to come up with any Visiting Rotarians,  PP HOMER NEWMAN was quick to introduce his wife of over three years, SALLY Whateverherlastnamewas.  Also present with a guest was ED JACKSON, who brought along Barron Avery.  Barron is still in school, but still finds time to coordinate the activities of those students who belong to the Sisco Society.  Barron’s particular emphasis is on the Media and its many areas of specialization.  And while this coordination is part of the school curriculum, the contracts that come from it can earn some cash! We wish ED and Barron well in this endeavor. SUSAN ALLEN again brought Yoshio Umazawa as her guest – she has completed her time as an Ambassadorial Scholar, and is still working toward her PhD at UCLA. 


The Sweetheart Brunch at Shanghai Reds was a big success last Saturday.   There were sixty members and guests there, and we all had a great time.  These events don’t just happen – those who helped put it together include KEVIN KOMATSU and PP RALPH WOODWORTH , MARIAN TSENG for her Invitation card, PAT ANDERSON, ELOISE SISKEL and SHIRLEY MORE for the Center Pieces, PP JIM DOWNIE – as usual – for the music, and LEO TSENG who hosted the Quiz Show.  DON NELSON kept track of the reservations, and SHIRLEY MORE along with SHANE WAARBROEK were the paparazzi.  We can’t fail to mention that the two ladies who met their future spouses at the earliest ages were LENORE MULRYAN, who knew JOE when she was six, and MARGE DOWNIE, who knew JIM by the time she was eight!


LEE DUNAYER came forward to plug the Hobby Day, which will be March 4th.  The display area will be in our anteroom (except for the cars, which have to stay in the Parking Lot). and several of the hobbyists will be talking about what they do and how they do it.  LEE gave us fair warning – if he has to call you to find out what you might like to show, he might then start to ask if your stock portfolio is performing as you expect!  The only sure way to avoid this is to call him first, obviously.


Pres. PETER next provided a visual history of Westwood and UCLA, in the form of a number of black and white photos, accompanied by some banjo music and singing.  There was a lot of vacant land beyond Beverly Hills prior to 1927, when construction started at UCLA.  The first four buildings were Royce Hall, the Powell Library, and the Physics and Chemistry buildings.   The famous Gully was there, of course, and the whole area almost wasn’t recognizable.  It was a great overview, supplemented by some recent aerials taken by PETER – he wanted it understood that the earlier B&Ws were NOT shot by him!  As a part of these scenics, SANDY SANDERSON has put together a great History of the area.  This is available for ten dollars, and there are only ten copies – the income going to our Foundation, so get your copy while they last.  SEAN McMILLAN spoke briefly about the 75th Celebration, and urged us to sign us soon, PLUS inviting others whom we may know.  Extra Invitations are available – they’re even stamped!


Pres. PETER reminded us that only two things in life are certain – and our three tax   experts will tell us why Taxes are the least of the two. PP CHRIS GAYNOR came forward with a quick overview of  what they would be presenting, noting that these subjects were near and dear to our three CPAs – and hoping that we would soon agree that their topics would be near and dear to us, also. CHRIS first pointed out that almost everyone he counsels doesn’t seem to be fully prepared financially for retirement, and he tries to emphasize this with every client. There will be unexpected costs – perhaps college costs are still ahead – and only advance planning can assure you of a carefree retirement.  He noted that more clients than ever are falling into the Alternative Minimum Tax bracket, and so he asked GORDON FELL to explain that unfortunate phenomenon.


GORDON started by asking what Tax Form we are currently submitting – and the answer, of course, was 1040.  However, this can easily drop you into 6251, the Alternative Minimum Tax, and that can have serious consequences.  The original purpose was to assure that everyone paid SOME tax, but the application has had some surprising and unfortunate results.  When your 1040 is completed, the computer then decides if you should be under 6251 – and if so, everything is refigured.  Many supposed deductions do not qualify, and the result almost always is an increase in what tax you pay.  For those in the higher income brackets, the AMT (6251, that is) can provide some nasty surprises.  Remember that the maximum tax was 70% not too long ago, and it has consistently been reduced, recently to 38.5% and today, 35%.  However, if your previous deductions don’t count, the new tax owed can be a shocker.  The only good news in all this is that an overpayment carries forward. And note that you cannot avoid being considered as a candidate for 6251 – the computer makes that decision.  For those who do their taxes by hand, they can theoretically avoid being placed into 6251 – and that’s a sure way to get into serious tax trouble. 


PP STEVE DAY spoke about Capital Gains.  There is some excellent software that can alert you to your status, and remember you must deal with Capital Gains during the year they occur, NOT later.  Essentially, Capital Gains are assets that have been held over time – one year minimum – and the current tax is 15%.  However, just to get your attention, artwork, for instance, is taxed at 28% - and rental property at 25%. Dividend-producing stock is taxed at 15%, which is an advantage.

Capital losses do not qualify, while capital gains do.  Note that you can get the $500K tax credit on your primary residence and after that, get it again on rental property you occupy – do you get the impression that you may need help in untangling some of these rules?


CHRIS noted that there is a huge disparity between the federal and state tax rate – 8.6% is the California rate.  PP STEVE SCHERER asked what are the chances of a tax audit, and what items will flag an audit.  While the present rate of audits is only 0.5 %, this will increase since they are hiring more IRS agents all the time.  Your Schedule C (Sole Propietaryship) is the area that will get first attention, so you should be sure it makes some sense, rather than relying on what was OK before.

Another target is the S Corporation.  Non filers, of course, are a real tempting target. 


At this point, you will not be surprised that PP ERIC LOBERG rose to his feet with the suggestion that we should all hold hands and sing Silent Night.  Failing this, we adjourned.


Guys, you did a good job of scaring the hell out of some of us.  I suppose this could be called business promotion, but in any case, what we did learn was certainly worthwhile.

                                                                                             YOE, Ernie Wolfe