The President's Message

February 2009

Paul Westefer

Update of topic discussed in January CIPCUG meeting. On Jan. 29, the Associated Press reported that the House of Representatives defeated a bill to extend the Feb. 17 deadline for the transition from analog to digital television broadcasting. This would leave 6 million U.S. households unprepared for the switchover. Consumers who subscribe to cable or satellite or own and have installed a digital tuner would not be affected. So what is the problem? The problem is that many poor, rural and low-income Americans cannot afford the change.

The digital-to-analog converters cost $40 to $80. The Congressional solution was to allow consumers to request up to two $40 coupons per household. I have not read or heard of what oversight, if any, was placed on the distribution of coupons. The Department of Commerce established a $1.34 billion funding limit for the coupon distribution. So, then, there was no limit on the number of coupons to be distributed, but there was a limit on the number of dollars to pay for those coupons. In January 2009 that limit was reached. Consumers were left with coupons which could be used only as funds became available when earlier coupons expired without being used.

There were also 3.2 million requests for coupons on a waiting list. According to the Associated Press, those coupons will not be distributed before the Feb. 17 deadline for their use. That is the situation as of Jan. 30. We will keep you updated. [Ib /

Feb. 3, the House voted to move the deadline to June 12.-- Editor] Attention CIPCUG members 70 1/2 or who will become 70 1/2 in 2009. The Minimum Required Distribution (MRD) required by federal law has been suspended for 2009 only. If you are in one of the age groups listed above and you have retirement funds subject to MRD, we urge you to consult your tax preparer, brokerage firm, attorney, or the Internal revenue Service. Remember the IRS is not bound by information it provides you even if it is incorrect.

The MRD provisions may require you to withdraw money, even if you do not want to, in order that the IRS may tax it. Before retiring I was a trustee/director on four pension plans. No labor, management, or plan adviser favored the MRD. If you feel the MRD suspension should be made permanent contact your representatives in Congress and the Administration.