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Short Interests: Extending a hand to military personnel

An independent investment planning firm in Boca Raton, Fla., earlier this month sent what was supposed to be a not-too-significant press release to the local newspapers.

The release announced that the three partners of Lawless Edwards & Warren will provide free counseling on financial matters to reservists and other military personnel who have been deployed to the Middle East.

Gregory W. Edwards, a partner at the firm, which manages more than $100 million, admits that he was surprised – and concerned – when USA Today ran a short front-page article on the offer.

“We only have a staff of nine; we simply couldn’t handle 50,000 calls!” says Mr. Edwards, who adds that the motivation behind the free service is personal. “My brother’s in the reserves. These guys are doing a great job for us, and we want to help.”

Mr. Edwards says that the firm so far has had just a handful of calls from military personnel requesting assistance. He cites as an example a recently married military officer who called for advice on drawing up a will.

Taxing issue

People who live in states with no income tax could deduct sales taxes on their federal income tax returns if legislation introduced by Rep. Gene Green, D-Texas, becomes law.

The legislation would eliminate discrimination against people who live in states with no income tax, Mr. Green said in a release. Taxpayers in other states can deduct state income taxes when computing their federal tax.

In states that have no state income tax, such as Texas, residents aren’t eligible for such deductions.

“Even though they pay state sales taxes that are equitable to income taxes in other states, these individuals are penalized because they don’t pay a state income tax,” Mr. Green said in the release.

If the legislation were enacted, the Internal Revenue Service would have to publish tax tables, indexed for inflation, calculating deductions for each state, based on family income and the number of dependents.

That method would prevent taxpayers from having to keep shoe boxes of sales receipts, the congressman said.

Razing raises

Employees at Boston-based mutual fund giant Fidelity Investments got word in early February that no money had been set aside for annual raises in the company’s 2003 budget.

Company spokeswoman Anne Crowley says the situation could change – if, of course, the stock market and economy do a 180-degree turn between now and July.

Two years ago, Fidelity did away with pay raises for all employees earning more than $75,000 a year. Fidelity managed to resume those raises in 2002 despite a 15.2% drop in assets under management.

The nation’s No. 1 fund company has about 29,142 employees. That is down 7% from the amount a year ago due to layoffs and attrition.

How did those employees take the news about their raises?

“I think employees understand overall,” Ms. Crowley says. “The economy has been in a slump for several years. They are fortunate to work for a company that compensates its employees very well and provides significant benefits.”