Coming up on DTNS, the colonial pipeline attack is resolved, plus what a US executive order on security means, and a way to let paralyzed people type with their minds. This is the Daily Tech News for Thursday, May 13th, 2021, in Los Angeles, I'm Tom Merritt. And from Studio Redwood, I'm Sarah Lane. From Austin, Texas, I'm Justin Robert Young. And I'm the show's producer, Roger Chang. We were just talking about Disney's new streaming numbers, how they compare to Netflix, the new CDC mask guidelines, and why Justin is willing to go inside for a paid event. It's amazing, folks. Get that wider conversation on Good Day Internet. Become a member of patreon.com slash DTNS. Let's start with a few tech things you should know. Microsoft is shutting down its Azure blockchain service on September 10th, with only pre-existing deployments supported until that date. Microsoft is suggesting that users start migrating to an alternative, recommending Consensus Quorum Blockchain Service, Azure Blockchain as a service, or BAAS, launched back in 2015, on the Ethereum platform with Consensus, with a certified blockchain marketplace, as a short-term goal, but there's no official word on the reason for the shutdown. Not a good sign, though. Italian antitrust regulators have fined Google $123 million, saying it abused its dominant market position with Android Auto, by restricting the electric car charging app JuicePass from being on the platform. As part of the ruling, Google must allow JuicePass on Android Auto, and provide the same interoperability to other third-party developers. A new national blueprint in South Korea outlines plans to invest $450 billion to build the world's biggest chipmaking base by 2030, involving 153 companies. Samsung Electronic will boost spending 30% to $151 billion by 2030, with SK, a hynix, committing at $97 billion to expanding facilities, in addition to $106 billion plans for four new chipfabs. Roku announced it'll launch its original programming on the Roku channel in the US, UK, and Canada on May 20th. This is the original programming, not the stuff that's provided by other great people like Rotten Tomatoes. The initial slate will be 30 shows Roku previously acquired from Quibi, with plans to roll out more acquired content throughout 2021. Intel and Q-Tech demonstrated a first in quantum computing, high fidelity, two-cubit control using its horse-ridge cryogenic control processor, opening the door to processors that integrate the electronics and the quantum chip on the same die. Previous quantum systems were often bottlenecked by using room-temperature electronics to manage a super-cooled quantum processor. Oh, folks, the fuel is flowing again. Can you feel it? Can you feel it under your feet east coast? Colonial Pipeline, which had shut down its 5,500-mile fuel pipeline in the Eastern US, not 500,000 miles, after a ransomware attack, reopened the pipeline Wednesday afternoon. Colonial says it will take, quote, several days for product delivery to return to normal. So by this weekend, service should be back to normal. It's gonna take a while for everything to catch up in the system. Bloomberg sources say that Colonial paid a $5 million ransom to unlock its systems, which is surprising to some because CNN and Reuters reported Colonial was not going to pay the ransom. In fact, CNN even said Colonial had managed to retrieve the most important data without having to worry about ransomware. If you've got proper backups and can restore, often that is the case. It does not appear still that control systems were ever directly affected by this. Security reporter Kim Zetter, who does a great job on this stuff, suggested from a source that the shutdown happened not only to prevent the ransomware from spreading from Colonial's business systems into the control systems, but also to keep the systems of other companies in the distribution network, like tank farms, safe from the ransomware. So it wasn't just Colonial's own systems. The Associated Press cited the author of an independent audit of Colonial Pipeline from 2018, just a few years ago, as finding atrocious information management practices and a quote, a patchwork of poorly connected and secured systems. So that author saying, not a big surprise to me, that Colonial got hit by this, but we still don't know if they really did pay the $5 million, kind of looks like maybe they did. Yeah, that's a very interesting question because when we get into the idea of ransomware, which I think, aside from great shows like this, is undercovered in terms of what a lot of the effect that it can have, we should probably have a better idea, not only in terms of business standards, but also our public response to how these kinds of threats should be dealt with. I'm glad they got it reopened, obviously. We're gonna see a spike in Google searches for how do I return a bag of gas for a full refund, but we will... Is it legal to sell a bag of gas? Yeah, current going price for a grocery bag of gas will certainly be entered. I don't know, I wish that we could say this is going to be the most audacious ransomware attack that we'll see this year, but I don't think I could do it with a straight face. It sounds like based on this independent audit, that Colonial Pipeline had a lot to learn about being a little bit more secure. The word's atrocious when talking about a patchwork of connected and supposed to be secure system that were in fact not. So that's one issue. I do think the other issue is, and I understand why Colonial Pipeline, if a ransom was paid five million at that, why the company didn't want to say so, right? Because it's like you're sort of admitting that you needed to do that and you weren't already up to speed and kind of encourages ransomware attacks. But it would seem that this shouldn't be a question that sort of like, did they or didn't they? I mean, the folks who wanted that money would probably have some way to prove that they got it, right? Yeah, I mean, as far as keeping it out of imitators, on the one hand, not having it public does maybe keep a few people from believing that it's widespread and trying it, but if Darkside, the attackers that are thought to have done this did get five million out of Colonial, Darkside knows, and so do a lot of other people on the dark web who follow what Darkside does. I'll be honest, Bloomberg source says that five million isn't really a lot. For usually something this size would be 25 to 35 million. So if they did pay five million, I think they got off cheap and it may be that Darkside didn't mean to go after Colonial. I'm still holding that out as a possibility that this was accidental, that it was targeted at something else and maybe because Colonial's network is so atrocious, it spread worse than was intended, or that they overshot and realized, oh, wait, we don't want that kind of attention because ransomware folks don't want a lot of attention. They want to be quietly paid because they don't want law enforcement targeting them. They don't want people to know about them. They just wanna go about their business and make money. As Darkside has said in its public statement on Monday, that's why they do this. They're not social activists. They're trying to just rake in dollars. Straight crooks. Yeah, we're gonna talk about a story a little bit later that gets into some of these issues, but for right now, I would just say, if you are a major company, I feel like we should record an infomercial. If you or someone you love has an atrocious information management practice or a patchwork of poorly connected and secured systems, now is the time to invest in infosack. Yeah, as we have said over and over, what Justin just said is entirely true. You will pay later at some point. If you don't pay now, pay now to good actors that will make these glaring holes in your system harder to exploit. Tesla's Elon Musk issued a statement announcing the company will stop taking Bitcoin 49 days after they announced that they would accept it for the purchase of cars. Tesla holds about $1.5 billion worth of Bitcoin and Musk says the company will not sell anymore of it. In the statement, Musk said the company is concerned about the energy use of Bitcoin mining, especially where power comes from coal, quote Musk. We intend to use it for transactions as soon as mining transitions to a more sustainable energy. We are also looking at other cryptocurrencies that use less than 1% of Bitcoin's energy to transaction, quote. This is weird to me. Well, okay, it's Tesla and it's Elon Musk. But 49 days ago, and we talked about this, oh, Tesla's gonna start accepting Bitcoin as payment for vehicles. Okay, sure, fine. That didn't seem too weird at the time, it's just an option, it's not required. But 49 days ago, the company would be aware that there is at least a conversation, not everybody agrees on how bad it is, but there's been a conversation going on for some time about energy consumption from mining Bitcoin. So for the company to say, you know, whoa, we just read this article and boy, it seems like maybe this is a little bit too, you know, tough on the energy sector here. We're gonna pause this whole thing until we can figure out a better idea. But it is just not wringing true to me at all. It's not like y'all, I was just on medium and you have no idea how much. Yeah, it's just, that's insane. Justin, what changed in the past 49 days? So let's understand that Elon Musk indeed is capricious and very much a subscriber to the move fast, whether or not it's rather, you'd rather take this moment of embarrassment or backtracking than double down on a mistake. This could easily have just been grime showing him a TikTok explainer that made him type up this statement and post it on Twitter. However, if I were to guess, I would say that part of it is Tesla's mission is clean energy. If this is something that they materially and they could only mean Elon Musk or other people in the company believe that the idea of Bitcoin is environmentally unsafe begins to erode that part of the brand, then now it is brand detrimental and you'd rather cut it off here than go on later and say, well, okay, well, if Tesla really does care about clean energy, then why are they taking Bitcoin? They'd rather end it there. So I guess what you're saying is 49 days ago, they didn't think there'd be as much backlash as they saw. That, yes. It's not that they didn't know there was an issue. They just didn't think it would be as big of a deal. If it becomes a problem to the brand, then yes, it now becomes something that they need to react to in a way that they wouldn't before. Well, that might be the only thing that I'd like to. Well, speaking of currencies, remember Facebook's Libra? It was gonna be backed by a basket of stable currencies and operate under a Swiss payment license. Yeah. Remember how nearly every government in the world lashed out against it as they felt it threatened to undermine government plans for digital currencies. Indeed. Well, yep, yep, so that all happened. And now it's not Libra, it's the DM association and it's not backed by a basket of currencies, just the US dollar. And now DM has withdrawn its application for a Swiss payment license, moved headquarters from Switzerland to Washington DC and partnered with California's Silvergate Bank. Yes, a bank. Silvergate will issue DM's coins and also run its blockchain-based payment system. So to sum this all up, Facebook's worldwide Libra system for the unbanked is now DM, which is a US dollar stablecoin run by a bank. I admire their commitment to the bit, I guess. You know, like, hey, but we got this thing, it might still be good for something. What if we add Silvergate? You don't wanna work with us? You don't either? It is a pretty funny how it started, how it's going, right? Like it went from this very ambitious idea that was not only backlash from countries, but also from people as the idea of Facebook being, you know, a part of some gigantic currency was an unpopular one, as many Facebook moves at least initially are. But I think, Tom, you said something in our pre-show that I found fascinating that, you know, this is not a government-backed currency, but it is a stable one backed by a bank and tagged to the US dollar. And you may mention that you're bullish on the idea of country-backed coins becoming more of a thing. Yeah, when I say I'm bullish, I mean every country is going to try to have their own backed currency, which to me explains why they were so angry with the idea of Libra. Every country wants to have a stablecoin that they issue. And don't get me wrong, they don't want to do a speculative coin like Bitcoin or even Ethereum. They want to do just a digital currency that they can issue and it will be available instantly and it will smooth the wheels of commerce within their nature. The Bahamas already has it. China is the farthest along, but the US, Europe and pretty much every country you can think of is in some way planning to have their own version of a digital version of their own currency. So that's to me, why Libra got beat down. And this is where it ended up. We'll see if it's good for anything. Folks, you can join in the conversation in our Discord. You got some ideas about what Diem might be good for. Let us know there in the Discord. And you can join that by linking a Patreon account at patreon.com slash DTMS. A new US executive order authorizes the US Commerce Department to create cyber security standards for companies that sell software services to the federal government. So this is pretty standard stuff. You're gonna sell something to us has to meet these criteria. It also implements standards for quicker incident reporting when something happens again on a federal network or in software that is used by a federal agency and standards of response. So how those responses are made and it tries to remove contractual barriers that prevent communication between vendors and investigating agencies while still protecting user privacy. There were a lot of blanket clauses that said the vendor won't tell you any of this stuff that we're getting in the way of these investigations. So it's trying to thread that needle. The order creates a cyber safety review board. This will be part of the Department of Homeland Security. It'll be made up of representatives of all the three letter agencies, DOD, DOJ, NSA, FBI, also a four letter agency, CISA, and private security companies. So they're gonna bring some folks from the industry on this. That board will review incidents that meet a certain level starting with the solar winds attack from December. This is being positioned in a lot of stories as being a response to colonial. The announcement may be a response to colonial. The executive order is a response to solar winds. The order also implements several security standards for vendors and users of software and services used by the federal government. Some of the rules require things like encryption and multifactor authentication. They were often required anyway, but this says everybody's gotta do this, no excuses. There are also provisions in here to direct the National Institute of Standards and Technology or NIST to draw up minimum standards for vendors. The rules only apply to government, but the hope is that requiring these standards in software will cause the companies that sell to the government to implement them for all their customers and therefore having a knock on effect of improving security in general. Yeah, these kind of requirements are not new when it comes to government contracts. Government contracts come with all sorts of different little, some security related, physical security or bookkeeping accounting related requirements just to make dealing with our federal government or local or state government easier and more uniform. That being said, this is not only needed, I think it should even go further. I believe that we should have some kind of public watchdog and let's start with just government contractors and specifically some of these companies that basically create the backbone of our industry and utility and say, hey, look, if you get hit by a cyber attack, number one, here's all the things you need to do beforehand, but if you do, there's going to be a mandatory reporting period for which the public needs to know because these are public funds that are going into it. I think that there is no security through obscurity and that even counts on whether or not you are paying a ransom. We need to know everything, every step of the way, the information benefits everybody and if it starts with government contracts, then that's better, I would love to see this just become privacy standard or just reporting standard for everybody because these ransomware attacks are not going away. We have a brand name in ransomware as a service with dark side, this is a brand now. Like that's how bad it is. Yeah, part of my brain still pretends that we're in the Nixon administration and executive orders are only used for certain things and reconciliation is in the way you pass legislation. That part of my brain still thinks like, oh yeah, what you're talking about is legislation and I don't know if that's still what it is or not but an executive order says, this is what our federal government's going to do and legislation is, hey, you know what, this is what everybody should do. We should have some minimum standards out there. The executive order seems to be well received by the security industry. If anything, I've seen people saying about damn time, like this is a little late, but better late than never. But I think yeah, I think this could also create some momentum towards legislation that says, hey, let's have some minimum security standards in general out there, even if it's just about reporting. Yeah, I think the legislation is a more tricky subject because then you got to figure it, you got to cross eyes and dot tease, right? But like, if you are just in talking about these companies that are dealing with the government, it is certainly responsible for them to do it. And the reason why you can, I'm fine with doing it as an executive order is that what you want is companies not to cheap out. Companies not to say, all right, well we got this money coming in. Do we really need to implement all these things? It's gonna cost the contractors coming in. They know we're getting federal money. They're gonna soak us for it. Do we need to spend it? Yes, yes you do. And I'm glad that it's getting coverage because of Colonial, but you're right. This is because of SolarWinds.  That's why. Yeah, I mean, this was gonna get announced one way or another. The timing of the announcement may have been massaged a little to be like, hey, let's get that EO ready for now because now would be a good time to announce that. I could see that maybe. Scientists from Stanford University published a paper in Nature called High Performance Brain to Text Communication via Handwriting. The paper describes brain-computer interface that reads attempts at handwriting movements from neural activity in the motor cortex and uses a recurrent neural network trained to translate the brain's impulses into text in real time. The real time is the key since previous attempts at things like controlling cursors or attempting to transcribe were fairly slow. System was tried on a 65-year-old person paralyzed from the neck down. That person had two chips implanted in the motor cortex and was told to imagine writing with a pen on paper. The person was able to achieve 90 characters per minute, about 18 words with 94.1% raw accuracy online and greater than 99% accuracy offline with a general-purpose autocorrect. The average phone typing is about 23 words per minute if you wanna compare the two, so in the same neighborhood. The team will conduct more trials to measure efficiency and safety and hope to be able to adapt the software to work with older implant systems. How about that? Yeah, this is clever, right? Because it's saying instead of trying to guess what the person is thinking and turning it into words, let's hijack the system they already have. This would only work on people who already know how to type or write, but let's hijack that part of the brain because it's faster to interpret that part of the brain, apparently. Yeah, you know, I had a conversation with a friend of mine this week about the idea as we've gone through our last tech boom. Some of the biggest follies have been where people tried to guess where the puck is going in the famous metaphor, but they wound up guessing where the puck was going in the next period, not like in the next few seconds. And I think there has been a great amount of tremendous advancement in looking at what we have and just figuring out, okay, but what can we do with this right now instead of trying to define an entire new dynamic for the next 10 years? And I think this is a great example, a great solution for something that is literally life-changing for the folks that would be able to interact with it.  And to be able to, I mean, sure, you know, 90 characters per minute is not a super fast typing situation, but that's incredible. I mean, I'm like, I want to try it, you know, this is not something that I need, but there are plenty of people who really benefit from this. So it's just, it's a really heartwarming advance. Yeah, yeah, no, it is. It's a little ways off from being practical still, but yeah, this is something that once they get it out of the lab and it looks like there's no reason they shouldn't, it's just a matter of when, we'll change people's lives. Well, this may or may not change your life, depends on how much you like Grand Theft Auto, but Intel Labs showed off a new, a convolutional network-based product called Enhancing Photorealism Enhancement. That's what it's called. That creates a photorealistic version of Grand Theft Auto 5 gameplay. The system uses a cityscapes dataset that was built largely from German city streets, real ones, and was able to integrate geometric information from the games. G buffers, they use data like the distance between objects in the game, distance between objects at a camera, quality of textures, the glossiness of a car, for example. The technique is not unlike upscaling that uses machine learning to bump up graphics to higher resolutions. Yeah, so they used the convolutional network in two different places to train the algorithm to intercept the GTA actual information and turn it into a better picture. In one place, they're taking all that geometric information that you're talking about, and they trained it to interpret that and reinterpret the image. And then in another place, this was the more impressive part of the video for me, was how they were able to take the German dataset, which is not the same pictures, right? These are just people in Germany. Right, like in Sunset Boulevard, not in Germany. Well, that's a bicyclist, and this is a bicyclist in GTA. That's close enough, convolutional network, figure out how to make this one look more like that one, and it worked. I mean, this is fascinating. I really, really wonder, I love these kinds of proof of concepts and talk about something that I think is waiting for practical application, these kinds of networks. It's like, we're close. One of these days over the next months or years, we're gonna see something that is very practical and relevant to our daily life and we're gonna be, and nothing will be the same. In the meantime, driving around in GTA 5 could look like driving around in my neighborhood. That, that, that's, I don't know, I don't know if if we both... Somehow the real thing is slightly less exciting, but... I also don't know if we really, if we really hunger for realism in certain things, like would you really want like a photo-realistic Tom and Jerry, or would that just look horrifying? Right. That would look like something on like Live Leak or like Faces of Death. If you look at this video though, I noticed that when you're side-by-side comparing the actual GTA 5 footage with the hyper-realistic, the photo-realistic one, you definitely are like, oh yeah, that looks real and GTA doesn't. When they go full screen though, you start to see like, yeah, but I can tell that's not actually real. Like I can tell it's a little bit computer-y, so it's not perfect, but it's really good. There's also a version trained on the Mapillary Vistas data set instead of cityscapes that shows more vibrant colors if you don't like the gray aspect of the cityscapes data. So they even have a couple different takes on it. All right, let's check out the mailbag. This one comes in from Nick with a K. Nick says, I and most other PS5 owners love what the hardware is capable of and new features of the DualSense controller over what the DualShock 4 offered, but there's surprisingly massive number of PS5 owners and wannabe owners that hate the look of the PS5 hardware. People seem to really hate the black and white color scheme. It's at the point where there are third-party selling custom black side panels to replace the removable panels that come with the PS5 console and people have been asking for an all-black DualSense since the console was unveiled. Nick says, I'm personally indifferent to the color scheme on the console, but given how much grime the white sections of the DualSense can pick up, I'll be getting an all-black DualSense ASAP. All right, always good to get the insight from inside the community on that. Thank you, Nick. Yeah, if you have, if you have insight for us, questions, comments, or all of the above, or something else, feedback at Daily Tech News Show is where to send that email. Shout out to patrons at our master and grandmaster levels. Who will they include today? Well, it's Norm Fezacus, Scott Morris, and Cartond. Also, we have a brand new boss, and that boss's name is Dylan Davis. Dylan, you just started backing us on Patreon and we're throwing you a party. Woo, thank you. We need more people like Dylan. Be like Dylan. You like Dylan. Yeah, Dylan Davis. Double Ds. This party that we're having right now could be for you. It could be your party. All you have to do is back us on Patreon. I've got my drink in hand. I'm not wearing a mask for CDC guidelines. It's great in here. 24 hours in the future from right this second. It could be your name in line. It could be you. It could be. Go do it right now. It's your party. The power is inside you. Speaking of power, Justin, Robert Young, always great to have you on the show. What's been going on since we saw you last? Oh, man, we have a great episode of the Politics, Politics, Politics podcast coming out tomorrow. The return of our great political triad, myself, Andrew Heaton, Jen Briney. We talk about the question of the economy and something that a lot of economists are pouring over because we had a weaker than expected jobs report is the social safety net, which we extended throughout COVID, creating a labor shortage. It is a great unifying topic for me. The elections expert, Heaton, the philosophy expert, and Briney, the legislation expert, to get into, and we talk about all of it, on tomorrow's Politics, Politics, Politics. Man, no lie. I was thinking about Jen Briney when I was reading that executive order, which is like only a few pages, but just reading that executive order, I was like, oh my gosh, Jen does this for much longer things that are much more complicated. Like, it is total respect to Jen Briney at Congress. She's an actual lunatic. Yeah, yeah. Has just gotten to the end of reading the American Rescue Plan. I think her brain might have been melting out of her ear when we were talking. Well, hopefully your brains aren't melting out of your ears, but we have been having such great time with you with us and we're gonna do it all tomorrow. In fact, we're live Monday through Fridays, 4.30 p.m. Eastern, 4.20, 30 UTC. You can find out more at dailytechnewshow.com slash live book market, if you can't remember or tell a friend if you can. We'll be back tomorrow with Rob Dunwood and Len Peralta draw on the stories. Talk to you then. This show is part of the Frog Pants Network. Get more at frogpants.com. Diamond Club hopes you have enjoyed this program.


Hey, this is Brett and this 2015 Dodge Challenger 392 SRT is stock number 14510Z. I am here at Summit Automotive in Fond du Lac, Wisconsin. You're new and use sports car and Dodge Challenger headquarters. This 2015 Dodge Challenger has the 6.4 liter V8 Hemi engine. It's paired up with the 8-speed automatic transmission, puts out 485 horsepower. This car has been fully-safetyed and inspected by our service shop per the state of Wisconsin inspection process. Has a fresh oil and filter change, all the fluids have been checked and topped off, and it is 100% ready to go. Very clean all the way around, that's exactly what I'm going to do in this video. Go all the way around inside, start it up, take a look under the hood, show you all the options, and give you the most accurate representation that I can of the vehicle. Phantom black tri-coat pearl is the color. I shoot all my videos in 4K. If you like the video, subscribe to the YouTube channel, click the bell notifications, get updates in the videos I do each and every day, as well as having access to one of the largest catalogs of vehicles in sports car walk-arounds on YouTube, and stay current on our ever-changing and vast sports car inventory so you do not miss out on gems like this one. This one comes with the 20-inch painted alloy wheels, very glossy paint on those wheels. As the Brembo brakes with the three-piece slotted rotors has the Pirelli P0 Nero 27540 ZR20 tires on here. I would say that they have probably about 60-70% of the tread left on them. This is a two-owner clean title history, clean car facts, and it's been owned in Michigan and Florida. Front bumper and fender are in excellent condition. No dents, dings, scuffs, or scrapes. The lower valance is absolutely perfect. The front bumper has never been drilled into. And the hood is in excellent shape. Probably one of my favorite hoods with the single hood scoop in the center there. But no dents or dings on the hood. Front bumper looks great. Passengers side front fender is in excellent shape as well. And the passengers side front wheel, no major scuffs or scrapes. Check out this paint phantom black tricote, just got a ton of metal flake in it. A lot of silver, some purples, some greens, really a cool color. And the paint is in very nice condition for a 2015. And as you go down this side of this 2015 Dodge Challenger 392 SRT, take note of how clean the body is, how reflective, and mirror-like that paint is. I take these HD videos, so if you are far away, or even if you're close by, you just cannot make the trip down, but you're still interested in purchasing the vehicle. You can see the car, hear the car, and have confidence in what you're looking at before you even get here. So when you do get here, there's absolutely no surprises. And you can make a smart and informed buying decision from wherever you're at. If this video helps you make that buying decision, let your salesmen know that you saw the video. It was helpful and that bread sent you. Back wheel, excellent condition as well. And it does have the Brembo brakes back here, too. Back tires have right around half the tread left on them. And the underbody, see if we can get the light on here. Looks really, really clean. Yeah, looks to really get under there. You can even see that metal flake with my camera light that far away. Very cool color. Coming around to the back, the rear bumper is in great shape. You get the backup parking sensors, the chrome-tipped dual rear exhaust. We're going to start it up here in just a minute. Trunk lid is in excellent shape and you get the LED tail lamps. Trunk area, very nice and clean. The shocks are doing a nice job holding that trunk up. Always something you want to check. And this one does have the Harman Kardon premium sound system with the dual subwoofers, tire and flater kit, and that's where your battery is located as well. Those seats do fall down for extra storage. And that shuts nice and solidly. Coming around to the driver's side, just as clean as that passenger's side. No major dents or dings on the rear quarter. And for full disclosure, this back wheel is just as nice as the rest. All of the wheels on this vehicle are very, very nice. Down the rest of this side of the car, door looks really good. It does have blind spot monitoring, heated mirrors, enter and go system just to have the key fob in your pocket. Inside my favorite Challenger interior, you get the black Laguna leather seats with the SRT embossed in the back rest. These are an option on this car. Look really good. No rips or tears. Power driver seat with lumbar, factory floor mats, auto headlamps, power tilt, telescopic steering wheel. That's working nicely. Easy card and sound, power windows, locks and mirrors, and you get the Laguna leather bolster on the doors. Red seat belts, back seats are in fantastic shape. No rips or tears, smells very clean inside this car. Hop inside, check out the miles, the radio and everything this one has to offer. And then we'll start it up and take a look under the hood. Check out those HID lights in the front. 10,561 miles on this car, you get the 7-inch LCD display, digital spinometer on there, range to empty. You can change those corners to read pretty much whatever you want. Comes with the leather wrapped steering wheel, cruise controls on the right. This one does have the adaptive cruise controls, Bluetooth and information center controls on the left, audio controls on the back and the paddle shifters there. This one comes with the Uconnect 8.43C radio. You get AM, FM and Sirius XM radio capabilities. You also have heated and cooled seat buttons, heated steering wheel controls. You get all your different apps on here, including your driving modes and the performance pages as well. They take a second to load. So while this is loading, I'll show you the climate controls here as well. So get your dual climate controls on there. And then it does have the factory navigation system. And you can see there is Highway 41. So that is working nicely. Always something you want to check on these challengers. Sometimes the navigation systems can get wonky. And with this 8.4 radio, but this one is working nicely. And the different drive modes on here, basically you got track, sport, custom and default. You can change a lot of the settings on there. So that's really cool. And then the performance pages, like I said, they do take a second to load up. And while they're loading down here, you're more tactile, volume, tune and climate controls, including your forward collision warning control, stability control, dual climate controls, and your fan 8-speed automatic transmission. The center console piece is in really nice shape, keyless entry with remote start, which we'll do in just a minute here. And the passenger side format and seat are in excellent condition. Once again, smells very clean inside this vehicle. And the headliner is in really nice shape as well, no rips or tears. You do get map lights right there, home link buttons for your garage door security systems and lane systems, and assistant 911 buttons in the mirror. All right, let's check out these performance pages. You get your timers on here. So there are your timers, your gauges. So you can do zero to 60, zero to 100, eighth mile, quarter mile gauges too, your g-force, and then of course, what's going on with the engine here. So obviously it's off right now, but once we start it up, you'll be able to check that out. So what I'm going to do is go start it from the back of the vehicle, and then we will take a look under the hood. So you got lock it, press it twice, and works nicely. Love those LED tail lamps. All right, so now you have to put your foot on the brake and start it, and now the car is actually started. And you can see there are no check engine lights or anything like that. There is that engine display, some horsepower, torque, and if you rev it a little bit, You can see that those change and your PSI. Take a quick look under the hood here. I would personally like to thank you for checking out the video today, and hopefully from this HD video you've been able to verify the quality condition options and of course, cleanliness of this vehicle all the way around inside. Now I love those H&E headlamps, the LED running lights, and of course projector lamp fog lamps there. Under the hood we have the 6.4 liter 392 V8 Hemi engine, 485 horsepower engine bay is very clean, runs very smooth, and once again this car has been fully safe and inspected by our service shop, has a fresh oil and filter change all the fluids have been checked and topped off, shocks are doing a great job holding that hood up, there is the emission sticker, and this car is 100%. Ready to go. I would highly recommend it from a quality and condition standpoint. I would ship this one anywhere back to Florida, Michigan, California, Texas, New York, whoever is going to get this car is going to be thrilled with it. And to see more pictures of this car, one of other 550 new and used cars, trucks, SUVs, minivans, Wranglers, sports cars, challengers, chargers, mustangs, Camaros, Corvettes, you name it, we got it, go to the website right there, summitauto.com, full pictures and descriptions of every single vehicle all at summitauto.com, and if you want to check out more HD videos you can go to youtube.com slash summitauto. Click the bell notifications, get updates on the videos I do each and every day as well as having access to one of the largest catalogs of vehicle and sports car walkarounds on YouTube and do not miss out on gems like this one by hitting those bell notifications. In fact, in a second you will see a link to subscribe to my YouTube channel on the upper left, a link to all the challenger videos I've ever done in the upper right, a link to this vehicle on our website on the lower left, and a link to one of our latest YouTube videos on lower right, click those, check us out, we're super excited to help you with this Ultra Clean 2015 Dodge Challenger 392 Hemi SRT and Phantom Black Tri-Co Pearl, thank you so much for checking out the video, remember to like, subscribe, and share on the YouTube channel, I really appreciate it. Thanks again, have a great day.


Income tax 2023-2024. Dispositions of business property. Get ready and some coffee because we need to save money for vacation with the help of income tax preparation 2023-2024. Most of this information can be found first. A word from our sponsor. Yeah, actually we're sponsoring ourselves on this one because apparently the merchandisers they don't want to be seen with us.  Like this CPA thinking cap for example. CPA thinking CAP. You see what we did with like with the letters. And this CPA thinking cap is not just for CPAs either. Anyone can and should have at least one possibly multiple CPA thinking caps. Why? Because based on our scientific survey of five people all of whom directly profit from the sale of these CPA thinking caps wearing this CPA thinking cap without a doubt according to the survey. Increases accounting productivity tenfold. Yeah at least. Apparently the hat actually channels like accounting energy from the quantum field ether directly into your head allowing you to navigate spreadsheets faster. It's kind of like how in like the matrix when Neo learns kung fu. Or at least that's what the scientific survey saying. So get one because the scientific survey participants could really use some extra cash. If you would like a commercial free experience consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. 334 tax guide for small business for individuals who use Schedule C tax year 2023 which you can find on the IRS website at iris.gov iris.gov. Looking at the income tax formula the first half basically being an income statement most income statements having income minus expenses resulting in net income here having income minus various deductions resulting in taxable income. So proprietor schedule C rolling into line one income which is kind of unusual because the schedule C itself is basically an income statement. Business income minus business expenses otherwise known as business deductions resulting in in essence net business income which then rolls into line one income of the income tax formula which basically is reflected on the form. 1040 page number one which we see here schedule C ultimately rolling into line eight additional income from schedule one schedule one here additional income and adjustments to income part number one schedule C rolling into line three business income or loss from the schedule C here is a schedule C profit or loss from business which has an income and expense part which means it's formatted like a profit and loss or income statement. All right so now we're looking at dispositions of business property. Remember when we're thinking about the schedule C we're looking at in essence one of the financial statements the performance statement having the income statement income minus expenses the other one being the balance sheet. We don't really see a balance sheet when we're doing a sole proprietorship schedule C but we have some things that we kind of have to track that are balanced sheet items such as for example if we have inventory. Then we have the beginning and ending inventory reported on the cost of good sold calculation. And if we're purchasing large items property plant and equipment buildings for cliffs and so on then we're going to have to have a depreciation schedule which will allocate the cost over the useful life in the form of depreciation expense. Now that that also leads to more complications because now we have to have this whole other schedule which is going to be listing out the types of assets that we have and if we sell those assets we also had depreciation on them. So if we dispose of them or sell them we have to calculate if there's any gain on that and that could be a little bit complex because of the depreciation that we took on it. So we have to be very careful when we have our depreciation schedules to put our assets on them properly in such a way that we can actually tie them out to the actual asset in real life. Meaning we want to make sure that we break up the assets as we put them onto the depreciation schedule rather than grouping a bunch of different fixed assets into one line item. So that when we sell them or dispose of them we can pick each individual one that we sold and disposed. We also want to be adding detailed descriptions as well as any reference numbers that will help us to identify what's on the depreciation schedule to what is there in actual physical fact. So that again when we sell or dispose of them we can figure which item we're selling and disposing of. And then of course once we have that we have to calculate if there's any kind of gain or loss on the sale and then we have the problem of how do we recognize that gain or loss. Do we have favorable capital gains rates or is it going to be ordinary income rates that we're going to have with regards to any gains or losses for example. All right so if you dispose of business property you may have a gain or loss that you report on your tax return. However in some cases you may have a gain that is not taxable or a loss that is not deductible. Now just realize of course that a simple type of business might not have a lot of depreciable property. If you just are a gig worker for example you might not have a whole lot of depreciable property. Some businesses will have a lot more detailed depreciable property such as construction for example because they might have a lot of equipment that is necessary to do their business. So as tax preparers part of our job again is to say what kind of industries do we want to be focused in on and do we want to restrict our focus to particular types of areas because we have a specialization in them or possibly we're trying to be more general and not get too specialized just something to keep in mind. So this chapter discusses whether you have a disposition how to figure the gain or loss and where to report the gain or loss. So useful items so you could go for more information here this is a big topic. You've got the publications you've got the publication 544 sale and other dispositions of assets form and instructions. You can look at form 4797 sales of business property and the related instructions for more information schedule D form 1040 that's the capital gains and losses. So a disposition of property includes the following transactions you sell property for cash or other property. So now again we have property we're selling it we might be thinking mainly depreciable type of property such as equipment for example if we sell it then we're probably going to get cash for it. But oftentimes you might have a trade type of situation or you might get some other property other than cash as we saw with the accounting methods. You still have basically a sale taking place because value has transferred in a like kind of exchange both ways. So you'd still have to basically calculate you think a gain or a loss although in some cases you might have like a like kind situation which we might talk about more in the future. You exchange property for other property so you receive money as a tenant for the cancellation of a lease. You receive money for granting the exclusive use of a copyright through its life in a particular medium. So copyright is basically an asset but it's going to be basically a legal asset you might call it an intangible asset. You transfer property to satisfy a debt. So now we saw this debt situation a little bit when we talked about accounting methods as well. It could be a little bit confusing when we don't get paid basically with cash. But obviously if a debt is canceled then that would be similar to getting cash and you can see that oftentimes if you just kind of infuse the cash within the transaction. Meaning it would be like you got paid for something if you sold the property and then you paid off the debt right instead of the cash going back and forth. You just eliminate the cash but if you imagine the cash involved then you can see why it would be categorized as like a sale for example. You abandoned property so there could be situations where you're saying the property is no use to me anymore.  Well then you're still going to have to basically account for that on the accounting side as though basically kind of like you sold it but you didn't get any money for it. It would be kind of like a disposal generally but we still have to take it off the books as a depreciable asset and account for it. So your bank or other financial institution forecloses on your mortgage or repossesses your property. So this was of course an involuntary sale. They came after the office building or whatever because you didn't pay the loan on it. But from a bookkeeping standpoint it's still basically kind of like a sale of the property that we're going to have to account for in a similar way taken the depreciable property off the books. So your property is damaged destroyed or stolen and you receive property or money in payment. So we have a damage to the property possibly we receive money from it from a legal type of standpoint for the damage caused or possibly from insurance or something like that. Once again we can imagine we might have a depreciable property on the books and it's been removed. We're going to have to remove it from the books so we're still treating it kind of like a sale type of transaction that has happened although it's not like a normal sale for cash. Your property is condemned or disposed of under the threat of condemnation and you receive property or money in payment. So similar situation possibly involuntary here but it's still treated kind of like a sale situation with regards to us taking the property off the books as a depreciable asset. You give property away so this would be like disposing of it. You didn't get any money for it but you gave it away. It'd be like even if you threw it in the trash or something like that you disposed of it. We're still going to have to take it off the books and deal with it if there's any undepreciated amount that is still there at the point in time that that happens. For details about damaged destroyed or stolen property you can see publication 547 casualties disaster and thefts for details about the dispositions C chapter one of publication 544 non taxable exchanges. So obviously one of the things that we want to be careful of with property is the fact that if we sell the property and we have a gain on it then that could be a tax situation where we're going to have to pay taxes on it. So you might have a situation sometimes you might be saying hey look I would like to sell something or or make a move here or upgrade my property or something like that. But I don't want to sell it because I'm going to trigger a gain and then I won't even have enough money to replace the property that I need to replace it with. So you can imagine the tax code has come up with situations scenarios over the years to say hey look we don't want to discourage people from say selling their old equipment and buying like new equipment or something like that because they might be subject to like a gain. Why would they be subject to a gain instead of a loss when equipment usually goes down in value because we allowed them an accelerated depreciation. So you can see the tax code gets all complicated because of its own making in other words they separated capital gains versus ordinary income which causes all kind of complications and then instead of using normal depreciation rules for things like equipment. We put in accelerated depreciation rules to try to incentivize growth in the economy and so on and so forth most likely because lobbyists you know got in there or something like that. So what happens then is that that means that we took expenses greater than we otherwise would which means the value of the book value of the property is now lower than it otherwise would be. And then if you sell the property it's more likely that you're going to have a gain on the sale because you over depreciated it in which case you're going to have a gain. And if there's a gain that's going to disincentivize people from selling the property. So then they're like well how can we incentivize people to sell the property. Well maybe we can kind of eliminate the gain with a light kind exchange kind of system right so this all kind of builds on itself. So in any case certain exchanges of property are not taxable. This means any gain from the exchange is not recognized and you cannot deduct any losses. Your gain or loss will not be recognized until you sell or otherwise dispose of the property you've received. So the general idea would be hey look instead of adjusting the basis of the property. We're just going to say the new property is going to in some way or form take on the basis of the old property so that you will defer the gain until you sell the new property. So then you're then you'll be kind of like in the same situation so that when you sell the new property that's when you'll get hit with the game. All right like kind exchanges. So we have a light kind exchange is the exchange of property for other like kind property. It is the most common type of non taxable exchange to be a light kind exchange the property traded and the property received must be both a real property and be business or investment property. So you get so often times the light kind exchanges gets in place with like real estate for example. And it has a whole world in and of itself to make sure that you qualify for the light kind exchange and when it might be an appropriate thing to do the rules with regards to light kind exchanges have changed basically over time. But you get the general idea of it is that when when in order to facilitate trade and allow people to have transactions. They want to defer the game that's going to be involved because that will cause people not to do the business transactions that they otherwise would because of the taxes. But obviously once you have the light kind changes exchanges in place people will try to be creative to come up with ways that they could maximize their tax benefits from them. So report the exchange of light kind property on form 8 824 light kind exchanges for more information about like kind exchanges. See chapter one of publication 544 installment sales. So an installment sale is a sale of property where you receive at least one payment after the tax year of the sale.  But you only get part of the money in the current year and then you're going to get a series of payments in the future to pay for the property. Well under an accrual accounting method you should record the sale at the point in time that you delivered the property. But from a tax standpoint you didn't actually get paid for it yet. You're going to get paid in the future you have basically an IOU. But because we're talking about large dollar amount items if I sold it for 100,000 and I had a big gain on it or something like that. I wouldn't even have the money to pay the taxes because I just haven't accounts receivable. I have an IOU I don't have the money yet. So then there's a question in terms of well is there a way we can have an installment sale so I can recognize the gain over the life of when I'm actually going to receive the payments. Not at the point in time that the sale took place in terms of exchanging the property. So once again an installment sale is a sale of property where you receive at least one payment after the tax year of the sale. So if you finance the buyer's purchase of the property instead of having the buyer get a loan or mortgage from the third party you probably have an installment sale. So in other words if you think about real estate generally what happens is one person the seller of the real estate owns the property but also has a mortgage alone where the property is collateral on it. The buyer is going to buy the property. So instead of basically what the buyer is going to do is pay for the full amount of the property. And then when the when the seller gets that if it was a hundred thousand dollars they'll take the whole hundred thousand dollars pay off the mortgage. And that's how they'll deal with it. The buyer in order to get the hundred thousand dollars is going to take out their own loan. Right. So the buyer is going to take out a loan to pay off the seller.  But you could imagine a situation where the payments are happening like in installments. Right. So if you if you have the hundred thousand dollars that are going to be paid and you imagine that those are going to be made in installments then the seller is basically financing right the sale. And so you kind of have an installment kind of situation because you made the sale but you've got like an IOU at that point. Okay. So for more information about installment sales you can see publication five three seven. So sale of a business the sale of a business is usually not a sale of one asset. Instead all the assets of the business are sold. So the sale of a business is something that's going to happen when you go out of business and then you're going to sell the property.  Right. It's done. But if you're in a large business that has a lot of capital assets such as construction you're going to have a lot of equipment and whatnot that you're going to have to basically sell. So so or and or you could sell for example the entire business right. And if we're thinking about selling our entire business if we're if we're going out of business or we want to sell the business we can think about the sale of our business to someone else kind of like. It's one thing but in reality you can also think about it as it's basically a bunch of assets that you're basically selling when you sell the business. So when you have larger businesses that are going to be sold the valuation of the business is often something that you're going to hire a third party. To help you specialize in valuing the business and and and then figuring out what kind of gains and what not are going to be resulting from the sale of a business. Okay. So that's kind of a specialty area. Generally when this occurs each asset is treated as being sold separately for determining the treatment of gain or loss. Now this becomes kind of an issue because you'll recall that some types of income might be taxed at different rates. So like capital gains rates are different possibly than ordinary income. So you run into some of these problems in terms of well if there's income one problem is calculating the income and the other problem is are some of the income going to be subject to different rates and so on. Possibly more favorable rates in some cases. So in any case both the buyer and seller involved in the sale of the business must report to the IRS the allocation of the sales price among the business assets. So when the sales price occurs basically you're saying this is the list of equipment and so on that you have and these are the sales prices that are going to be allocated to those pieces of equipment because you can imagine that the new person, the person that buys the business which now has a list of assets if it's a construction company like a bunch of forklifts and whatnot. They're going to have to depreciate those assets right in their business now based on the cost that they paid for those things. So you can use form 8594 asset acquisition statement under section 1016 to provide this information. The buyer and seller should each attach form 8594 to the federal income tax return for the year in which the sale occurred. For more information about the sale of a business you can see publication 544. That's obviously somewhat of a specialty kind of area. How to figure a gain or loss. So if your adjusted basis is more than the amount realized then you have a loss. If your amount realized is more than the adjusted basis you have a gain. So that seems fairly straightforward but you might ask well what is the adjusted basis.  What is the adjusted basis? Well it starts with the cost typically what you paid for the equipment. The cost is what you put on the books though and when you bought it even if you paid cash we did not just expense it at the point in time we purchased it but rather we put it on the books as an asset. If you expensed it you would have already got the tax benefit at the point in time that you bought it but if you put it on the books as an asset then you didn't get a deduction for it. You don't get a deduction until you depreciate it. So as you depreciate it you're getting a tax benefit and you're eating into the basis. So the basis is actually good. That's the cost that you haven't eaten up yet that's going to eat into the gain. The gain being bad for taxes right. So the adjusted basis is the cost minus the depreciation that has been consumed as the basis gets lower. It's more and more likely that the sales price that you sell it for will be greater than the adjusted basis resulting in a gain. Gains being bad for taxes. Now if you're talking about real estate often times you might have a gain because real estate might have gone up in value even though the building could have depreciated in value. But most other kinds of equipment like equipment goes down in value like a forklift, a car, anything goes down in value pretty quickly. So you would think you wouldn't have a gain on those items unless you over depreciate. But over depreciating is quite common because the tax code keeps putting in these accelerated depreciation things in place which means that if you sell something before it's fully depreciated you're probably going to over depreciate it resulting in a gain. So basis adjusted basis amount realized fair market value and amount recognized are defined next. You need to know these definitions to figure your gain or loss basis. The cost or purchase price of property is usually its basis for figuring the gain or loss from its sale or other disposition. However, if you acquire the property by gift, by inheritance or in some way other than buying it you must use a basis other than cost. So in other words, when you bought it that's usually going to be your starting point for the basis. However, what if you didn't buy it? What if you've got it from an inheritance or something? Is the basis then zero? Well, that would not be good for you if it were because the basis is actually good. We want to have a higher basis so that when I sell it I have a less of a gain. So what's going to be the basis on inheritance? Is it the basis of the person that gave it to me? What about if it was a gift? How do I figure the basis in that case? And again, is it the basis of the person who gave it to me? Inheritance, is it the basis of the value at the point in time of death possibly? So again those can get into more complicated, can be quite complicated. So for more information about basis, you can see publication 551, basis of assets, adjusted basis. So this would be the straight basis. Now we're talking about the adjusted basis to it. So straight basis basically cost and then adjustments, adjusted basis. The adjusted basis of property generally is your original cost or other basis plus certain additions and minus certain deductions such as depreciation and casualty losses. So when we talk about adjusted basis, we're taking the cost which you can think of as usually the basis and we're usually depreciating it, meaning we're taking the value of the depreciation method that we had to apply for taxes, typically being for most property a double declining balance in the form of maker's depreciation which we'll talk about in future presentations. In determining gain or loss, the costs of transferring property to a new owner such as selling expenses are added to the adjusted basis of the property so selling expenses can be worked into the calculation as well. Amount realized, generally the amount you realize from a disposition is the total of all money you receive plus the fair market value of all properties or services you receive. So in other words, you're selling property. What's the amount realized? That's basically the sales price. In other words, what did you get for the sale? Usually you would think in dollars but you might have gotten paid in something other than dollars or in addition to dollars in which case if it was property you'd have to take into consideration the fair market value of the property that you have received or you might have gotten paid in services which again you would have to add to the value of the amount realized. The amount realized also includes any of your liabilities that were assumed by the buyer and any liabilities to which the property you transferred is subject such as real estate taxes or mortgage. So on the other side of things, you might have been relieved of debt. So this is the one that often is a little more confusing to people.  So if you've been relieved of things that you owe, liabilities, debts, that's also going to be included in the amount realized. Alright, so the fair market value. What does that mean? Because now we have a situation if I sell stuff for cash, not a problem. But if I sell it for property or services, I have to figure the fair market value because whatever property I've received, I'm going to have to put on my books at fair market value. If services were received, I'm going to have to expense them at the fair market value. How do I calculate fair market value? Fair market value is the price at which the property would change hands between a buyer and seller, neither having to buy or sell and both having reasonable knowledge of all necessary facts. So that's a great theoretical understanding in practice, difficult because some transactions are unique in nature. Meaning, if I get a car, I could look at the book value of the car, the Kelly Blue Book or something, but they might have taken better or worse care of the car and therefore it's unique in nature. So it's difficult to kind of come up to the fair market value exactly a lot of times. But in theory and in practice, that's what we're trying to do. Sometimes we might need an appraisal if it's going to be a large item so that we can at least have a professional try to help us value the property. Amount recognized. So your gain or loss realized from a disposition of property is usually a recognized gain or loss for tax purposes. Recognized gains must be included in gross income. Recognized losses are deductible from gross income. So obviously if we do this calculation, we've got the amount that we received minus the adjusted basis. If it results in a gain amount received over the adjusted basis, you're going to have a gain which you might have to recognize, of course, in gross income. If it was a loss, then you would think you'd be able to deduct it from the gross income. So however, a gain or loss realized from certain exchanges of property is not recognized. See non-taxable exchanges we talked about earlier such as the like kind exchanges. Also, you cannot deduct a loss from the disposition of property held for personal use. So in other words, we're talking here about the schedule C, business property. If you sold your personal car, not your business car, then that would be personal use property and that would have a different situation. If you had a gain or something on a sale of personal property, you might still have to record it maybe as a gain or something, but it would be on the schedule D and it's not really what we're focused on now. We're talking about the business property at this point in time related to the schedule C sole proprietorship. So in my gain or loss, is my gain or loss capital or ordinary? Ordinary or capital, what's that mean? Well, for taxes, normally if we sell things like stock, then we might have gains which we would then call capital gains versus ordinary gains. Why is there a difference? The capital gains might have a favorable tax rate. So if possible, we would like the gain to be subject to capital gain because the tax rates are typically lower than if it was ordinary income in which the tax rates are higher. So you must classify your gains and losses as either ordinary or capital gains or losses. You must do this to figure your net capital gain or loss. Generally, you will have to capital gain or loss if you dispose of capital asset. For the most part, everything you own and use for personal purposes or investment is a capital asset. Certain property you use in your business is not a capital asset. A gain or loss from a disposition of this property is an ordinary gain or loss. So ordinary gain or loss meaning it's going to be reported on like ordinary gain or loss from the Schedule C at ordinary income rates. However, if you held the property longer than one year, you may be able to treat the gain or loss as a capital gain or loss. So that's often a rule for the capital gains or loss. If you held it for an extended period of time, part of the argument for having a more favorable rate is that if you held something for a longer period of time and then sold it like real estate, then you might end up with a large gain. But if you recognize that gain in one year, it's going to push you up into higher tax brackets because of the progressive tax system. And in reality, you didn't get all the gain in one year. It might have taken 10 years to get it, right? And if you were to allocate the gain over 10 years, it wouldn't push you up into as high of tax brackets as taking the 10 years worth of gains and realizing them in one year, right? So that's one of the arguments why people might say, well, capital gains being a lower rate makes some sense for the income tax. So these gains and losses are called, these are section 1231 gains and losses. So for more information about ordering capital gains and losses, you can see chapter 2 and 3 of publication 544. Is my capital gain or loss short term or long term? So if you have a capital gain or loss, you must determine whether it is long term or short term. Whether a gain or loss is long or short term depends on how long you own the property before you dispose of it. So the time you own property before disposing of it is called the holding period. So do I have short term or long term gain or losses? If you hold the property one year or less, then you have short term capital gain or loss, which is typically not as good because it will be more likely subject to ordinary income rather than favorable capital gains rates. If you held the property more than one year, then you have a long term capital gain or loss. Now this actually gets a little bit more complex than this. I don't want to dive into every scenario in detail, but note that if you have a gain, what you would like to do is have the gain at the favorable tax rates, paying less taxes. If you have a loss, then you would like to take the loss against income that's subject to the higher tax rate to the ordinary income tax rates. So it actually gets a little bit complex in terms of the pros and cons with it, but I don't want to get, we're running kind of long here. So for more information about short term and long term capital gains and losses, you can see chapter four of publication 544. Where do I report gains and losses? I'll report gains and losses from the following dispositions on the forms indicated. The instructions for the forms explain how to fill them out. So you got dispositions of business property and depreciable property. So when we have the depreciable property equipment, for example, we're going to use form 4797. If you have taxable gain, you may also have to use the schedule D form 1040. The schedule C form D form 1040 for individual taxpayers is most commonly thought of probably when you have sale of stocks and bonds, for example. And then we have the like kind exchange. So in that situation, you're going to use form 8824. We have installment sales. I'm sorry, the 8824. You may also have to use the form 4797 and schedule D for like kind exchange, which again is kind of a special area. So you might do your research on that one. Installment sale use form 6252. So that's the one where you made a sale, but you're going to get paid in installments. So recognizing all the gain up front would be a problem because you don't have the income yet and possibly you can use the installments to be able to recognize the gain as you get the income. So you can actually pay it possibly. Use form 6252, installment sale income. You may also have to use form 4797 and schedule D form 1040. Casualty and thefts use form 4684 or casualties and theft. You may also have to use form 4797, condemned property. Use form 4797. You may also have to use schedule D.


Hey, hi everyone. Welcome, welcome to the talk. Welcome to Cube Day Singapore. I hope you all had a great keynote session. Unfortunately, I missed it because presentation jitters. So I'm very glad that I have my talk at 10.30 today so that I can be relaxed and attend rest of the sessions. So hi, I'm Anusha. I'm our technical product manager at Nirmata. So as part of my job, Nirmata is a startup. So as part of my job, I do product management. I do a little bit of pre-sales as well. So over the past year, I've been talking to a lot of prospects. And the inspiration for today's talk is based on my various conversation with several prospects. So I see two patterns emerging, which is the first part is raising awareness about Kubernetes security. Because a lot of people pinpoint on just a single thing and they feel that they are securing their environment. So that is the way to go. And the second part is there are some misconceptions or myths around Kubernetes security or security in general. And also, CNCF provides a wide variety of tools. If you check out the CNCF security landscape, there are about 100 tools, I guess. So what tools to use and when to use them at which different stages of your deployment lifecycle. So those are some of the things we'll touch upon today. But before that, I have a question. So how many of you here have experienced a security incident in production? Wow, OK. And how many of you had to deal with it yourself? Like debug, RCA, fixate? Amazing, OK. And for those of you who haven't experienced, I hope you don't have to experience anytime soon. But it's going to happen sooner or later. But let's be prepared for it. So Kubernetes is complex to secure and scale. It is complex, no doubt. It is easy only if you have to do a kind create cluster. Everything other than that is very complex. Because there are a lot of things that you have to take care of. Because everything is configured as a YAML file. Just to deploy a service in production, you have a deployment file, you have a service file, you have to set up ingress, RBAC, and whatnot. So all of these are configuration files. And these are some of the headlines you may have heard in the recent past. There's about log4j vulnerability about Kubernetes instances found exposed online. So love and sacks. So all of this is not old news. This is maybe in the recent one or two years. So Red Hat has done a security report. They have produced a security report. And these are some of the stats out of that report. Like 180% increase in security issues. 93% of them reported a security incident just like this room. And misconfigurations are one of the leading cause. Because everything in Kubernetes is YAML, misconfiguration is common if you have to do all of those manually. So automation is the key. And then what tools are we going to use for that? And this is one of my favorite slides when I have to present to my prospects. To be able to secure your Kubernetes clusters, you need to understand what is the cost of missing it. So sometimes, us as DevOps professionals or SREs, platform professionals, we understand the importance of it. But how do you convince your management to allow you some time? Because you cannot do this overnight. You have to dedicate time for it to invest in security. And management understand numbers. If you want to provide a number or a data-driven approach. So this study was conducted by CNCF. There's a complete detailed study that I've linked. And it's really great. So I'll just explain the first half of this, the top half. So this graph, let's forget about Kubernetes for a bit. Any software, if you find any bugs and you fix it when you're coding, that is to the left side of it, the cost of fixing it is just maybe one developer or two developers, you identify what the issue is.  The cost of fixing it, let's say, is 1x. As opposed to that, something you have already released into production. You identify there's a bug. Now just imagine the cost of fixing that. There are multiple people involved. There are SRE teams who have to triage. There are other teams who have to go find out what the issue is. Maybe you get on multiple calls with different teams and you're spending a lot of time. You're spending a lot of people's time as well. And also your customers may be affected by this. So the loss that you cause by not fixing something that could have been fixed in a coding phase as opposed to finding something in production, it is exponential, it's 640x. Just to put numbers for this, cost per defect pre-production is just $25, but at production level, it is around $16,000. And this is per defect and you can just extrapolate it to a cost per cluster and that is a very big number for me to even read. So I highly recommend for you to read that blog and see how they have, they have given a detailed breakup of how each of these costs add up. Okay, moving on. Okay, I told you about my conversations with prospects. So the first thing that we do is we want to assess what level of Kubernetes maturity the prospect is on. Some are at the very modernization level. Some are already moved some part of their workload to containers, some are still on VMs. They're at different stages. So when I ask what do you do for Kubernetes security or security in general, the most common security measure that teams do today is scanning the images for vulnerabilities. They say that, okay, we are running things like aqua-trivy or something else for scanning images and that's it, but is it enough? I'm sure, if you're not doing anything, just doing this is a good first step. This is definitely necessary, but this is not sufficient.  This is not enough, but you should definitely be doing this. It's not that, you know, replace this with anything else. And the second most security assumption that I get is, you know, hey, I'm using a managed cloud provider. I must be secure by default. I mean, I'm using AWS, right? Like, come on, it's such a big company. They must be doing something for security. They cannot be giving me insecure clusters. So I'm fine. And AWS is just an example, by the way. Same applies for GKE or AKS or any managed cloud provider. But if you read the, you know, cloud provider's security guidelines, there's a very fine print that security is a shared responsibility. So cloud provider clusters, they manage the control plane nodes. They are responsible for upgrading it, patching it, making sure they're secure. But the worker nodes is the customer responsibility. Because, and that is where your actual workloads run. It is your responsibility to secure all of those. Of course, the cloud providers give a very extensive security guidelines on how you should be running your workloads, how you should be configuring your workloads, but doing all of that is not their responsibility. And if something happens, it's on you. Now, the next part is understanding what are the different layers that come in the cloud native security. So this is again, taken from the Kubernetes docs where you have code, container, cluster, and the cloud level. So each of these layers, there are different security best practices that you can follow. And there are different teams in any organization that are involved in securing these different layers. And each of these layer built on the outermost layer. For example, if you allow root users in your containers, it doesn't matter how secure your code is, your code is still vulnerable, because now you're not securing your containers enough.  So each of these layers built on the next layer, we'll see how different teams are involved in securing each of these layers. So in any development or a deployment workflow, we have developed deploy and run phases. In the developed phase, we usually have coding, building and pushing say those images to something like Artifactory. And usually app teams or development teams are responsible for this phase. And in the deploy phase is the DevOps teams who set up different pipelines, ISE pipelines and so on, and make sure your applications are deployed to the cluster or to the cloud. And then finally, the run phase is where your applications actually run. You need to continuously monitor them. If there are some issues, you need to triage and so on. So that's where SRE or platform teams comes into picture. This is not a clear segregation. The lines may be blurred in different organization and different teams may have different set of responsibilities, but this is a sort of a, I don't know, template. And each of these teams should take care to secure their part of the system. And you have to secure every part of the system. It is not like you secure the developed phase and your deploy phases secure by default. No, at every stage, you have to secure. At every stage, you need to have some set of best practices you need to follow or configure policies and so on. Now that we know the attack surface, let's look at what are the different ways different teams can do to achieve some of these security aspects. In the developed phase, the development teams can do container image scanning. So this is you scan your image for CVs and you can also do code scanning by the way which I've not highlighted here. So here you can scan your code for, say best practices in terms of don't expose passwords or secrets or make sure you are using the latest dependencies in your go-mode and so on. And then in the build phase, you can actually sign your container images and when you're storing something like an artifact tree, you need to still be continuously scanning for vulnerabilities because it's not that you scan once for vulnerabilities and you're good. You need to keep scanning them continuously because vulnerabilities can come in any time. And then in the deploy phase, usually the developed team use something like policy-based deployment control. So these policy engines act as admission controllers and they allow you to either block or allow a deployment based on whatever best practices you've configured, based on the policies you've written, you can block or allow certain deployments. And then in the run phase, you still need to do continuous scanning, not that if your deployment was secure at the time of deployment, it's not secure say after two months. So you need to still be scanning for different policies and different security measures and also there might be runtime security events and there are a lot of CNCF tools that are available which we'll look at next. Yes, okay. So there are different tools and a disclaimer here, I've just highlighted few of the tools that I know of and I've used a little bit, but you have to go to the CNCF security tools landscape to see the plethora of tools that are there. So first we have in the, let's start with the develop phase, right? When you're coding. So we have something like Dependabot, SonarCube and Gosec, Dependabot as you all may know, it helps you to keep your dependencies up to date. So it will automatically create a GitHub PR for you and all you have to do is review and merge the request. Similarly, SonarCube is again a static code analysis tool and even Gosec helps you follow all the security best practices in Golang. And those three tools can be part of your GitHub CI itself. And then you have something like SixTor and Notary. So SixTor has a tool called Cosign, so you can use that to sign container images, you can sign YAML artifacts, you can sign basically anything and save the signature in the OCI repository. So it is very important to sign and verify your images so that the image integrity is maintained. And then you have, once you store these images, build these images and store this in an artifact tree, something like Harbor allows you to scan your container registry for vulnerabilities. You can use Trevee and GRIPE as well for scanning your images for CVs. And then in the deploy phase, you have policy engines like Kavanaugh and Gatekeeper, both of these are admission controllers and they allow you to write policies and rules that help in either blocking or allowing the deployments. And then finally in the run phase, we have tools like CubeBench and Falco. So CubeBench helps in generating CIS compliance reports and Falco for runtime events. I think it is based on EBPF, I'm not an expert on it. So you can use these tools in runtime to continuously monitor the state of your clusters. So like I said, these are just few of the tools but there are plenty out there. So lots of things to explore, but you get the idea, right? You need some tools to secure your develop phase, deploy phase and the run phase. Yeah, I want to close with what we have spoken so far.  So here you can identify misconfigurations. Now applying this to a Kubernetes level, everything is YAML manifest. Even your ISE is YAML these days, policies are YAML, everything is YAML. So you can scan for misconfigurations, you can scan for package dependencies, make sure you're using the latest versions only because they are assured to be free of any known CVs. So all of this you can set up in a, say something like a GitHub CI or any of the CI pipelines that you use. And then comes the build phase. This is where you verify, sign and attest. All the images, you can sign the YAML manifest. With cosine, I think you can sign a whole bunch of things that are different types like key signing, keyless signing. So depending on what suits your organization, make sure you're also signing your container images in the build phase and not just building and pushing it. Then in the deploy phase, you have to validate all the images that you've signed. So it's not enough if you just sign them because at the time of deployment, you have to validate those image signatures. Otherwise, what's the point of signing, right? If you're not validating them? Not just the images, you can now also use admission controllers like Kivarno and Gatekeeper that help in verifying all of the different rules or policies that your organization is interested in and your platform teams have defined those policies for you. Then definitely the run phase. You may encounter new issues. So you have to continuously keep scanning. This is especially true for finding new CVs because CVs may come in any time. So you need to be scanning continuously to find new CVs. And again, things like Kivarno helps with writing policies to ensure your scan reports are latest. One of the policies that we usually recommend is write a policy that says my scan report should not be older than 30 days because that gives a sense of confidence that my scan report is always active. And then you can also have policies that don't allow images that have severity higher above. Then you can be rest assured that at least the deployments or the services that are running in your cluster are secure for the time being. Yeah, I think that's all I had. I covered it pretty quick. We have plenty of time for questions. Yes? I see there are a lot of tools you use from each phase. So how do you manage all these tools and learn about all these? And also what the license, are they free or are they licensed? So for me, I will see that the cost of managing all these can be quite high. Yeah, that's a very good point. So like I said, this is again a very subset of tools. This is my opinionated view of the tools. There are again plenty more. But even this is a very huge number for any single team to manage this. And also to gain expertise in each of these tools, how to efficiently use that. That is definitely a challenge. But again, one single team need not manage all of these tools because something like Dependabot and GoSec, your application team may take ownership of it. And then Kivarno or Gatekeeper might be your platform team or your DevOps team. So that is one way to go about it, to distribute between amongst different teams. And these are all CNCF tools. So they are open source, they are free to use. And the way I think some was, I think most of the tools that I've listed here, they usually have a company backing these tools. So there are enterprise versions available if you think just the open source version is not enough or it is too much for you to manage. There are definitely enterprise versions available for most of the tools listed here, I guess. Yeah. Thank you for sharing. Well, we can probably chat later because I don't want this to be a vendor pitch. But Nirmata is mostly for Kivarno. Other questions? All right. I just want to take a picture because my marketing person will kill me otherwise. Yes. Thanks everyone, thank you. I will be in the hallway and happy to chat with you. Thank you.


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What's up everybody Jason for Jasper's case brace calm We just filled up the filler to unlock mosaic basketball patient number two where we're giving away seven spots in the team random filler with this 1920 panini mosaic hobby pack one box one pack break random teams number eight So again guys, this is a 30 spot break for us We'll do the teams and names will randomize customer names and teams should be the hits out of the hobby pack And then at the end of the break will take all 30 customer names randomize them and the top seven get a spot Mosaic team random filler. We only ended up selling 26 spots and we gave away four free spots in this break to the customers that bought in So this is gonna work guys. We're gonna roll the dice We'll randomize the 26 customer names the top four will get pasted here into the randomizer Get an extra spot extra chance to get a spot in the main break And then we'll randomize customer names and teams with the same dice roller then at the end of the break New dice roller new list right there So good luck. Let's roll it and this is four and a set of four and a three seven times So top four get a free spot on this break after seven times one two three four five six and seven boom Mallory James Freddy and Brian Crouch. So there you go after seven times You guys want a free spot in this break And I'll put your little character sign at the end of your guys's name just so you guys know That's the spot you guys want for free And let me quickly just copy and paste this name list For the end of the break Here we go. All right, so then we're gonna use the same dice roll seven times for the names and teams one two three four five six Seven seven down to Brian seven times seven times one Two three four five six and seven Boom seven times seven times Milwaukee Bucks down to the Atlanta Hawks All right seven seven seven Now stick to what you got guys. I'll give you a quick 20 seconds or so to look at your teams But uh, no trades of course, it's a quick little pack filler. There we go. Good luck guys Paris and Barnes George Hill Terrence Mann Cowboy and a little John Moran NBA debut. All right, let's switch scenes now and Let's do the giveaway now. So again top seven get a spot on the team filler Roll it and it is a four or five and a four this time for nine times Good luck one two three four five six seven eight and Nine boom nine times top seven Mallory you are in James your free spot in this break got into the top seven Brandon Hall Russell Brian Crouch Mallory your free spot got into this break Wow and Terry Congratulations guys five and a four nine times Boom top seven are in so you guys are guaranteed a team in the team random And we were just one left away from selling it out and I believe sold out there you go So this will be coming up next and then we'll be able to break mosaic pretty team number two Jasper's case breaks.com. Appreciate it guys