Taxes http://www.wisebread.com/taxonomy/term/4811/all en-US 9 Changes That Will Affect Your Money in 2015 http://www.wisebread.com/9-changes-that-will-affect-your-money-in-2015-0 <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-changes-that-will-affect-your-money-in-2015-0" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/looking-to-future.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As we start 2015, I wanted to pass along&nbsp;nine changes that&rsquo;ll affect&nbsp;your money&nbsp;next year so you can factor them into your financial plans:</p> <p><strong>1. You&rsquo;ll be allowed to stash more money into some types of retirement plans.&nbsp;</strong></p> <p>The maximum contribution limit for&nbsp;<a href="http://www.irs.gov/uac/Newsroom/IRS-Announces-2015-Pension-Plan-Limitations;-Taxpayers-May-Contribute-up-to-$18,000-to-their-401%28k%29-plans-in-2015" target="_blank">401(k) and 403(b)</a>&nbsp;employer-sponsored plans will rise by $500 to $18,000 if you&rsquo;ll be under 50 and to $24,000 (a $6,000 catch-up) if you&rsquo;ll be 50 or older. Those&nbsp;<a href="http://www.nextavenue.org/article/2014-01/5-best-money-strategies-boomers">catch-up contribution</a>&nbsp;boosts for people 50+ are overdue; the catch-up amount has been stuck at $5,550 for a few years.<br /> &nbsp;<br /> Similarly, the maximum contribution for a&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Choosing-a-Retirement-Plan:-SIMPLE-401%28k%29-Plan" target="_blank">SIMPLE 401(k)</a>or a&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-SIMPLE-IRA-Contribution-Limits" target="_blank">SIMPLE IRA</a>&nbsp;&mdash; the type of plans often used by small companies &mdash; will also go up by $500, to $12,500 for those under 50 and to $15,500 (or a $3,000 catch-up) for those 50 and older.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2014-11/7-smart-year-end-tax-moves-prepare-2015">7 Year-End Tax-Saving Moves</a>)<br /> &nbsp;<br /> The news is better still for the self-employed or small business owners who plan to fund&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Retirement-Plans-FAQs-regarding-SEPs-Contributions" target="_blank">SEP IRAs</a>&nbsp;or&nbsp;<a href="http://www.irs.gov/Retirement-Plans/One-Participant-401%28k%29-Plans" target="_blank">Solo 401(k)s</a>&nbsp;in 2015: they&rsquo;ll be allowed to invest $1,000 more than in 2014. The 2015 limit: a bountiful $53,000.</p> <p>&ldquo;In general, we prefer the SEP IRA to a Solo 401(k), because of its overall simplicity,&rdquo; says Joshua Kadish, of the RPG Life Transition Specialists wealth management firm in Chicago, Ill.<br /> &nbsp;<br /> <strong><strong>2. You might finally be able to save for retirement through the Obama Administration&rsquo;s new&nbsp;<a href="https://myra.treasury.gov/" target="_blank">myRA</a>&nbsp;option</strong>.&nbsp;</strong></p> <p>Remember when the President announced this account (myRA, which rhymes with IRA, is short for &ldquo;my retirement account&rdquo;) in his 2014&nbsp;<a href="http://www.nextavenue.org/blog/state-union-and-older-americans">State of the Union&nbsp;</a>address? Well, it&rsquo;s still not available, but will be &mdash; for some people &mdash; &nbsp;in 2015.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/article/2014-12/5-smart-tax-savers-year-end-charitable-giving">Tax Savers for Year-End Charitable Giving</a>)<br /> &nbsp;<br /> The government is now working with a small group of employers participating in a pilot phase of the program. A U.S. Department of Treasury spokesperson told me: &ldquo;Treasury looks forward to working with these employers to refine myRA before it becomes more broadly available in 2015.&rdquo;<br /> &nbsp;<br /> A myRA will be a no-fee Roth IRA for people whose employers don&rsquo;t currently offer retirement plans. The federal government will guarantee myRA income (through special retirement savings bonds) and employee aftertax contributions will be made through payroll deductions. Contributions won&rsquo;t be tax-deductible, but interest earnings will grow tax-free and withdrawals won&rsquo;t be taxed. MyRAs will be limited to individuals with income below $129,000 and to couples with incomes under $151,000.<br /> &nbsp;<br /> There&rsquo;ll be a $15,000 limit on the amount you can accumulate in a myRA over 30 years; after that, the money must be transferred to a Roth IRA account managed by a financial services firm.</p> <p>(<strong>MORE</strong>:&nbsp;<a href="http://www.nextavenue.org/blog/top-10-medical-innovations-2015" target="_blank">Top 10 Medical Innovations for 2015</a>)<br /> &nbsp;<br /> &ldquo;I&rsquo;m not ready to say that everyone should jump on board for a myRA,&rdquo; says Kadish. &ldquo;There may be a benefit for having a tax deductible IRA instead, if you qualify. With a standard Roth IRA, you have 100 percent control over how the money is invested.&rdquo;</p> <p><strong>3. Beginning in 2015, you&rsquo;ll be limited on the number of&nbsp;<a href="http://www.irs.gov/Retirement-Plans/IRA-One-Rollover-Per-Year-Rule" target="_blank">nontaxable IRA rollovers</a>&nbsp;you can make.&nbsp;</strong></p> <p>The Internal Revenue Service will cap them to one every 12 months. The government is doing this to crack down on the loophole that let people effectively get short-term, interest-free loans by taking money out of their IRAs and then depositing the cash into new retirement accounts.<br /> &nbsp;<br /> <strong>4. The income limit to claim the&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Retirement-Savings-Contributions-Credit-%28Saver%E2%80%99s-Credit%29" target="_blank">Saver&rsquo;s Credit</a>&nbsp;will rise a bit, too</strong>.</p> <p>In 2015, it&rsquo;ll be boosted by $1,000 for married couples filing jointly (to adjusted gross income of $61,000) and by $500 for singles (to $30,500). This&nbsp;<a href="http://www.nextavenue.org/article/2014-12/uncle-sam-may-want-give-you-2000-retirement">little-known credit</a>&nbsp;lets qualifying taxpayers get a tax break for contributing to 401(k)s and IRAs.<br /> &nbsp;<br /> <strong><strong>5. The&nbsp;<a href="http://taxfoundation.org/article/2015-tax-brackets" target="_blank">standard deduction</a>&nbsp;will go up by $100 for singles (to $6,300) and by $200 for married couples filing jointly (to $12,600).</strong>&nbsp;</strong></p> <p>As you likely know, you&rsquo;ll be able to itemize your deductions if they&rsquo;ll exceed the standard deduction.</p> <p><strong><strong>6. There&rsquo;ll be teeny increases in the&nbsp;<a href="http://www.irs.gov/uac/Newsroom/In-2015,-Various-Tax-Benefits-Increase-Due-to-Inflation-Adjustments" target="_blank">personal exemption</a>&nbsp;and the amount you can save in a&nbsp;<a href="http://www.irs.gov/uac/Newsroom/In-2015,-Various-Tax-Benefits-Increase-Due-to-Inflation-Adjustments" target="_blank">Flexible Spending Account</a>&nbsp;(FSA) in 2015.</strong>&nbsp;</strong></p> <p>Both will inch up by $50: The personal exemption will be $4,000 (though it&rsquo;ll phase out for singles whose incomes will be $258,250 or higher and for married couples filing jointly with incomes of $309,900 or more). The FSA limit rises to $2,500 next year.</p> <p><strong><strong>7. The&nbsp;<a href="http://taxfoundation.org/article/2015-tax-brackets" target="_blank">Alternative Minimum Tax exemption</a>&nbsp;will go up by about 1.5 percent next year.</strong></strong></p> <p>The exemption amount will be $53,600 for individuals and $83,400 for married couples filing jointly.</p> <p><strong>8. Social Security payments will nudge up, but so will the amount of income subject to Social Security taxes.&nbsp;</strong></p> <p>Benefits checks for the nation&rsquo;s 58 million Social Security recipients will rise by 1.7 percent in 2015, due to the annual&nbsp;<a href="http://www.ssa.gov/news/press/factsheets/colafacts2015.html" target="_blank">Cost of Living Adjustment</a>. That amounts to roughly $22 a month, on average, according to AARP.<br /> &nbsp;<br /> That 1.7 percent increase is a smidge higher than the coming 1.3 percent rise ($1,500) in the portion of income that&rsquo;ll be subject to Social Security tax in 2015. The income ceiling will be $118,500, up from $117,000 in 2014.<br /> &nbsp;<br /> <strong>9. The Obamacare penalty for not having health insurance in 2015 will more than triple</strong>.</p> <p>In 2014, the&nbsp;<a href="https://www.healthcare.gov/fees-exemptions/fee-for-not-being-covered/" target="_blank">Obamacare penalty</a>&nbsp;was $95 per adult or 1 percent of income, whichever was greater; in 2015, it&rsquo;ll shoot up to $325 per adult or 2 percent of income.</p> <p><strong>What Will Be the Same in 2015</strong><br /> &nbsp;<br /> Two things that won&rsquo;t change: the annual&nbsp;<a href="http://www.forbes.com/sites/ashleaebeling/2014/10/30/irs-announces-2015-estate-and-gift-tax-limits" target="_blank">gift tax exclusion</a>&nbsp;(still $14,000) and the&nbsp;<a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits" target="_blank">limits for traditional and Roth IRAs</a>&nbsp;(still $5,500 if you&rsquo;re under 50 and $6,500 if you&rsquo;re 50 or older).</p> <p>&ldquo;The lack of an increase in the IRA limits flies in the face of everything we&rsquo;re hearing about people living longer and needing to save more,&rdquo; says Kadish. &ldquo;There&rsquo;s no rhyme or reason to it.&rdquo;</p> <div class="field field-type-text field-field-blog-teaser"> <div class="field-items"> <div class="field-item odd"> Several retirement contribution limits are raised, Obamacare penalty triples, myRA officially launches and many more tax and social security changes. </div> </div> </div> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p><em>Richard Eisenberg is the senior Web editor of the Money &amp; Security and Work &amp; Purpose channels of <a href="http://www.nextavenue.org/">Next Avenue</a> and Assistant Managing Editor for the site. Follow him on Twitter </em><a href="http://twitter.com/richeis315"><em>@richeis315</em></a><em>. Check out more great articles from Next Avenue:</em></p> <ul> <li><a href="http://www.nextavenue.org/blog/best-places-retire-abroad-2015">The Best Places to Retire Abroad in 2015</a></li> <li><a href="http://www.nextavenue.org/blog/surprising-secrets-successful-retirees">The Surprising Secrets of Successful Retirees</a></li> <li><a href="http://www.nextavenue.org/article/2015-01/3-health-resolutions-you-can-actually-keep-2015">3 Health Resolutions You Can Actually Keep in 2015</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/next-avenue">Next Avenue</a> of <a href="http://www.wisebread.com/9-changes-that-will-affect-your-money-in-2015-0">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now">6 Tax Moves You Need to Make Right Now</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-choose-a-roth-401k-or-a-regular-401k">Should You Choose a Roth 401k or a Regular 401k?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tax-penalties-for-early-retirement-withdrawals">Tax Penalties for Early Retirement Withdrawals</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tax-document-checklist-what-to-gather-before-doing-your-taxes">Tax Document Checklist: What to Gather Before Doing Your Taxes</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement Taxes Wed, 14 Jan 2015 16:00:10 +0000 Next Avenue 1280157 at http://www.wisebread.com You Should Make These 11 Easy Donations Before Time Runs Out http://www.wisebread.com/you-should-make-these-11-easy-donations-before-time-runs-out <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/you-should-make-these-11-easy-donations-before-time-runs-out" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/woman-donation-volunteers-Dollarphotoclub_45319912.jpg" alt="woman donation volunteers" title="woman donation volunteers" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's natural this time of year to feel a little more charitable. Many nonprofit organizations <a href="http://www.slate.com/articles/life/holidays/2013/12/year_end_charitable_giving_most_people_are_terrible_at_it_don_t_be_one_of.html">report that they see a surge of donations in the last month</a> of the year, and there are some advantages to making donations before the calendar turns another page.</p> <p>In addition to keeping with the holiday spirit, giving to charity before year's end ensures that you can get a tax deduction to count for 2014. In in some instances, corporations are in an extra giving mood and will match many cash donations. (See also: <a href="http://www.wisebread.com/15-ways-to-give-to-charity-that-fit-a-holiday-budget?ref=seealso">15 Ways to Give to Charity That Fit a Holiday Budget</a>)</p> <p>If you're feeling charitable or just have some stuff you want to unload, consider these simple donations you can make before 2015 comes around. (Just make sure you keep good records for the tax man!)</p> <h2>1. Clothes and Household Items</h2> <p>There's a good chance you'll get some new clothes and other stuff for the holiday season. Now may be a time to donate some of your older (but still usable) items to a thrift shop or charity such as Goodwill. You'll free up some closet space and get a 2014 tax deduction in the process. This time of year, coats and other warm-weather items are especially needed.</p> <h2>2. Food</h2> <p>Local food pantries are always in need of donations, especially during the winter months. Drop off a few bags of canned goods, or get in touch with a charity such as Meals on Wheels to donate food to a shut-in. You're probably cooking a ton for the holiday feast anyway, so set some aside for a needy family.</p> <h2>3. Shares of Stock</h2> <p>If you've seen portions of your investment portfolio rise in 2014, why not share the wealth? Donating shares of stock is a great way to help out a charity because unlike a cash donation, the contribution may rise in value. You get a tax deduction by donating, and also avoid any capital gains fees you might have otherwise incurred by selling.</p> <h2>4. A Car</h2> <p>If you're thinking of buying a new car in 2015, consider donating your car to charity this year to get the tax benefits. Many charities will accept donations of cars, which they then sell at auctions and pocket the proceeds. Other charities turn the cars over directly to needy families. A car donation is tax deductible, and many charities will even go through the effort to pick up the car from your house free. Donating your car makes sense if you feel like you wouldn't get much for a trade-in anyway.</p> <h2>5. New Toys</h2> <p>It's almost impossible to avoid seeing the U.S Marines manning Toys For Tots stations all over the country. A donation of a new toy will help ensure a great Christmas for an underprivileged child. This year, Toys For Tots is looking to collect 7 million toys. Go to <a href="http://toysfortots.com">Toysfortots.com</a> to find a drop-off location near you.</p> <h2>6. Old Building Materials</h2> <p>When my family built a new addition to our house, we donated some old windows and a sliding glass door to <a href="http://www.loadingdock.org/">a local charity</a> that recycles such things. It was a stress-free way to unload the items, and we got a sizable tax deduction. Contact the <a href="http://bmra.org/">Building Materials ReUse Association</a> to see if there's a charity near you.</p> <h2>7. Your Time</h2> <p>Rather than spending a day at a mall indulging in retail excess, consider taking time to help out at a soup kitchen, food pantry, or other charity. Better yet, consider making a commitment to volunteer not only during this holiday season but throughout the year.</p> <h2>8. Your Artistic Talent</h2> <p>This time of year, it's common for organizations to have parties featuring silent auctions as fundraisers. If you're an artist or photographer, why not donate a painting or photograph? It's a great way to direct money to a charity and perhaps also get some exposure for your skills. Similarly, a musician could volunteer to perform holiday music at a charitable event, or even offer free lessons.</p> <h2>9. Cash</h2> <p>This may seem lazy, but most charities are more than happy to receive monetary donations. In fact, sometimes money is the best gift to a charity because they know better than anyone what specific items they need. Donating cash could be as easy as dropping some coins into a Salvation Army pot, or writing a sizable check to another non-profit group.</p> <h2>10. Blood</h2> <p>This time of year, blood donations are often low because people are so busy. But it's a great way to give back in a way that won't cost you a dime. I make a point of donating blood every December 24 at my local Red Cross donation center. It gets me in the Christmas spirit, and there are usually free cookies. Go to <a href="http://www.redcross.org/">RedCross.org</a> to locate a blood drive or donation center near you.</p> <h2>11. Money to Your Future Self</h2> <p>This may not be a &quot;donation&quot; in the classic sense. But it's still a great idea to try to max out your retirement accounts by the end of the year. If you have an IRA, you can contribute up to $5,500 for 2014. Any contribution up until April 15, 2015 counts toward 2014, but why wait?</p> <p><em>What will you be giving this year? Please share in comments!</em></p> <a href="http://www.wisebread.com/you-should-make-these-11-easy-donations-before-time-runs-out" class="sharethis-link" title="You Should Make These 11 Easy Donations Before Time Runs Out" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/you-should-make-these-11-easy-donations-before-time-runs-out">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ten-great-charities-that-deserve-your-dollars-this-year">Ten Great Charities that Deserve Your Dollars This Year</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/charitable-giving-get-a-receipt">Charitable giving - get a receipt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cleaning-out-for-a-cause-make-a-noncash-tax-deductible-donation">Cleaning Out for a Cause: Make a Noncash Tax-Deductible Donation</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-you-should-donate-a-blood-sucking-timeshare">Why You Should Donate a Blood Sucking Timeshare</a></span> </div> </li> </ul> </div> </div> </div> </div> Frugal Living Taxes charity donations giving tax deductions taxes Wed, 24 Dec 2014 14:00:10 +0000 Tim Lemke 1271198 at http://www.wisebread.com 6 Things the IRS Doesn't Want You to Know About Them http://www.wisebread.com/6-things-the-irs-doesnt-want-you-to-know-about-them <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-things-the-irs-doesnt-want-you-to-know-about-them" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/irs-176603977-small.jpg" alt="irs" title="irs" class="imagecache imagecache-250w" width="250" height="135" /></a> </div> </div> </div> <p>&quot;The rich and the poor are alike; they both worry about taxes.&quot; &mdash; Anon</p> <p>There is perhaps no entity disliked more than the Internal Revenue Service (IRS). It feels the brunt of our disdain during the late winter and early spring each year and &mdash; for some unfortunate souls &mdash; far beyond into the future. The IRS has become the punchline to many jokes in the years since its inception. (See also: <a href="http://www.wisebread.com/15-surprising-facts-about-income-tax?ref=seealso">15 Surprising Facts About Taxes</a>)</p> <p>However, there are secrets that the IRS doesn't want everyone to know. These secrets may make your life a little easier and alleviate some of that anxiety that occurs every year around April 15.</p> <h2>1. People Who Earn Less Than $200K Probably Won't Get Audited</h2> <p>This is great for the average taxpayer. Most of us do not make more than $200,000 a year even with two-income households. Reports show that those making over that amount have a 3% chance of being audited while those making more than $1 million have a 6% chance. Those same reports show that those of us making <a style="text-decoration:none;" href="http://www.forbes.com/sites/anthonynitti/2013/03/25/what-are-your-odds-of-being-audited-by-the-irs/">less than $200,000 have a less than 1% chance</a>. So relax as you hit send on your return each year. You are probably going to be just fine.</p> <h2>2. The IRS Fails to Collect Billions of Taxes Owed Every Year</h2> <p>In recent years, the amount of <a href="http://www.gao.gov/products/GAO-11-272">uncollected tax dollars reached $350 billion</a>! Whether you believe that this unclaimed money should be use for programs or to simply pay down our existing national debt, this is money that Americans are not paying as they should be. (This number is estimated to be low, however, as it depends on people to self-report to estimate what they owe.)</p> <h2>3. The IRS Is Not Really Interested in Seizing Property</h2> <p>If you have gotten behind in paying taxes and are dealing with a collection agent, you may find him or her threatening to seize your property and assets. However, <a href="http://www.investopedia.com/articles/tax/09/enforced-collections.asp">this isn't really their goal</a>, just a threat they like to make to get you into action.</p> <p>Bank accounts are easy to seize and the IRS will do it. However, taking your property and reselling it does not bring in much of a return for the hours and money spent. Your wages can also be garnished relatively easy, and that will be done if you ignore the requests to pay back money owed long enough.</p> <h2>4. Not Every IRS Agent Has a Background in Finance and Taxes</h2> <p>In fact, entry level workers who man the call centers, perform tax audits, and attempt to collect money usually have very little grasp on the tax law. They are trained to perform their jobs in a specific way and may not have the background knowledge required.</p> <p>In addition, it has been found that those you speak to at the IRS can, in fact, <a href="http://www.cbsnews.com/news/irs-cant-do-the-math/">give you the wrong answer</a> almost half the time. For questions about tax law, it is always best to seek the counsel of a trusted CPA or tax attorney.</p> <h2>5. Filing Electronically Saves You a Lot of Hassle</h2> <p>Many issues that arise are due to filing your returns with paper and the USPS. Checks get lost in the mail and delay refunds as well as returns. Numbers get transposed on the forms or addition fails to add up. Social security numbers get entered wrong. All of these things can cause a flag to pop up for a possible audit, delay a refund getting to you, or cause your return to be delayed.</p> <p><a href="https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/Top-Five-Ways-to-Avoid-a-Tax-Audit/INF19031.html">Filing electronically saves you the hassle</a> during the filing process, gets your refund to you quicker, and can give you a peace of mind after you've filed knowing your chances of that audit are reduced.</p> <h2>6. The IRS (or at Least Their Machines) Make Mistakes</h2> <p>Just because the IRS says you owe money, it isn't necessarily so. In fact, the best move you can make when getting an audit notice (especially one that can easily be proven wrong) is to move forward with getting it amended. I actually received a CP-2000 audit notice, claiming I failed to report over $50,000 in income, and it came attached with an $18,000 tax bill, plus fees. It turns out that they mistakenly counted a $600.00 1099-form from a client as a $60,000 1099-form. With the help of a few form letters found on my tax preparer's website and prompt communication, the audit was closed in my favor.</p> <p>Paying income taxes isn't the highlight of anyone's financial life, but for now, it's here to stay. By being informed and remembering that, even the IRS isn't perfect, you can possibly avoid having to pay more than you really owe.</p> <p><em>Do you know any IRS secrets you can reveal? Please share in comments!</em></p> <a href="http://www.wisebread.com/6-things-the-irs-doesnt-want-you-to-know-about-them" class="sharethis-link" title="6 Things the IRS Doesn&#039;t Want You to Know About Them" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/linsey-knerl">Linsey Knerl</a> of <a href="http://www.wisebread.com/6-things-the-irs-doesnt-want-you-to-know-about-them">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-are-your-chances-of-getting-audited-by-the-irs-your-guess-is-probably-wrong">What are your chances of getting audited by the IRS? Your guess is probably wrong</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/taxes-on-irregular-income">Taxes on irregular income</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cant-afford-to-pay-the-irs">Can&#039;t Afford to Pay the IRS?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/top-10-tax-urban-legends-myths-and-rumors">Top 10 Tax Urban Legends, Myths and Rumors.</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes audits IRS taxes Wed, 18 Jun 2014 21:00:04 +0000 Linsey Knerl 1145123 at http://www.wisebread.com 6 Tax Moves You Need to Make Right Now http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-tax-moves-you-need-to-make-right-now" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/thinking-474902869.jpg" alt="thinking" title="thinking" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>With tax day thankfully behind us for another year, the last thing you probably want to think about right now is&hellip; taxes! But this is the ideal time to plan ahead for a less &quot;taxing&quot; April 15th next year. Here are the best moves to make right now. (See also: <a href="http://www.wisebread.com/the-10-worst-tax-moves-you-can-make?ref=seealso">The 10 Worst Tax Moves You Can Make</a>)</p> <h2>1. Estimate Your Taxes</h2> <p>If you're like most taxpayers, you probably got <a href="http://www.wisebread.com/50-smart-things-to-do-with-your-tax-refund">a refund</a> this year. That may have felt like a nice bonus, and it's okay if you treat it as forced savings that may not have happened otherwise. However, getting money back means you overpaid your taxes. And with the average refund weighing in at over $2,800, that's a hefty overpayment.</p> <p>While you have to pay your taxes, you <em>do not</em> have to overpay. To estimate what you'll really owe in federal taxes this year, grab a copy of the return you just filed and pencil in what your numbers are likely to look like this year. Or just visit the <a style="text-decoration:none;" href="http://www.irs.gov/Individuals/IRS-Withholding-Calculator">IRS Withholding Calculator</a>, and run some numbers that way.</p> <p>Next, look at how much federal tax currently is being withheld on your paychecks, multiply it by the number of checks you'll receive this year, and compare it to your estimates. If you're on a path to overpay again this year, contact your employer's HR department and ask to have less withheld from your paycheck. Or, if you're self-employed, lower your quarterly estimated payments accordingly.</p> <p>Now do the same thing with your state taxes, although your state probably doesn't have an online calculator. So, print a form from your state's Department of Revenue or Secretary of State's office website and run the numbers manually.</p> <h2>2. Increase Your Retirement Savings</h2> <p>If you got a big refund this year and plan to follow the advice we just discussed, put some or all of your new monthly surplus into a tax-advantaged retirement savings plan, such as a 401(k) or IRA. That'll strengthen your future financial security and may also reduce your tax bill.</p> <p>At more and more workplaces, employees have a choice between participating in a traditional 401(k) or a Roth 401(k) &mdash; or a traditional or Roth 403(b) if you work for a tax-exempt organization such as a school, charity, or government organization. The main difference between a traditional and a Roth retirement plan is how taxes are treated. With a traditional plan, every dollar you contribute reduces your taxable income. You get the tax break now, and then pay taxes on your contributions and earnings when you withdraw the money in retirement.</p> <p>With a Roth, your contributions do not reduce your taxable income, but when you withdraw money from the account in your later years you can do so tax-free.</p> <p>In general, the decision comes down to a comparison between your tax rate today and an educated guess about your tax rate when you retire. When you're in the early years of your career, chances are your salary isn't very high, so your tax rate isn't very high. You may be better off with a Roth. But if you're on the higher end of the earnings spectrum, you may be better off with a traditional 401(k). If that's you, increasing your contributions this year will lower your tax bill.</p> <p>In 2014, you are eligible to contribute $17,500. Those age 50 and older can contribute another $5,500.</p> <p>If you don't have access to a 401(k), the same advice applies to investing in a traditional or Roth individual retirement account (IRA), although the contribution limits are much lower &mdash; $5,500, and another $1,000 if you are 50 or older.</p> <h2>3. Save for Your Health Care</h2> <p>There are two primary ways to save on taxes when saving for health care costs.</p> <h3>Open a Health Savings Account</h3> <p>An increasingly popular way to pay for health care is to pair a high-deductible health insurance plan with a <a href="http://www.mayoclinic.org/healthy-living/consumer-health/in-depth/health-savings-accounts/art-20044058">health savings account</a> (HSA). The high deductible gets you a relatively low insurance premium. You then you cover the deductible and other out-of-pocket health care expenses by making tax-deductible contributions to an HSA. For individuals, a health insurance plan with a deductible of $1,250 qualifies you for an HSA. For families, the deductible must be at least $2,500. Individuals can then make tax-deductible contributions into an HSA of up $3,300; families can contribute $6,550. One great benefit of an HSA is the ability to roll over unused funds from one year to the next.</p> <h3>Participate in a Flexible Spending Account</h3> <p>If you don't qualify for a health savings account, your employer may offer a flexible spending account (FSA) for out-of-pocket health care costs. This one is a little trickier and not as advantageous as an HSA. Like an HSA, contributions into an FSA reduce your taxable income, but the maximum you can contribute is $2,500 per year, and your employer can only allow you to roll over $500 of unused funds from one year to the next. That means you have to be careful in estimating how much you may spend on health care costs for the coming year.</p> <h2>4. Buy a House</h2> <p>Of course, there are other considerations than taxes when buying a house (like making sure you can actually <em>afford</em> to <a href="http://www.soundmindinvesting.com/visitor/2013/apr/level1.htm">buy a house</a>!), but you may be surprised to find that owning doesn't cost much more, if at all, than renting. That's because you can deduct mortgage interest and property taxes. Print a copy of <a href="http://www.irs.gov/uac/Schedule-A-(Form-1040),-Itemized-Deductions">Schedule A from the IRS</a>, add up your qualifying itemized deductions, and see if it comes to more than your standard deduction ($6,100 for individuals, $12,200 for married couples filing jointly). If so, plug those numbers into the estimates you ran earlier in figuring this year's tax bill and see how home ownership may impact your cash flow.</p> <h2>5. Shore Up Your Emergency Fund</h2> <p>Paying taxes can be painful enough. Paying tax penalties is even worse. And yet, the IRS took in $5.7 billion in <em>penalties</em> from people who withdrew money from their IRA or 401(k) before age 59&frac12;. Some of the early withdrawals can be chalked up to lack of knowledge about better alternatives, such as rolling over your balance penalty- and tax-free into an IRA when leaving your employer. Some of it is due to a lack of other savings. To avoid treating retirement savings as an emergency fund, <a href="http://www.wisebread.com/a-step-by-step-guide-to-creating-your-emergency-fund?ref=seealso">build a real emergency fund</a> by stocking a savings account (online banks typically pay the best interest) with three to six months' worth of essential living expenses.</p> <h2>6. Save for College</h2> <p>Finally, if you have a college-bound child, saving through a 529 plan <em>may</em> reduce your taxes. Every state offers such a plan. While there are no federal income tax deductions available for contributions, some states offer state tax benefits to residents who use their state's plan. Of those, some allow you to take deduction, which lowers your taxable income. Even better, some provide a tax credit, which lowers your tax bill dollar for dollar. Find out what your state offers by searching on the name of your state and &quot;529 plan&quot; or visit <a href="http://www.savingforcollege.com">www.savingforcollege.com</a>.</p> <p><em>What steps have you taken to make the tax laws work in your favor?</em></p> <a href="http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now" class="sharethis-link" title=" 6 Tax Moves You Need to Make Right Now" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="http://www.wisebread.com/6-tax-moves-you-need-to-make-right-now">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-one-third-of-americans-havent-saved-for-retirement">Why One-Third of Americans Haven&#039;t Saved for Retirement</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-why-you-cant-postpone-planning-for-your-retirement-and-how-to-start">This Is Why You Can&#039;t Postpone Planning for Your Retirement (And How to Start)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-unexpected-things-you-should-consider-when-picking-where-you-retire">10 Unexpected Things You Should Consider When Picking Where You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/if-you-want-your-401k-to-grow-stop-doing-these-6-things">If You Want Your 401K to Grow, Stop Doing These 6 Things</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-choose-a-roth-401k-or-a-regular-401k">Should You Choose a Roth 401k or a Regular 401k?</a></span> </div> </li> </ul> </div> </div> </div> </div> Retirement Taxes retirement saving taxes Thu, 22 May 2014 08:12:26 +0000 Matt Bell 1140110 at http://www.wisebread.com Best Money Tips: Reduce Your Food Expenses http://www.wisebread.com/best-money-tips-reduce-your-food-expenses <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-reduce-your-food-expenses" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/groceries-5131294-small.jpg" alt="groceries" title="groceries" class="imagecache imagecache-250w" width="250" height="182" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some great articles on reducing your food expenses, tax day freebies, and steps to investing in yourself.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.narrowbridge.net/5-ways-to-reduce-your-food-expenses/">5 Ways to Reduce Your Food Expenses</a> &mdash; To reduce your food expenses, buy in bulk and limit junk food. [NarrowBridge Finance]</p> <p><a href="http://www.savvysugar.com/Tax-Day-Freebies-2014-34563203">It's Time to Relax and Enjoy These 18 Tax Day Freebies</a> &mdash; This tax day, take advantage of free document shredding at Office Depot. [PopSugar Smart Living]</p> <p><a href="http://moneysmartlife.com/seven-steps-to-investing-in-yourself/">Seven Steps to Investing in Yourself</a> &mdash; Reviewing your career map and considering outsourcing are just a couple steps to investing in yourself. [Money Smart Life]</p> <p><a href="http://www.stretcher.com/stories/14/14apr07h.cfm">5 Spring Home Maintenance Projects</a> &mdash; This spring, inspect your roof and clean your gutters. [TheDollarStretcher.com]</p> <p><a href="http://christianpf.com/your-tax-refund-how-you-should-use-it-and-why-you-should-lose-it/">Your Tax Refund: How You Should Use It and Why You Should Lose It</a> &mdash; Consider using your tax refund to pay off your debt or save for retirement. [Christian PF]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.forbes.com/sites/dorieclark/2014/04/08/how-to-get-noticed-job-hunting-secrets-for-career-changers/">How to Get Noticed - Job Hunting Secrets For Career Changers</a> &mdash; Career changers would be wise to network your way into hidden or unadvertised jobs. [Forbes]</p> <p><a href="http://livingonthecheap.com/7-last-minute-tax-tips-for-procrastinators/">7 last-minute tax tips for procrastinators</a> &mdash; If you procrastinated on your taxes, get professional help if you need it. [Living on the Cheap]</p> <p><a href="http://cashmoneylife.com/roadblocks-to-investing/">Do You See Your Retirement Contributions as a Loss? Getting Past Roadblocks to Investing</a> &mdash; Remedy the loss aversion you feel when you invest by having money contributed to your retirement account before you see it in your checking account. [Cash Money Life]</p> <p><a href="http://onecentatatime.com/the-wonders-and-pitfalls-of-working-from-home/">The Wonders and Pitfalls of Working From Home</a> &mdash; Working from home can maximize your efficiency, but it can also increase distractions. [One Cent at a Time]</p> <p><a href="http://parentingsquad.com/easter-decorations-to-make-with-your-kids">Easter Decorations to Make With Your Kids</a> &mdash; You can make Easter egg centerpieces or a candy terrarium with your kids this Easter. [Parenting Squad]</p> <a href="http://www.wisebread.com/best-money-tips-reduce-your-food-expenses" class="sharethis-link" title="Best Money Tips: Reduce Your Food Expenses" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-reduce-your-food-expenses">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/fresh-fruits-and-vegetables-by-the-month">Fresh Fruits and Vegetables, By the Month</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-5-credit-cards-for-groceries">The Best 5 Credit Cards for Groceries</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/breaking-the-bread-code-how-to-get-the-freshest-loaf">Breaking the Bread Code: How to Get the Freshest Loaf</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-and-worst-times-to-go-grocery-shopping">The Best and Worst Times to Go Grocery Shopping</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes best money tips groceries Tue, 15 Apr 2014 09:24:15 +0000 Ashley Jacobs 1135285 at http://www.wisebread.com Filing Your Taxes for Free Online: How to Do It and What to Expect http://www.wisebread.com/filing-your-taxes-for-free-online-how-to-do-it-and-what-to-expect <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/filing-your-taxes-for-free-online-how-to-do-it-and-what-to-expect" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/laptop-476092861.jpg" alt="woman using laptop" title="woman using laptop" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p><em>Did you know you could file both your federal and state taxes for free if you earned $58,000 or less last year? MyFreeTaxes &mdash; offered through a national partnership between Goodwill Industries International, National Disability Institute, and United Way, and sponsored by the Walmart Foundation &mdash; provides free federal and state tax preparation and filing assistance, both online and in person, to individuals and families earning $58,000 or less a year. </em><a href="http://MyFreeTaxes.com"><em>MyFreeTaxes.com</em></a><em> is the only online platform that can be used to file both federal and state taxes in all 50 states and the District of Columbia. The program has helped millions of individuals and families file for free and claim more than $8 billion in tax credits and refunds since 2009. If you filed an extension or missed the tax deadline, </em><a href="http://MyFreeTaxes.com"><em>MyFreeTaxes.com</em></a><em> is available through October to help you file for free.</em></p> <p>Filing your taxes is easy. To take some of the mystery out of online filing, we've put together an overview on what people can expect when they prepare and file their own taxes through MyFreeTaxes.com.</p> <h2>Know That You Are Not Alone</h2> <p>If you have any questions, or need help along the way, call the MyFreeTaxes Helpline at 1-855-My-Tx-Help (1-855-698-9435) to speak with specialists that have been certified by the IRS.</p> <h2>Step 1: Be Prepared</h2> <p>Print off this&nbsp;<a href="http://www.myfreetaxes.com/get-organized">Tax Preparation Checklist</a>,&nbsp;which lists all of the documents you need to have when preparing your return. You will need the Social Security or Individual Taxpayer Identification Number (ITIN) for each family member. You'll also need your W-2s, 1099s, and other income forms that you should have received from your employer. If you have childcare expenses, make sure you have the provider name and address on hand as well.</p> <h2>Step 2: Get the Facts</h2> <p>When you visit <a href="http://www.MyFreeTaxes.com">MyFreeTaxes.com</a> you can use tools like the Earned Income Tax Credit (EITC) Calculator to see if you qualify for this valuable credit. Once you have your documents ready, click the yellow &quot;File Now&quot; button to begin the filing process.</p> <p><em>TIP: To make sure that you use the free MyFreeTaxes service instead of the paid H&amp;R Block&reg; service, start your return by clicking the yellow &quot;File Now&quot; button on the MyFreeTaxes website.</em></p> <p><em><img width="605" height="376" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-1-ggnoads.jpg" alt="" /></em></p> <h2>Step 3: Create an Account</h2> <p>For the smoothest filing process and to ensure that you receive the free service, create a new account for this year even if you have used H&amp;R Block to file a return in the past. Remember, the free service is only available if your adjusted gross income (AGI) was $58,000 or less in 2013. On the sign in page click &quot;Create Account.&quot;</p> <p><em>TIP: Write down your login information in a safe place so that you can access your return if you need to later on.</em></p> <p><em><img width="605" height="379" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-2-ggnoads.jpg" alt="" /></em></p> <h2>Step 4: Start Your Return</h2> <p>You're ready to start your return! First you'll enter basic information like your name and address. Then, you'll need to answer questions related to what may have changed in the last year (e.g. filing status, residency) so the filing software knows what appropriate forms to include.</p> <p><em>TIP: If you are filing jointly or will be adding family members or children to your return, make sure you have each individual's correct Social Security number or Tax Payer Identification number handy to save you time</em>.</p> <p><img width="605" height="436" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-3-ggnoads.jpg" alt="" /></p> <h2>Step 5: Enter Information From Your 2013 Tax Papers in the Online Form</h2> <p>The software will ask you to input information from your W-2 and other tax forms. For many of them, you simply need to match the numbered boxes on the tax form with the corresponding boxes online.</p> <p><em>TIP: Keep all of your 2013 tax documents in a neat pile on one side of the computer. After you enter the information from a form, move it to the other side of the computer so that you can see which forms you haven't entered yet.</em></p> <p><em><img width="605" height="370" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-4b-ggnoads.jpg" alt="" /></em></p> <p><em><img width="605" height="464" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-5-ggnoads.jpg" alt="" /></em></p> <h2>Step 6: Review Your Return</h2> <p>Prior to submitting your tax return you'll have the opportunity to review and claim applicable tax credits, as well as a final chance to review your entire tax return.</p> <p>Remember, if you have questions at any point when preparing and filing your taxes online through MyFreeTaxes.com, please call our toll-free helpline at 1-855-My-Tx-Help or use the online chat.</p> <p><em>TIP: Make sure to check that all 2013 tax forms have been entered into the system, as some determine your eligibility for valuable tax credits and deductions.</em></p> <p><em><img width="605" height="454" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-6-ggnoads.jpg" alt="" /></em></p> <h2>Step 7: Choose How to Receive Your Refund, and Then Submit Your Return</h2> <p>Taxpayers expecting a refund can choose to have their refund mailed to them or deposited directly into their bank account.</p> <p><em>TIP: The IRS recommends filers choose the direct deposit option so they get their money back quicker.</em></p> <p><em><img width="605" height="455" src="http://www.wisebread.com/files/fruganomics/u784/Blog3-7-ggnoads.jpg" alt="" /></em></p> <h2>Step 8: Pat Yourself on the Back; You Just Prepared and Filed Your Own Taxes!</h2> <h2>Step 9: Check the Status of Your Refund</h2> <p>If you are expecting a refund, check the <a href="http://www.irs.gov/Refunds">IRS website</a> to see where you stand.</p> <h2>Step 10: Make the Most of Your Tax Refund</h2> <p>Here are some <a href="http://www.myfreetaxes.com/make-the-most-of-your-tax-refund/">great ways to use your tax refund</a>.</p> <h2>Step 11: Tell Your Friends and Family That They Don't Have to Pay to File Their Taxes!</h2> <p>You're not the only one who wants to save money by doing their taxes online.&nbsp;</p> <p><span style="font-size: 13px; line-height: 1.7em;">Now that you know what to expect, visit </span><a style="font-size: 13px; line-height: 1.7em;">MyFreeTaxes.com</a><span style="font-size: 13px; line-height: 1.7em;"> and </span><strong style="font-family: inherit; font-style: inherit; line-height: 1.7em;">file your taxes for FREE if you made $58,000 or less last year</strong><span style="font-size: 13px; line-height: 1.7em;">. It's safe, convenient, and easy.</span></p> <a href="http://www.wisebread.com/filing-your-taxes-for-free-online-how-to-do-it-and-what-to-expect" class="sharethis-link" title="Filing Your Taxes for Free Online: How to Do It and What to Expect" rel="nofollow">ShareThis</a><div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p>&nbsp;This is a guest post from MyFreeTaxes.</p> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/myfreetaxes">MyFreeTaxes</a> of <a href="http://www.wisebread.com/filing-your-taxes-for-free-online-how-to-do-it-and-what-to-expect">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tax-document-checklist-what-to-gather-before-doing-your-taxes">Tax Document Checklist: What to Gather Before Doing Your Taxes</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-great-places-to-get-free-tax-advice">6 Great Places to Get Free Tax Advice</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/surprise-5-reasons-you-might-not-get-your-tax-refund">Surprise! 5 Reasons You Might Not Get Your Tax Refund</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-i-have-to-report-this-income-0">Do I Have to Report This Income?</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes Fri, 11 Apr 2014 00:30:29 +0000 MyFreeTaxes 1135177 at http://www.wisebread.com Get a Bigger Refund With These Often-Overlooked Tax Deductions http://www.wisebread.com/get-a-bigger-refund-with-these-often-overlooked-tax-deductions <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/get-a-bigger-refund-with-these-often-overlooked-tax-deductions" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/laptop-175580600.jpg" alt="woman with papers" title="woman with papers" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Everyone knows that there are only two things certain in life: death and taxes. When tax time looms its ugly head, most utter a groan and diligently file their returns. One could argue that the tax code is a confounding minefield purposely written to confuse and frustrate. The following deductions are underused (and perfectly legal) ways to ensure you keep as many of your hard earned dollars as possible. (See also: <a href="http://www.wisebread.com/stupid-tax-return-mistakes-that-will-get-you-audited?ref=seealso">Stupid Tax Return Mistakes</a>)</p> <p>Before deducting to your heart's content, remember to document everything. Keep your receipts and other proof so you don't find yourself in a pickle if the tax man comes knocking on your door. There may be limitations on your ability to claim these deductions. Consult a certified public accountant if you have any questions, concerns, or if you are completely out of your element.</p> <h2>1. Gambling</h2> <p>Who doesn't like a little misappropriation of personal funds? When you find yourself a few too many cocktails deep and sitting at the blackjack table with your inhibitions lowered, it's easy to lose your hard earned cash. Don't worry, Mr. Tax Man feels your pain.</p> <p>Whether you lingered at the roulette table for too long or have a penchant for quick pick lottery tickets, you can ask Uncle Sam to take pity on your wallet and deduct your losses. If it sounds too good to be true, that's because <a href="http://www.irs.gov/uac/Newsroom/Five-Important-Tips-on-Gambling-Income-and-Losses-1">there is a catch</a>. If you're going to claim gambling losses, you must report your winnings as well.</p> <p>As an added twist, you can only claim losses to the extent of your winnings. So if you pay $100 on scratch offs but only recoup $50, you can only claim $50 in losses; the other $50 is the price of playing the game.</p> <h2>2. Student Loan Interest</h2> <p>Those of you who are all too familiar with the crippling debt incurred from pursuing higher education know that the interest rates on student loans can be especially unforgiving. Before you start lamenting the money that hasn't even gone toward paying your premiums, the IRS is here to help ease the pain. (See also: <a href="http://www.wisebread.com/what-recent-grads-must-know-to-repay-federal-student-loans?ref=seealso">What Recent Grads Must Know To Repay Federal Student Loans</a>)</p> <p>Folks who are legally obligated to pay back their student loans can deduct the interest that they have paid in doing so. Even if you are lucky enough to have parents that repay your loans, you can still claim the interest paid since you are the one liable for the debt. The IRS even has a <a href="http://www.irs.gov/uac/Can-I-Claim-a-Deduction-For-Student-Loan-Interest%3F">handy 10 minute quiz</a> you can take to see if you're eligible.</p> <h2>3. Charitable Expenses</h2> <p>Most people are aware that charitable contributions to qualified organizations are deductible on your taxes, but the IRS's definition of &quot;charitable&quot; is somewhat of an ambiguous grey area. While you can't deduct the time you volunteer to charity, you can claim <a href="http://www.mainstreet.com/article/moneyinvesting/taxes/document-your-charitable-deductions-taxpayers?page=3">out-of-pocket expenses</a> you incur on your philanthropic adventures. Did you bake cookies for a school fundraiser? The ingredients are tax deductible. Did you attend a swanky charity ball? You can deduct the mileage it took to get there. (See also: <a href="http://www.wisebread.com/surprising-charitable-tax-deductions?ref=seealso">Surprising Charitable Tax Deductions</a>)</p> <p>There was even a woman who was able to deduct the cost of her babysitter because her work at a local charity made the sitter necessary, although this might be more trouble than it's worth since the IRS took her to court to justify the claim.</p> <h2>4. Gadgets and Technology</h2> <p>In a world where technology is king, keeping up with the latest gadgets can be mighty expensive. So it's a good thing that the government will step in to help offset some of the cost. If you use your phone or computer exclusively for business, you can claim 100% of the cost, including your monthly cell phone bill.</p> <p>If you use you use your smartphone to post pictures of your lunch to Instagram, don't fret. If your tech gizmo of choice acts as both your business and personal device, you can deduct the portion used for business from your taxable income.</p> <p>These tax breaks don't just include new PCs or the latest smartphone. Printers, Internet service, cable TV, and <a href="https://turbotax.intuit.com/tax-tools/tax-tips/Tax-Deductions-and-Credits/Mobile-Phones--Internet-and-Other-Easy-Tax-Deductions/INF17751.html">more can be deducted</a>. Of course, you will be required to keep meticulous records if you are asked to substantiate your claims.</p> <h2>5. Searching for a Job</h2> <p>It makes sense that the IRS would want to help people find work; it's in their best interest to have you earning money so that you can pay the tax man. So it comes as no surprise that Uncle Sam is willing to give a little back when you find yourself neck deep in the dog-eat-dog world of job hunting. (See also: <a href="http://www.wisebread.com/6-tax-deductions-job-hunters-can-t-afford-to-overlook?ref=seealso">Tax Deductions for Job Hunters</a>)</p> <p>You can claim transportation costs such as gas, tolls, and parking; you can even write off printing expenses for resumes and business cards. But before you go too crazy, knot that the government has its share of restrictions. Your job search costs are considered miscellaneous expenses. As such you have to itemize all of your deductions, and they have to be more than 2% of your annual gross income.</p> <p>Of course there are <a href="http://www.marketwatch.com/story/deducting-jobhunting-expenses-1348080899718">other stipulations</a>, so make sure you do your homework.</p> <p><em>Do you know of any law-abiding taxation loopholes? Share your financial wizardry in the comments!</em></p> <a href="http://www.wisebread.com/get-a-bigger-refund-with-these-often-overlooked-tax-deductions" class="sharethis-link" title="Get a Bigger Refund With These Often-Overlooked Tax Deductions" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ryan-lynch">Ryan Lynch</a> of <a href="http://www.wisebread.com/get-a-bigger-refund-with-these-often-overlooked-tax-deductions">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/surprise-5-reasons-you-might-not-get-your-tax-refund">Surprise! 5 Reasons You Might Not Get Your Tax Refund</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-marriage-penalty-of-taxes-in-america-how-does-it-affect-you">The &quot;marriage penalty&quot; of taxes in America - how does it affect you?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-10-worst-tax-moves-you-can-make">The 10 Worst Tax Moves You Can Make</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes deductions tax refund taxes Wed, 02 Apr 2014 08:36:11 +0000 Ryan Lynch 1133959 at http://www.wisebread.com Best Money Tips: Useful Things to Do With Your Tax Refund http://www.wisebread.com/best-money-tips-useful-things-to-do-with-your-tax-refund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-useful-things-to-do-with-your-tax-refund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/cash-469820629.jpg" alt="coins" title="coins" class="imagecache imagecache-250w" width="250" height="156" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some fantastic articles on useful things to do with your tax refund money, when renting makes more sense than buying, and reasons to use a cash-only spending plan.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.thesimpledollar.com/ten-useful-things-to-do-with-your-tax-return-money/">Ten Useful Things To Do With Your Tax Return Money</a> &mdash; Fixing up your home and bolstering your emergency fund are just a couple good ways to use your tax refund money. [The Simple Dollar]</p> <p><a href="http://cashmoneylife.com/when-is-renting-better-than-buying/">Five Situations Where Renting Makes More Sense Than Owning a Home</a> &mdash; It makes more sense to rent when owning would leave you broke. [Cash Money Life]</p> <p><a href="http://www.stretcher.com/stories/07/07mar19b.cfm?slider">10 Reasons to Use a Cash-Only Spending Plan</a> &mdash; Using a cash-only spending plan helps you better learn the value of a dollar. [TheDollarStretcher.com]</p> <p><a href="http://ptmoney.com/travel-hacker-vacation-dollar-goes-furthest/">Not a Travel Hacker? Vacation Where and When Your Dollar Goes Furthest</a> &mdash; Save money when traveling by opting to stay away from touristy things and be more like a local. [PT Money]</p> <p><a href="http://www.carefulcents.com/make-room-for-your-side-business/">3 Ways to Harmoniously Blend Your Side Business Alongside Your Full-Time Job</a> &mdash; Negotiating with your boss for office freedom can help you blend your side business and full-time job. [Careful Cents]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.savvysugar.com/How-Feel-Like-Child-Again-24186170">16 Ways to Feel Like a Kid Again</a> &mdash; To feel like a kid again, make a mix CD or make s'mores. [PopSugar Smart Living]</p> <p><a href="http://livingonthecheap.com/want-summer-camp-deals-start-looking-now/">Want summer camp deals? Start looking now</a> &mdash; It is important to consider the type of camp experience you want for your child as well as what you can afford. [Living on the Cheap]</p> <p><a href="http://moneyning.com/investing/2-behavioral-biases-that-are-making-you-lose-money/">2 Behavioral Biases That Are Making You Lose Money</a> &mdash; Familiarity may be negatively affecting your portfolio and causing you to lose money. [MoneyNing]</p> <p><a href="http://parentingsquad.com/perfect-preschool-flower-crafts-to-brighten-up-your-home-this-spring">Perfect Preschool Flower Crafts to Brighten Up Your Home This Spring</a> &mdash; Consider making a flower bouquet canvas with your kids to brighten up your home. [Parenting Squad]</p> <p><a href="http://www.americandebtproject.com/2014/03/create-your-own-personalized-privacy-policy/">Create Your Own Personalized Privacy Policy</a> &mdash; Create your own personalized privacy policy can help protect yourself and your business. [American Debt Project]</p> <a href="http://www.wisebread.com/best-money-tips-useful-things-to-do-with-your-tax-refund" class="sharethis-link" title="Best Money Tips: Useful Things to Do With Your Tax Refund" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-useful-things-to-do-with-your-tax-refund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-a-bigger-refund-with-these-often-overlooked-tax-deductions">Get a Bigger Refund With These Often-Overlooked Tax Deductions</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/surprise-5-reasons-you-might-not-get-your-tax-refund">Surprise! 5 Reasons You Might Not Get Your Tax Refund</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-marriage-penalty-of-taxes-in-america-how-does-it-affect-you">The &quot;marriage penalty&quot; of taxes in America - how does it affect you?</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes best money tips tax refund taxes Tue, 25 Mar 2014 10:00:18 +0000 Ashley Jacobs 1132789 at http://www.wisebread.com Turn Last Year's Taxes Into This Year's Financial Spring Cleaning http://www.wisebread.com/turn-last-years-taxes-into-this-years-financial-spring-cleaning <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/turn-last-years-taxes-into-this-years-financial-spring-cleaning" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/finances-466009147.jpg" alt="finances" title="finances" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>It's tax time again, the time of year when Americans sift through the pile of papers on or near (and sometimes in) their filing cabinets in search of those elusive tax documents. Where'd the W-2s go? What happened to the 1099 from the bank?</p> <p>It's also the time of year we promise to do a better job sorting and filing for next year's taxes. Make this year the year you keep that promise. Or take it a step further and make tax time an opportunity to look ahead, financially speaking, rather than only look back at last year. After all, you probably have a clearer picture of your current financial situation right after doing your taxes than at any other time.</p> <p>Let's start with the tax documents, and then let's look at what else we can tidy up.</p> <h2>Wrangle Your Tax Documents</h2> <p>All that stuff you spent the day tracking down? Keep it in one place for next year. Include a <a href="http://www.irs.com/articles/tax-form-checklist">checklist</a> so you can keep track of documents as you receive them &mdash; or to know what to go looking for if you haven't. Also include on your checklist some personal info: Names, Dates of Birth, Social Security numbers for you, your spouse or partner, and every dependent you claim. These details will be handy for all sorts of other purposes, too.</p> <h3>Make a Simple Two Folder System for the Key Documents</h3> <p>Make one folder for all of your income documents such as W-2s from employers, 1099s for contract work, for interest income, gambling winnings, income from investment sales, rental income, whatever. Refer to your checklist!</p> <p>Make a second folder for your income adjustments and credits. Mortgage interest is the big one here, but there are lots &mdash; IRA contributions, charitable contributions, education expenses. As you receive receipts and statements for these, just drop them in your folder. Next March or April you'll be ready to go, and probably feeling proud of your sensible filing.</p> <h3>Consider Digital Files</h3> <p>Lots of financial institutions give us the option to receive digital copies of our statements and tax documents &mdash; various 1099s for instance, or the 1098 for interest paid on student loan debt. It's cheaper for them, and it cuts down on paper waste. As you receive these, save them in specific folders on your computer (say, &quot;Income&quot; and &quot;Credits&quot;). They'll be waiting for you at tax time next year.</p> <p>Every year when I'm doing my taxes I have to run out to the garage to take a look at annual car registration fees paid for each of our two cars. This year I've taken snapshots of the renewal documents with my smartphone and uploaded them to Evernote. (I could have just added them to my &quot;Income Adjustments&quot; folder, too.) Next year I won't have to run out to the car. I've done the same with my property tax bills. You can do this for any paper receipts you receive and would like to keep for tax purposes.</p> <p><strong>Note:</strong> Many institutions will charge a fee to access older statements. Check with your bank or lender. If you need to keep copies of these records for your taxes or for retention, be sure to download them and store them safely (whether digitally or as print outs) &mdash; and don't forget to back them up.</p> <h3>Reconsider Your Withholding</h3> <p>Most personal finance gurus advise against too much income withholding. Despite that, on average, <a href="http://money.cnn.com/2012/01/10/pf/taxes/tax_refund/">Americans withhold an extra $3,000</a> in income tax every year &mdash; $250 a month. While it's nice to get a $3000 check every spring, it's not the smartest use of <em>your</em> money. It's not even the smartest way to get a $3000 &quot;bonus&quot; every year.</p> <p>With the details fresh in your mind after finishing your taxes, visit the <a href="http://www.irs.gov/Individuals/IRS-Withholding-Calculator">IRS' Withholding Calculator </a>and figure out how much you should be sending the government out of every paycheck to bring that refund closer to $500. When you ask HR to make the change, also ask that they redirect the same amount into a savings account. You won't notice much, if any, change on your paystub, but you will have a growing savings account &mdash; one that's earning interest.</p> <h2>Create a Basic File System</h2> <p>I've outlined a simple two-folder file system for your taxes above. If you don't already have a file system for the rest of your Important Documents, consider setting one up.</p> <p>In addition to my two tax folders, I keep several folders for my freelance work as a writer and editor (basically income and expense), and for the household I keep folders for:</p> <ul> <li>insurance policies (life, homeowner's, auto, earthquake, flood [beach living!])<br /> &nbsp;</li> <li>home maintenance receipts for repairs and supplies, as well as for major appliances<br /> &nbsp;</li> <li>bills paid<br /> &nbsp;</li> <li>bank and credit card statements (only recently went paperless)<br /> &nbsp;</li> <li>mortgage documents<br /> &nbsp;</li> <li>passports and Other Important Stuff like SS cards, birth certificates, diplomas, etc.</li> </ul> <h2>Start Budgeting</h2> <p>You have all the details on your income. And some of the details on your spending. Why not expend a little more effort <a href="http://www.wisebread.com/build-a-better-budget-in-5-minutes-flat">to create a budget</a>? Most banks now offer robust online tools for tracking spending on credit cards and to monitor income and spending made through checking, and savings accounts. That's a good start. You can take it a step further by using a service such as <a href="https://www.manilla.com/">Manilla</a> to consolidate and monitor all your bills and help you track your spending.</p> <h2>Evaluate Your Retirement Savings</h2> <p>Can you save more? Can you make a contribution now, before you file, and repay your savings or checking account with your refund? You'll get a break on your taxes, and you will have done something nice for your future self.</p> <p>Now is also a good time to rebalance your funding allocation between riskier stocks and safer bonds. Depending on the performance of your portfolio over the last year, gains (or losses) have changed the balance of your investment, most likely toward riskier stocks, which may or may not be in alignment with your investment goals and risk tolerance.</p> <h2>Evaluate Your Debt</h2> <p>If you're like most Americans, you're carrying at least a little credit card debt. Maybe a lot. Do you know how much interest you're paying? Do you have a plan for paying that balance off?</p> <p>Get a handle on those details and start figuring out how to get away from that debt. A good first step is to commit some of your refund to those balances.</p> <h2>Check Your Credit Report</h2> <p>Speaking of credit. You're entitled to one free look at your credit report from each of the three major credit bureaus every year. Don't visit one of those services that advertise on TV with the catchy jingles (they'll try to sell you some other services you may not need). Just go to the only <a href="https://www.annualcreditreport.com/index.action">annual credit report website</a> authorized by <a href="http://www.consumer.ftc.gov/articles/0155-free-credit-reports">federal government</a> to provide consumers with reports from the leading bureaus. Find anything amiss? Learn how to correct <a href="http://www.consumerfinance.gov/askcfpb/313/what-should-i-look-for-in-my-credit-report-what-are-a-few-of-the-common-credit-report-errors.html">credit reporting errors</a>.</p> <p>For more tips on<em> </em>Financial Spring Cleaning, join me and our Senior Editor, Meg Favreau, as well as Kristen Chase of Cool Mom Picks and Marc Karasu of Manilla on <strong>Wednesday, March 26 at 3:30pm ET</strong> for a <a href="https://plus.google.com/events/c3f26hh8k3dsmi44tg54f1ns8lg">Google+ Hangout</a>. The Hangout will answer questions about how to de-clutter and organize your financial life this spring. Whether you&rsquo;re trying to get your financial paperwork in order to prepare your taxes, or want to do some financial spring cleaning in order to simplify your life, the conversation will provide participants with helpful tips, tricks and digital tools to be more productive, get control of your money, and start spring on a fresh financial note.</p> <p><em> </em></p> <p><em><a href="http://r1.fmpub.net/?k1=cmx-metric&amp;k2=289|10&amp;k3=logo&amp;k4=&amp;r=http%3A%2F%2Fwww.citi.com%2Fmobile"><img src="http://vc.cdn.fm/video_conversationalist/system/published/opportunity/8758310/Citi_Logo_125x125.jpg" alt="" /></a></em></p> <p><em>This post is brought to you by Citi. Learn more about the tools Citi offers to help simplify your financial life at <a rel="nofollow" href="http://r1.fmpub.net/?k1=cmx-metric&amp;k2=289%7C10&amp;k3=disclaimer&amp;k4=&amp;r=http%3A%2F%2Fatwww.citi.com%2Fmobile">www.citi.com/mobile</a>.&nbsp;</em></p> <p><em>This content is not provided or commissioned by Citi. Opinions expressed here are author&rsquo;s alone, not those of Citi, and have not been reviewed, approved or otherwise endorsed by Citi.</em></p> <p><img width="0" height="0" src="http://r1.fmpub.net/?k1=cmx-metric&amp;k2=289|10&amp;k3=&amp;k4=&amp;img=true" alt="" /><img width="0" height="0" src="http://ap.lijit.com/www/delivery/retarget.php?p=FMC&amp;add_c87583=1&amp;add_s289=1&amp;add_n101=1" alt="" /><img width="0" height="0" src="http://pixel.mathtag.com/event/img?mt_id=336069&amp;mt_adid=115091&amp;v2=s289&amp;v3=n101&amp;s1=c87583" alt="" /></p> <p>&nbsp;</p> <p>&nbsp;</p> <a href="http://www.wisebread.com/turn-last-years-taxes-into-this-years-financial-spring-cleaning" class="sharethis-link" title="Turn Last Year&#039;s Taxes Into This Year&#039;s Financial Spring Cleaning" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/lars-peterson">Lars Peterson</a> of <a href="http://www.wisebread.com/turn-last-years-taxes-into-this-years-financial-spring-cleaning">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/surprise-5-reasons-you-might-not-get-your-tax-refund">Surprise! 5 Reasons You Might Not Get Your Tax Refund</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-if-i-skip-my-taxes-this-year">What If I Skip My Taxes This Year?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-survive-a-tax-audit">How to Survive a Tax Audit</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/five-easy-steps-to-keeping-track-of-expenses-for-the-self-employed">Five Easy Steps to Keeping Track of Expenses for the Self-Employed</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/irs-delays-start-of-tax-filing-for-some-taxpayers-in-2011">IRS Delays Start of Tax Filing for Some Taxpayers in 2011</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes federal taxes files filing taxes financial planning Tue, 18 Mar 2014 10:24:11 +0000 Lars Peterson 1131591 at http://www.wisebread.com Best Money Tips: Commonly Overlooked Tax Deductions http://www.wisebread.com/best-money-tips-commonly-overlooked-tax-deductions <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-commonly-overlooked-tax-deductions" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/magnifying-4057616-small.jpg" alt="magnifying glass" title="magnifying glass" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some stellar articles on commonly overlooked tax deductions, where you can learn home improvement skills, and tips for escalating your productivity.</p> <h2>Top 5 Articles</h2> <p><a href="http://ptmoney.com/tax-deductions-commonly-overlooked/">10 Commonly Overlooked Tax Deductions for 2014</a> &mdash; Don't overlook the tax deductions of state sales tax and jury duty pay. [PT Money]</p> <p><a href="http://lifehacker.com/where-can-i-learn-home-improvement-skills-1535195959">Where Can I Learn Home Improvement Skills?</a> &mdash; You can learn home improvement skills at your local hardware store or via technology. [Lifehacker]</p> <p><a href="http://www.dumblittleman.com/2014/03/10-tools-tips-for-escalating-your.html">10 Tools &amp; Tips For Escalating Your Productivity</a> &mdash; To increase your productivity, utilize your commute time and take breaks. [Dumb Little Man]</p> <p><a href="http://www.mainstreet.com/article/moneyinvesting/insurance/finance-must-do-2014-often-forgotten">This Finance Must-Do in 2014 Is Often Forgotten</a> &mdash; If you are renting your home or apartment in 2014, get renter's insurance! [MainStreet]</p> <p><a href="http://frugalportland.com/the-essential-items-in-a-minimalist-closet/">The Essential Items in a Minimalist's Closet</a> &mdash; Every minimalist should have two or three pairs of jeans in their closet. [Frugal Portland]</p> <h2>Other Essential Reading</h2> <p><a href="http://parentingsquad.com/little-things-go-a-long-way-4-tricks-that-make-being-a-mom-easier">8 Tax Breaks You Should Take Advantage of Now Before They Expire</a> &mdash; Take advantage of tax credits for energy-efficient homes and appliances and tax credits for electric vehicles. [PopSugar Smart Living]</p> <p><a href="http://www.marcandangel.com/2014/03/02/40-regrets-you-dont-want-to-have-in-40-years/">40 Regrets You Don't Want to Have in 40 Years</a> &mdash; Make sure you don't have the regrets of ignoring your intuition or letting your health go. [Marc and Angel Hack Life]</p> <p><a href="http://www.lifehack.org/articles/lifestyle/10-simple-ways-cure-hangover-effectively.html">10 Simple Ways To Cure A Hangover Effectively</a> &mdash; Cure your hangover effectively by drinking coffee and eating honey on toast or crackers. [Stepcase Lifehack]</p> <p><a href="http://timemanagementninja.com/2014/02/5-work-from-home-habits-that-are-killing-your-productivity/">5 Work from Home Habits That Kill Your Productivity</a> &mdash; Starting your day without a plan can kill your productivity if you work from home. [Time Management Ninja]</p> <p><a href="http://parentingsquad.com/little-things-go-a-long-way-4-tricks-that-make-being-a-mom-easier">Little Things Go a Long Way: 4 Tricks That Make Being a Mom Easier</a> &mdash; To make being a mom easier, don't be afraid to delegate. [Parenting Squad]</p> <a href="http://www.wisebread.com/best-money-tips-commonly-overlooked-tax-deductions" class="sharethis-link" title="Best Money Tips: Commonly Overlooked Tax Deductions" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-commonly-overlooked-tax-deductions">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-10"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-tax-deductions-you-can-never-take">3 Tax Deductions You Can Never Take</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/16-great-tax-deductions-you-may-have-overlooked">16 Great Tax Deductions You May Have Overlooked</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-should-make-these-11-easy-donations-before-time-runs-out">You Should Make These 11 Easy Donations Before Time Runs Out</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/cleaning-out-for-a-cause-make-a-noncash-tax-deductible-donation">Cleaning Out for a Cause: Make a Noncash Tax-Deductible Donation</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes best money tips tax deductions Thu, 06 Mar 2014 11:00:26 +0000 Ashley Jacobs 1129456 at http://www.wisebread.com Stupid Tax Return Mistakes That Will Get You Audited http://www.wisebread.com/stupid-tax-return-mistakes-that-will-get-you-audited <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/stupid-tax-return-mistakes-that-will-get-you-audited" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/stress-465728625.jpg" alt="stressed man" title="stressed man" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>It's tax season, and that means it's time to start tearing your hair out. Maybe you're worried about owing the IRS. Maybe you're worried about an audit. Maybe you're trying to balance one fear against another. Don't. It can lead to stupid mistakes that will get you audited, creating a whole other set of problems &mdash; and mounting anxiety. Here are the small and silly mistakes that make up a big chunk of why people get audited. (See also: <a href="http://www.wisebread.com/top-10-red-flags-that-trigger-irs-audits?ref=seealso">10 Red Flags That Trigger Audits</a>)</p> <h2>Entering the Wrong SSN</h2> <p>This is perhaps the king of stupid mistakes on your tax return: putting down the wrong Social Security Number. If you put down the wrong SSN, your income isn't going to match what it should and the IRS is going to notice. Sound like too stupid of a mistake to make? It's not. In fact, it's one of the most common mistakes out there, along with the next one.</p> <h2>Not Checking Your Math</h2> <p>This is becoming a decreasing problem now that so few people prepare their taxes by themselves and by hand. Still, even if you're using a tax preparing program, you're entering information by hand, such as adding up every deduction in a single category together. Always double check your math, just like your teachers told you to do. Ignoring this step can lead to a simple stupid mistake and an audit that can cost you a ton of time and money, as well as create a lot of stress.</p> <p>Another way to avoid this stupid mistake is to hire a tax preparer, but be careful...</p> <h2>Using a Dubious Preparer</h2> <p>If you have someone offering you big returns, that can be a red flag. The reason being, you're only entitled to so much of a return, regardless of who prepares your taxes. A genius tax preparer is just someone who knows all of the deductions that you're entitled to and can help you claim all of them. On the other hand, a tax preparer with a flimsy regard for the law might fudge the numbers or shunt money off into tax deductions you're not actually entitled to. Doing that isn't smart business, it's playing Russian roulette with your finances. (See also: <a href="http://www.wisebread.com/5-things-tax-preparers-should-tell-you?ref=seealso">5 Things Tax Preparers Should Tell You</a>)</p> <h2>Bragging About Ill-Gotten Gains</h2> <p>Another big surprise: People often out themselves when it comes to cheating on their taxes. Even if you're not doing anything illegal, talking about your tax return to the wrong people can be a big mistake. In the first case, it's no one's business. More than that, however, the IRS gets thousands of reports from <a href="http://gswlaw.com/irsblog/2009/12/01/tax-informants-are-on-the-loose/">confidential informants</a> who are rewarded with a handsome bounty for the funds recovered. Keep mum about your tax return and don't give anyone anything to use against you.</p> <h2>Deducting &quot;Creative&quot; Donations</h2> <p>Donating is great, but it's not great to be creative and fudge how much you donated throughout the course of the year. (See also: <a href="http://www.wisebread.com/surprising-charitable-tax-deductions?ref=seealso">Surprising Charitable Tax Deductions</a>)</p> <p>This is a good place to put it in no uncertain terms: Be as truthful on your tax return as possible. If we were going to boil some of these down to a single stupid mistake it would be &quot;lying to get a slightly larger return.&quot;</p> <h2>Guessing</h2> <p>Don't guess, especially not when it comes to investments, dividends, interest, and other unearned income. If you do, you're likely to get it wrong. If you <em>don't</em> guess, the only thing that might trigger an audit is the bad math that we talked about earlier and that's another factor that's totally within your control. Remember that this type of income is taxed differently, so it's effectively like filling out a whole other tax form &mdash; and the IRS wants you to get it right. (See also: <a href="http://www.wisebread.com/tax-document-checklist-what-to-gather-before-doing-your-taxes?ref=seealso">Tax Document Checklist</a>)</p> <h2>Claiming Hobbies as a Business</h2> <p>One of the biggest ways that a self-employed person gets audited is by only pretending to be self-employed. Generally, to consider a hobby a business, it needs to make money. While the IRS will tolerate some losses while you're getting started, they're not going to let you claim to be a tennis instructor when you're losing thousands of dollars doing it every year. Be honest about what is a hobby and what is a business to avoid getting an audit letter this year.</p> <p><em>Any stupid tax mistakes I've missed? Please enter them in comments so that the rest of us can audit them!</em></p> <a href="http://www.wisebread.com/stupid-tax-return-mistakes-that-will-get-you-audited" class="sharethis-link" title="Stupid Tax Return Mistakes That Will Get You Audited" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/nicholas-pell">Nicholas Pell</a> of <a href="http://www.wisebread.com/stupid-tax-return-mistakes-that-will-get-you-audited">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-10-worst-tax-moves-you-can-make">The 10 Worst Tax Moves You Can Make</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-marriage-penalty-of-taxes-in-america-how-does-it-affect-you">The &quot;marriage penalty&quot; of taxes in America - how does it affect you?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-are-your-chances-of-getting-audited-by-the-irs-your-guess-is-probably-wrong">What are your chances of getting audited by the IRS? Your guess is probably wrong</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes tax audits tax mistakes taxes Tue, 11 Feb 2014 10:24:46 +0000 Nicholas Pell 1124324 at http://www.wisebread.com Best Money Tips: Legal Sources of Non-Taxable Income http://www.wisebread.com/best-money-tips-legal-sources-of-non-taxable-income <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-legal-sources-of-non-taxable-income" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/cash-2470806-small.jpg" alt="cash" title="cash" class="imagecache imagecache-250w" width="250" height="168" /></a> </div> </div> </div> <p>Welcome to Wise Bread&#39;s <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some awesome articles on legal sources of non-taxable income, the happiest jobs around, and how to score a deal without leaving a store&#39;s website.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.thewisdomjournal.com/Blog/sources-non-taxable-income/">15 Surprisingly Legal Sources of Non-Taxable Income</a> &mdash; Gifts up to $13,000 and contributions to a health savings account are legal sources of non-taxable income. [The Wisdom Journal]</p> <p><a href="http://www.savvysugar.com/Happy-Careers-33914649">15 of the Happiest Jobs Around</a> &mdash; Did you know realtors and marketing consultants have some of the happiest jobs around? [PopSugar Smart Living]</p> <p><a href="http://www.threethriftyguys.com/2014/02/5-ways-to-score-a-deal-without-leaving-a-stores-site/">5 Ways to Score a Deal Without Leaving a Store&#39;s Site</a> &mdash; Shopping a store&#39;s sale section can help you save without having to search the web for coupon codes. [Three Thrifty Guys]</p> <p><a href="http://www.getrichslowly.org/blog/2014/02/05/how-i-kept-saving-even-during-a-job-loss/">How I kept saving even during a job loss</a> &mdash; To save money even during a job loss, reevaluate your expenses. [Get Rich Slowly]</p> <p><a href="http://www.fivecentnickel.com/2014/02/03/lack-of-sleep-costing-you-a-fortune/">Lack of sleep costing you a fortune?</a> &mdash; When you are sleep deprived, you shop more hastily and pay for convenience. [Five Cent Nickel]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.howtofinancemoney.com/9-ways-financially-happier?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+howtofinancemoney+%28LCF+on+Personal+Finance%29">9 Ways to be Financially Happier</a> &mdash; Having a budget and being grateful for what you have can make you financially happier. [LCF on Personal Finance]</p> <p><a href="http://www.smartonmoney.com/4-financial-things-talk-marriage/">4 Financial Things to Talk About Before Marriage</a> &mdash; Before you get married, take the time to discuss paying your bills with your partner. [Smart On Money]</p> <p><a href="http://www.moolanomy.com/6452/top-tax-deductions-for-rental-property-owners-kmercadante/?utm_source=rss&amp;utm_medium=rss&amp;utm_campaign=top-tax-deductions-for-rental-property-owners-kmercadante">Top 10 Tax Deductions for Rental Property Owners</a> &mdash; Rental property owners can deduct insurance and depreciation costs from their taxes. [Moolanomy]</p> <p><a href="http://www.beingfrugal.net/basic-principles-for-growing-wealth/?utm_source=rss&amp;utm_medium=rss&amp;utm_campaign=basic-principles-for-growing-wealth">5 Basic Principles for Growing Wealth</a> &mdash; If you want to grow your wealth, take calculated risks. [BeingFrugal.net]</p> <p><a href="http://parentingsquad.com/9-ways-to-brush-up-your-child-s-art-education">9 Ways to Brush Up Your Child&#39;s Art Education</a> &mdash; To brush up your child&#39;s art education, plan a paint and pizza night. [Parenting Squad]</p> <a href="http://www.wisebread.com/best-money-tips-legal-sources-of-non-taxable-income" class="sharethis-link" title="Best Money Tips: Legal Sources of Non-Taxable Income" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-legal-sources-of-non-taxable-income">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/20-amazing-outrageous-and-just-plain-weird-tax-deductions">20 amazing, outrageous and just plain weird tax deductions</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-marriage-penalty-of-taxes-in-america-how-does-it-affect-you">The &quot;marriage penalty&quot; of taxes in America - how does it affect you?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-10-worst-tax-moves-you-can-make">The 10 Worst Tax Moves You Can Make</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-are-your-chances-of-getting-audited-by-the-irs-your-guess-is-probably-wrong">What are your chances of getting audited by the IRS? Your guess is probably wrong</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes best money tips Non-Taxable Income taxes Fri, 07 Feb 2014 11:00:11 +0000 Ashley Jacobs 1124285 at http://www.wisebread.com Best Money Tips: Tax Audit Flags http://www.wisebread.com/best-money-tips-tax-audit-flags <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-tax-audit-flags" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/stress-155010475.jpg" alt="stress" title="stress" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Welcome to Wise Bread&#39;s <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some fantastic articles on tax audit flags, tips for lowering your heating bill, and tips for easing back into work after vacation.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.thewisdomjournal.com/Blog/25-tax-audit-flags/">25 Tax Audit Flags</a> &mdash; Drastic income changes and off the charts itemized deductions can be tax audit red flags. [The Wisdom Journal]</p> <p><a href="http://firefinance.blogspot.com/2008/10/save-energy-lower-heating-bill.html?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+FireFinance-FinancialIndependenceRetireEarly+%28FIRE+Finance+-+Financial+Independence+Retire+Early%29">12 Tips to Lower Your Heating Bill</a> &mdash; To save money on your heating bill, clear your heating vents and winterize your windows. [FIRE Finance]</p> <p><a href="http://www.savvysugar.com/Things-Do-After-Vacation-23383346">6 Tips For Easing Back Into Work After Vacation</a> &mdash; When going back to work after vacation, make the transition easier by getting in earlier and making a to-do list. [PopSugar Smart Living]</p> <p><a href="http://christianpf.com/financial-options/">How to See Beyond the Obvious Financial Options</a> &mdash; If you want to see beyond the obvious financial options, practice creative thinking. [Christian PF]</p> <p><a href="http://canadianfinanceblog.com/starting-a-home-business/">Increase Your Income by Starting a Home Business</a> &mdash; Want to start your own home business? Make sure you understand the paperwork and tax implications. [Canadian Finance Blog]</p> <h2>Other Essential Reading</h2> <p><a href="http://bargainbabe.com/joint-vs-separate-bank-accounts-married-couples-right/">Joint or separate bank accounts for couples - which is better?</a> &mdash; When couples have joint bank accounts, it encourages financial discussions and removes the hassle of splitting costs. [Bargain Babe]</p> <p><a href="http://financialhighway.com/money-saving-tricks-anyone-can-use/">Money-Saving Tricks Anyone Can Use</a> &mdash; To save money on clothes, make sure to use an apron when cleaning. That way your clothes don&#39;t get trashed. [Financial Highway]</p> <p><a href="http://www.inkjetwilly.com/blog/super-bowl-printables/">Super Bowl Printables: 7 Free Sites</a> &mdash; If you are looking for Super Bowl printables, try Snap Creativity or Hostess With The Mostess. [InkJet Willy]</p> <p><a href="http://parentingsquad.com/6-kid-friendly-ways-to-celebrate-the-super-bowl-without-watching-the-big-game">6 Kid-Friendly Ways to Celebrate the Super Bowl (Without Watching the Big Game)</a> &mdash; Teaching your kids to play flag football is just one kid-friendly way to celebrate the Super Bowl. [Parenting Squad]</p> <p><a href="http://staplerconfessions.com/index.php/my-kind-of-diy-easy-car-repairs/">My Kind of DIY: Easy Car Repairs</a> &mdash; Installing windshield wipers is a car repair you can easily do on your own. [Stapler Confessions]</p> <a href="http://www.wisebread.com/best-money-tips-tax-audit-flags" class="sharethis-link" title="Best Money Tips: Tax Audit Flags" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-tax-audit-flags">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-are-your-chances-of-getting-audited-by-the-irs-your-guess-is-probably-wrong">What are your chances of getting audited by the IRS? Your guess is probably wrong</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/bushs-economic-stimulus-package-what-will-you-get-back">Bush&#039;s economic stimulus package; What will you get back?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/ring-ring-ka-ching-lying-about-your-telephone-tax">Ring. Ring. Ka-ching! Lying About Your Telephone Tax</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/101-tax-deductions-for-bloggers-and-freelancers">101 Tax deductions for bloggers and freelancers</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-great-places-to-get-free-tax-advice">6 Great Places to Get Free Tax Advice</a></span> </div> </li> </ul> </div> </div> </div> </div> Taxes audit best money tips flags red flags tax taxes Thu, 30 Jan 2014 11:00:11 +0000 Ashley Jacobs 1121283 at http://www.wisebread.com One Simple Trick to Get the Best Tax Benefit From Your Retirement Portfolio http://www.wisebread.com/one-simple-trick-to-get-the-best-tax-benefit-from-your-retirement-portfolio <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/one-simple-trick-to-get-the-best-tax-benefit-from-your-retirement-portfolio" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/balance-5121079-small.jpg" alt="balance" title="balance" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>The most basic strategy for long-term investing is asset allocation. But keeping to an allocation means rebalancing your portfolio, and rebalancing is fraught with complications &mdash; one big one being the tax implications of the sales you need to make. A simple trick can help you deal with that issue, but first let&#39;s take a closer look at asset allocation and rebalancing. (See also: <a href="http://www.wisebread.com/best-asset-allocation-for-your-portfolio">The Best Asset Allocation for Your Portfolio</a>)</p> <h2>What Is Asset Allocation?</h2> <p>The idea of asset allocation is to spread your investments among various categories (stocks, bonds, cash, gold, real estate, etc.), with the percentages in each category chosen to balance your desire for return and willingness to take risk.</p> <p>There are a lot of rules of thumb for asset allocation.</p> <h3>Spreading Your Wealth Around</h3> <p>One simple one is to set the stock fraction of your portfolio equal to 100 minus your age &mdash; so a 24-year-old would go with a portfolio of 76% stocks with the rest in bonds. Each year the portfolio gets a little more conservative, gradually shifting to only 35% stocks by age 65.</p> <p>An asset allocation championed by financial writer Harry Browne was a simple 25% each divided among stocks, bonds, gold, and cash.</p> <p>Many financial writers and advisors have model asset allocations. There is, of course, no way to know what asset allocation will turn out to be the best (until the future arrives, and it turns out that an asset allocation of 100% in whatever went up the most would have been best).</p> <p>My own sense is that any reasonably well-diversified portfolio will be okay: Just pick one. Sticking to an asset allocation means that you automatically avoid the error of putting all your money into whatever last year&#39;s hot investment was. (See also: <a href="http://www.wisebread.com/4-quick-ways-to-decide-if-a-company-is-worth-your-investment?ref=seealso">How to Know if a Company Is Worth Your Investment</a>)</p> <h2>What Is Rebalancing?</h2> <p>Because investment prices are constantly changing, your portfolio will almost immediately be out of balance. If stocks have gone up, the percentage of your portfolio invested in stocks will be above the target level. Rebalancing is the process of getting each category of your portfolio back to its target percentage. (See also: <a href="http://www.wisebread.com/keep-an-eye-on-your-money-with-these-7-online-investing-tools-and-apps?ref=seealso">7 Online Investing Tools and Apps</a>)</p> <p>In theory, rebalancing is easy:</p> <ol> <li>Calculate your total assets.<br /> &nbsp;</li> <li>Apply your target percentages to figure out how much money you should have in each category.<br /> &nbsp;</li> <li>In any category that&#39;s over its allocation, sell enough to bring the category down to the target.<br /> &nbsp;</li> <li>Use the money from those sales to buy the appropriate amount in each category that was under it&#39;s percentage.</li> </ol> <p>In practice, rebalancing is trickier than that, for several reasons.</p> <h2>Rebalancing Complications</h2> <p>The first issue with rebalancing is deciding how often to do it. You could do it every day &mdash; or even every second &mdash; selling a little of anything that had gone up a penny and buying whatever had gone down a penny, but that much churning would just add complexity and expense to no particular benefit. The general consensus is that annual rebalancing is about right, but you could make the case that doing it monthly or quarterly would be better.</p> <p>The second issue with rebalancing is procrastination. There&#39;s just natural inertia &mdash; it&#39;s one more thing to do, but one that doesn&#39;t have a real deadline, so it gets put off until later. (See also: <a href="http://www.wisebread.com/i-ll-finish-this-post-tomorrow-10-ways-to-stop-procrastinating?ref=seealso">10 Ways to Stop Procrastinating</a>)</p> <p>There&#39;s another factor, though, which is that after a year, your portfolio is probably pretty far off from its target percentages &mdash; but in what seems like a good way. You&#39;ll have more of your winners and less of your losers, and who doesn&#39;t want that? Selling your winners is always tough, and buying the laggards even tougher.</p> <p>Those are both real issues, but this post is about the third issue with rebalancing, which is taxes.</p> <h2>Tax-Efficiency in Rebalancing</h2> <p>Besides the issue of it just being tough to let your winners go, rebalancing also raises the issue of capital gains taxes. All those sales of winners incur tax liabilities. (Worse, since you&#39;re not selling the losers, you don&#39;t even have any losses to offset your gains.)</p> <h3>Rebalance Via Contributions Rather Than Sales</h3> <p>There&#39;s one basic trick to ameliorate this issue, which works pretty well: <em>Use your contributions to rebalance your portfolio.</em> Instead of dividing your contributions up the same as your target percentages, divide them up so as to move your portfolio closer toward balance.</p> <p>The calculations can get complicated if you let them &mdash; but you don&#39;t need to let them.</p> <p>If you make contributions frequently, and especially if a single contribution isn&#39;t big enough to bring your portfolio entirely back into balance, you can do it the easiest possible way: Figure out which category is the most dollars below its target, and put your whole contribution into that one category. Do the calculation afresh for the each contribution, and your portfolio will stay reasonably close to your desired asset allocation.</p> <p>The same thing can work when you leave the contribution phase of your life and move into the draw-down phase: Use your withdrawals to move your portfolio back into balance by selling from whatever category is the most dollars over its target.</p> <p>Rebalancing by targeting your contributions works very well, especially in the early phases of building your portfolio, when each month&#39;s contribution is large compared to the size of your total portfolio.</p> <p>After ten or twenty years, your portfolio (we very much hope) will be large compared to each month&#39;s contribution, and it will drift from your target asset allocation faster than targeting your contributions can bring it back in line. This is somewhat eased by the fact that you&#39;ll probably be able to make larger contributions as you progress along in your career, but eventually market volatility will almost certainly force you to going back to plan A: Sell things that have gone up and buy things that have gone down. But a careful application of rebalancing with your contributions will minimize the amount you have to sell &mdash; and thereby minimize the amount of capital gains taxes you incur. (<a href="http://www.wisebread.com/your-401-k-is-not-an-investment">Clever use of tax-advantaged accounts</a>, like IRAs and 401(k)s, will also help.)</p> <p><em>Do you look after your retirement funds via asset allocation? What tricks do you use to keep everything in balance?</em></p> <a href="http://www.wisebread.com/one-simple-trick-to-get-the-best-tax-benefit-from-your-retirement-portfolio" class="sharethis-link" title="One Simple Trick to Get the Best Tax Benefit From Your Retirement Portfolio" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/one-simple-trick-to-get-the-best-tax-benefit-from-your-retirement-portfolio">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-14"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-basics-of-asset-allocation">The Basics of Asset Allocation</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-highest-yielding-safe-investment-now-tax-exempt-money-market-funds">The Highest Yielding &quot;Safe&quot; Investment Now - Tax Exempt Money Market Funds</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/investment-gains-taxes-increase-the-worst-tax-policy-ever">Investment Gains Taxes Increase - The Worst Tax Policy Ever?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-to-fire-your-financial-adviser-soon">5 Reasons to Fire Your Financial Adviser Soon</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/did-your-parents-give-you-a-whole-life-insurance-policy-heres-what-to-do-with-it">Did Your Parents Give You a Whole Life Insurance Policy? Here&#039;s What to Do With It.</a></span> </div> </li> </ul> </div> </div> </div> </div> Investment Taxes asset allocation investment rebalancing retirement Wed, 08 Jan 2014 10:37:23 +0000 Philip Brewer 1107269 at http://www.wisebread.com Best Money Tips: Tips for End of Year Tax Planning http://www.wisebread.com/best-money-tips-tips-for-end-of-year-tax-planning <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-tips-for-end-of-year-tax-planning" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/finances-work-4818030-small.jpg" alt="finances" title="finances" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Welcome to Wise Bread&#39;s <a href="http://www.wisebread.com/topic/best-money-tips">Best Money Tips</a> Roundup! Today we found some fantastic articles on tips for end-of-year tax planning, ways to reduce risk in 2014, and the basic principles for growing wealth.</p> <h2>Top 5 Articles</h2> <p><a href="http://www.mydollarplan.com/17-tips-for-end-of-year-tax-planning/">17 Tips for End of Year Tax Planning</a> &mdash; Before the year is over, remember to finalize your records and do an AMT analysis. [My Dollar Plan]</p> <p><a href="http://www.threethriftyguys.com/2013/12/ways-to-reduce-risk-in-2014/">Ways to Reduce Risk in 2014</a> &mdash; To reduce risk in 2014, save up for major repairs or purchases. [Three Thrifty Guys]</p> <p><a href="http://www.beingfrugal.net/basic-principles-for-growing-wealth/?utm_source=rss&amp;utm_medium=rss&amp;utm_campaign=basic-principles-for-growing-wealth">5 Basic Principles for Growing Wealth</a> &mdash; If you want to grow your wealth, invest in yourself. [BeingFrugal.net]</p> <p><a href="http://www.thewisdomjournal.com/Blog/8-job-market-myths-and-truths/">8 Job Market Myths and Truths</a> &mdash; You shouldn&#39;t rely on an employment agency to help you find a job because 93% of the available positions out there are not listed with employment agencies. [The Wisdom Journal]</p> <p><a href="http://couplemoney.com/real-estate/deciding-on-when-is-the-best-time-to-sell-your-house/?utm_source=feedburner&amp;utm_medium=feed&amp;utm_campaign=Feed%3A+CoupleMoney+%28Couple+Money%29">Deciding on When is the Best Time to Sell Your House</a> &mdash; When considering when to sell your house, ask yourself why you want to sell your home. [Couple Money]</p> <h2>Other Essential Reading</h2> <p><a href="http://www.savvysugar.com/Free-Ways-Entertain-Yourself-Home-30926585">68 Mostly Free Ways to Entertain Yourself at Home</a> &mdash; Keep yourself entertained at home cheaply by listening to a TED Talk. [PopSugar Smart Living]</p> <p><a href="http://www.moolanomy.com/3097/how-big-should-an-emergency-fund-be/?utm_source=rss&amp;utm_medium=rss&amp;utm_campaign=how-big-should-an-emergency-fund-be">How Big Should an Emergency Fund Be?</a> &mdash; The typical rule of thumb is that you should have enough money saved up to last you 3-6 months. [Moolanomy]</p> <p><a href="http://moneyning.com/frugality/3-ways-an-auto-parts-store-can-save-you-money-on-car-repairs/">3 Ways an Auto Parts Store Can Save You Money on Car Repairs</a> &mdash; Did you know you can get a free battery check at an auto parts store? [MoneyNing]</p> <p><a href="http://www.fivecentnickel.com/2013/12/23/how-sustainable-are-your-financial-habits/">How sustainable are your financial habits?</a> &mdash; To determine how sustainable your financial habits are, consider whether or not you&#39;ve stabilized your housing costs. [Five Cent Nickel]</p> <p><a href="http://www.getrichslowly.org/blog/2013/12/19/understanding-the-ipo-process/">Understanding the IPO Process</a> &mdash; The purpose of an IPO is to create liquidity for early investors and employees. [Get Rich Slowly]</p> <a href="http://www.wisebread.com/best-money-tips-tips-for-end-of-year-tax-planning" class="sharethis-link" title="Best Money Tips: Tips for End of Year Tax Planning" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/ashley-jacobs">Ashley Jacobs</a> of <a href="http://www.wisebread.com/best-money-tips-tips-for-end-of-year-tax-planning">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. 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