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Entry bubble Picking a Tax Preparer

By: Jake | February 01, 2010 | Category: Money

Tax Preperation PictureTax season always reminds me of my uncle who used to earn a few extra bucks moonlighting at a tax preparation firm this time of year.  My dad, who does his own taxes, would sometimes ask him about tax changes---like the one that lets you claim donations for Haiti relief on your 2009 return.

If you get the heebie jeebies around calculators and aren't eligible for the free file federal tax option Jess talked about last week, you may want to think about hiring someone to prepare your taxes.

You are legally responsible for what is on your tax return so going with a tax preparer will be a buyer beware route. So much so that starting next year all tax preparers will be required to register with the Internal Revenue Service (IRS) and include an identification number on the tax returns they prepare.

The IRS offers free tax assistance to those over the age of 60 and military personnel and their families. If you don't qualify and decide to get someone else to prepare your taxes the IRS offers many tips for choosing a tax preparer.

Do you prepare your own taxes?


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Entry bubble Online Banking

By: Ginger | January 29, 2010 | Category: Money

Woman paying bills onlineRecently my friend mentioned that she and her husband were opening a bank account. I assumed she meant they had decided to switch banks. I asked her where had they banked before and why had they switched. She informed me that they weren't switching banks and that they haven't had a bank account for years. She told me this was their first bank account since they were a young married couple.

I've had a bank account since I started earning a paycheck, so this was a completely foreign concept to me, and being someone who occasionally blurts out the first thing that comes into my mind, I said, “Holy cannolis (OK, I didn't really say cannoli. I'm just keeping it clean for all of those kids out there who are interested in online banking)! You have got to be kidding! How have you managed to not have a bank account all of these years?”

She then went on to explain that when she and her husband were just starting out, they had an account with a bank and ordered checks. They never got the checks, because someone had stolen them. The person stole their identities and quickly made use of the checks. By the time they realized what had happened, a lot of damage had been done. Their money was gone and bad checks kept rolling in. She said it was a huge ordeal for them to try to straighten out the situation.

The experience left them so traumatized that they agreed to never again have a bank account. Since then, it was strictly cash transactions for them. They would pay a fee to cash their payday checks at stores. They would go get in lines (sometimes long lines) and pay bills directly. It was a lot of running around for them, but they felt safer doing it that way. It wasn't until they came into a substantial amount of money that caused them to open a bank account again.

She asked me about my experience with online banking. I told her that I love the convenience of paying bills online. I can schedule them to be paid on certain days. I can even set up automatic payments or transfer money to different accounts when I need to without having to go stand in line at my bank. I also mentioned that I like to be able to check all of my accounts online whenever I want, not just during banking hours.

She asked, “Aren't you worried someone will get access to your money?” I told her that I take precautions. I am careful to safeguard my personal information and financial transactions. I can actually keep a better eye on my assets online, because I can see daily activity on my accounts. Could bad stuff happen? Possibly, but bad stuff can happen regardless of whether you are doing your business online or not. Her story is an example of that.

I told her if she is worried about protecting her assets, there are resources that can help her to keep her money safe. I hope you find them useful, as well:

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Entry bubble Free Tax Filing

By: Jess | January 28, 2010 | Category: Money

taxesI got my W2 in the mail the other day, which meant only one thing: A quick phone call to my mom the accountant to ask her to help me with my taxes.

But mom, being the smart person that she is, decided I should probably try to do my taxes myself, so she told me about www.irs.gov/freefile, a website that helps people file their taxes for free if they meet certain income requirements.

There's a little quiz that asks you some questions such as age, estimated gross annual income, whether or not you're married, and then it suggests a list of possible free software tools that will help you fill out your federal taxes forms.

For someone like me, fairly new to the work world and a complete newbie at filing taxes, an option like this is really helpful.

For more information about filing your taxes, including information on the new rules that will let you claim Haiti donations on your 2009 returns, you can check the IRS website.

How do you prepare your taxes? Do you use a software program, an accountant, or file by hand?

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Entry bubble Disability Income Insurance

By: Ginger | January 22, 2010 | Category: Money

Woman in a hospital bedMost of us don't really like to think about events like disabling illness or injury. Let's face it, who wants to think about such bad things? However, we all owe it to ourselves and our families to take a little bit of time out of our busy lives to think about what we would do should a “what if” scenario occur. We all need to determine what resources we would have to keep paying our bills and maintaining our lifestyles.

Disability insurance can come in 3 forms:

  • Government-sponsored programs like workman's compensation or Social Security Disability Insurance;
  • Private employer-sponsored group disability plans that may cover short-term, long-term, or a combination of coverage; and
  • Private individual disability income policies that guarantee income when there isn't enough coverage from employer or government sponsored programs.

How many of us know exactly where we stand in terms of benefits should a disabling event occur? We can all look at our Social Security statements to see what monthly disability income we would get. For most of us, this amount would not cover all of our normal expenditures.

If you are employed, check with your employer to see if you have disability income coverage. If you do, find out:

  • What benefits would be available to you
  • How long after the start of a disability you would have to wait before benefits begin
  • How long payments would continue
  • If your employer’s plan takes other disability coverage (such as government programs) into account
  • If your long-term disability benefit is subject to a maximum amount you can receive

You can find most of the answers by asking for a booklet describing the disability coverage your company offers.

These resources that can help you determine how much coverage you have and whether you need additional coverage:

The other thing to keep in mind, it may take a while for disability insurance to begin. You should always have some money saved for emergencies.

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Entry bubble Home Buyer Tax Credit Extended

By: Jake | December 28, 2009 | Category: Money

Home Buyer PictureBack in October, Jess asked Gov Gab readers what they thought about Congress expanding the first-time home buyer tax credit. If you remember, the first-time home buyer tax credit gave up to $8,000 to a buyer who has not owned a primary residence during the three years up to the date of home purchase. The credit was due to end this month.

Congress passed the Worker, Homeownership, and Business Assistance Act of 2009 which extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. The Internal Revenue Service web page has posted details on the changes in the extension law and the big news is that if you already own a home, you may be eligible for a tax credit of up to $6,500.

The new law provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time home buyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.

The extension also permits a rise in income limits and other provisions. The IRS is the best resource to read about all the changes and what you will need to do to receive the credit.

What do you think of the Worker, Homeownership, and Business Assistance Act of 2009?

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