I have been getting a lot of questions lately about the new car sales tax deduction that people can claim for cars bought in 2009.   A lot of people are getting ready to do their taxes, and they’re wondering if they qualify for the tax deduction.

In the interest of answering some of the most common questions about the deduction, I thought I’d do an updated Q & A right here.

New Car Sales Tax Deduction Facts

Fast facts about the sales tax deduction, who is eligible, how to claim it and more:

• How much of the sales tax can I claim? State and local sales and excise taxes paid on up to $49,500 of the purchase price of each qualifying vehicle are deductible.
• What kind of vehicle purchases will qualify? Qualified motor vehicles generally include new cars, light trucks, motor homes and motorcycles.
• How big can the vehicle I purchase be? To qualify for the deduction, the new cars, light trucks and motorcycles must weigh 8,500 pounds or less. New motor homes are not subject to the weight limit.
• When do I have to purchase my vehicle? Purchases must occur after Feb. 16, 2009, and before Jan. 1, 2010.
• What if my state doesn’t have sales tax? Purchases made in states without a sales tax  (such as Alaska, Delaware, Hawaii, Montana, New Hampshire and Oregon) may also qualify for the deduction. Taxpayers in these states may be entitled to deduct other qualifying fees or taxes imposed by the state or local government. The fees or taxes that qualify must be assessed on the purchase of the vehicle and must be based on the vehicle’s sales price or as a per unit fee. Details here.
• Do I have to itemize to claim this deduction? This deduction can be taken regardless of whether the buyers itemize their deductions or choose the standard deduction. Taxpayers who do not itemize will add this additional amount to the standard deduction on their 2009 tax return.
• Is there an income limit to claim the credit? The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.
• If I don’t itemize, is there anything additional that I need to fill out? Taxpayers who do not itemize must complete Schedule L, Standard Deduction for Certain Filers to claim the deduction.
• Can I claim more than one deduction if I buy more than one car? Yes. There is no limit on the number of cars for which you can claim the deduction, provided each car is a qualified vehicle under the law.
• Can I take this deduction for any qualified vehicle — even those made by foreign car companies? Yes. As long as it is a new car and otherwise qualifies, you may take the deduction.
• Can I claim this deduction on a used car, or on a leased vehicle? No. Only qualifying new vehicle purchases are available to receive the deduction.

New Car Sales Tax Deduction Video

Do you have further questions about the tax deduction that we can answer here? Leave us a note in the comments!

This article was written by Peter Anderson. Peter Anderson is a Christian, husband to his beautiful wife Maria, and loves reading and writing about personal finance. You can find out more about him on the about page or check out his other sites at http://www.quicktofit.com and http://www.logosforwebsites.com. You can also follow him on Twitter at @moneymatters.

As a reminder, this is the second post of a two post series helping you answer the question:  Should you sell your house?

The first post looked at the financial considerations of selling your house.   I discussed costs in selling and buying, interest rates, whether or not selling will help you get out of debt sooner, how long you’ve been in the house and the current tax credit consideration.

Other Considerations For Selling Your House

This week I’m going to cover some of the non financial considerations in deciding to sell your house.  These considerations shouldn’t stand by themselves when making a decision to sell or not to sell.  Just because this is a new post, please weigh them as a whole and with the first post in making a decision that is right for you.

Do you have a good reason to sell?  Is selling a need or a want? Beyond financial questions, your real estate agent is probably going to ask you why you are selling.  In fact, anyone looking at your house will probably ask this question.  Many people have a need to sell such as a job change, or necessary relocation.  Others just want a new house.

The point is really evaluating the necessity of selling.  As you can tell from these posts there is a lot to consider and it can be a stressful time if not well planned.  So, before you put the sign in the front yard because the bathroom isn’t the right color, consider making a list of the reasons to move and ask yourself if it’s really worth the effort.

Consider the home or house thing; remove the emotions. Do you live in a home, or do you live in a house?  Most men would agree it’s a house.  But most women look at it well beyond the roof over our heads and see it as a home.  Women will typically look at new houses (or homes) in the same way.

While the differences can be funny (I hope no one is offended), the point is both men and women have to take the emotion out of selling.  Truthfully, you have to view it as selling a house because that is how the market looks at it.  The pictures, painting and drapes that can make it homey, don’t count when selling.

Are you willing to put forth the work? There is certainly something to think about here if you are trying to sell an older home.  Actually, even in selling a newer home you might expect to do some minor repairs to make it market ready.  Anytime you get ready to list you want to make sure your house is visually appealing.  Outside it’s always a good idea to have fresh mulch in the landscaping, flowers and a neat looking yard.  The inside of your house needs to be organized and in order.  If you can’t organize it others might think there isn’t enough space, etc.  If you’re serious about putting your house on the market, try to make it model home ready.  But keep in mind it’s going to require some work and time.

Are you prepared for neighbor chatter? Perhaps you’ve lived in your neighborhood for a while and have become friendly with the neighbors.  Unless announced in advance, you can imagine there will be some surprise and a lot of “why” questions when that sign is seen.  Yes, you’ll have your neighbors asking all sorts of questions initially.  While this consideration alone isn’t reason enough to sell or not sell, just be prepared for the forthcoming discussions.

Is there a lot of competition? I suppose this could be a financial consideration, but I’ll include it here anyway.  You and your real estate agent need to evaluate how you will handle the competition within your neighborhood, or even around the same area.

What sets your home apart from others?  Do you have some upgrades and are you priced better than others?  Do you have a bigger back yard?  Consider what is going to make your house sell in comparison to a similar house down the street.

What is the overall condition of your house? Conditions definitely matter in a lot of cases, especially if you’re in a market to sell to a family.  One of the things I mentioned in last week’s article was considering any cost associated to repairs or preparation of your house before listing it.

Think again if you’ve been putting off fixing that toilet that doesn’t flush properly, or perhaps patching the hole in the wall where little Johnny swung his baseball bat too hard.  The little things count when showing your house and you have to be willing to put forth some prep effort.

Consider the simple life. Consider if selling your house and buying another one will make your life more or less complex.  There is something about house shopping that is similar to car shopping.  Have you heard of new car fever?  You can easily develop the same thing with looking for a house.  Sometimes, you lose site of the fact that your current commute is only 15 minutes.  But a move to another house in your dream neighborhood will increase your commute considerably.  Is it worth the move?

Check your contentment monitor. Beyond the financials and everything else discussed, you need to dig deep and make sure you’re living a life of peace and contentment.  Don’t get caught up in chasing after the perfect house, or what the neighbor has because it’s a never ending race no one can win.

There are probably many other non financial considerations when deciding to sell your house.  Do you have any common examples you can share with readers?

This article was written by Jason Price. Jason Price is a personal finance writer at One Money Design and a Money Map Coach. His mission is helping people achieve true financial freedom. He provides practical tips for managing money wisely and shares Biblical financial principles. Beyond personal finance, Jason enjoys spending time with his family and playing soccer. You can also find him on Twitter and Facebook.

Bryce Bartruff, senior director and COO of American Missionary Fellowship, leads a personal finance workshop called “Fiscal Fitness.” For more information about attending or hosting a workshop in your area, give him a call at 610-527-4439, ext. 104 or email him through the contact form.

“Do you know how to make God laugh?” my nephew, RJ, asked as we walked to the parking lot.

“I must admit, I don’t know,” was my response.

“Just tell Him what you think you are going to do tomorrow,” he replied.

I just smiled. RJ was so right. We make all kinds of plans and think we know our immediate and long-term future — but only God knows what is really going to happen. In James 4: 13-15 the Bible says,

Now listen, you who say, ‘Today or tomorrow we will go to this or that city, spend a year there, carry on business and make money.’ Why, you do not even know what will happen tomorrow. What is your life? You are a mist that appears for a little while and then vanishes. Instead, you ought to say, ‘If it is the Lord’s will, we will live and do this or that.’” Yes, the future is a mystery.

This conversation led me to consider the ramifications of our uncertain future on the family budget. Sure, it is both a mature and responsible behavior to establish a family budget. Planning for the future is something we find the Apostle Paul doing, as well Daniel, King David, and King Saul. Getting a handle on anticipated events is what a family budget is all about. It is the process of identifying the amount of money we expect to be available during the month or year and then determining where we believe it should be spent. But much of the future is and always will be a mystery.

Doing A Monthly Budget Review

When establishing a budget, some expenses are anticipated, but many events and financial needs are unknown. We plan the best we can and hopefully are able to adjust the budget along the way. Unfortunately for some couples, once they agree on a budget, their commitment is immutable, and they refuse to make any adjustments to their numbers. They believe the amounts they have designated are solid and based upon a realistic understanding of their financial situation. They will not, therefore, adjust these numbers, regardless of the circumstances. If they allow flux, they believe it means they are violating the commitment they have made in good faith to their future.

It is true that a commitment to maintaining a budget gives the budget credibility and value, but refusing to adjust the budget along the way removes the ability to adapt to changes. Generally, a budget, when first established, is about 80% accurate. There are many small things we fail to consider because of unknown factors. Initially, the budget needs to be tested over several months and adjustments adapted as needed. Only then can a couple have confidence in its accuracy. Even then, minor adjustments may need to be made to reflect lifestyle changes and unforeseen circumstances. As the saying goes, “People make plans and then life happens.”

One of the tools I present when leading a Fiscal Fitness seminar is the Monthly Budget Review. This document helps users create an accurate budget by allowing them to list the amount they have in their current budget and comparing it to the amount spent during the current month. They can then decide if this difference is a change that is just a one-time event or if they should adjust the numbers in their budget to reflect ongoing needs.

Most people need to use the Monthly Budget Review form when they are in the process of creating their first budget. The first three months are critical to establishing an accurate account of where money is spent. Then, after a realistic account of where money should be spent is determined, they can reevaluate their budget using this form every six months. Expenses tend to migrate, morph, and mutate. The Monthly Budget Review helps identify trends and allows the user to evaluate the need to adjust spending so a budget that reflects a healthy lifestyle results.

Download the budget review here:

Monthly Budget Review (546.76 KB)

Have you ever done a monthly budget review?  If so, what did it help you to find?  Tell us your story in the comments.

This article was written by Guest Poster. We love guest contributors here at Bible Money Matters. Would you like to write for us as well? Please check out out our guest post submission guidelines and then contact us with your post idea!

This is a guest post from Mr Credit Card from askmrcreditcard.com. If you are looking for a credit card, check out his list of best credit cards recommendations.

A few weeks ago, my Pastor from church was preaching about “Thou shalt not covet” – one of the Ten Commandments. He said that it was not one of the most talked about commandments but was nevertheless very important and so easy to break. He gave the following analogy. He said that if he was caught reading a “Playboy” magazine in his office, it would be a scandal! But if he was seen reading “Kitchen and Bed” magazine, nobody would bother. But to him, reading the magazine about Kitchens and “coveting” for that dream kitchen that one’s neighbor has is just as bad. This got me thinking about how to prevent myself from coveting for “stuff”.

I think this is especially important because overspending and buying things we cannot afford is one of the main reasons we get into debt, both as individuals and as a nation. I’m also quite passionate about this subject because my kids are always asking me to buy stuff. Sometimes they expect to buy a stuff animal toy just because they visited the zoo, or they want a batting glove when they join spring baseball.

Off course, everyone, including myself have fallen for this, coveting for stuff. Here are some of my thoughts on this and how not to fall into this trap.

Buy only what you need – The first concept I thought was that we should only buy what we need. This sounds ridiculously simple but the concept is easily violated. Here’s a few examples. My kids have lots of soft toys (especially animal stuffed toys we get from the zoo).   By the way, we’ve stopped buying stuff when going to such places.  Last year, my son says he wanted a baseball batting glove (everyone on the team has one).  Well, he hardly had a hit the whole season, though his team won the championship.  My son also keeps wanting to buy “new soccer balls”.  (The kid with the fanciest soccer shoes was the worst player on the team by the way!)

In these examples, you can see that we buy things we simply do not need at the end of the day.  So, here’s rule #1: Buy only what you need. Not more, not less.

Buy only what is functional – There is never a need to buy the latest stuff. Even if you want to buy an iPhone, you don’t need the latest model if you are not going to use up all the memory! Most folks do not need the latest Intel Duo Core chip in their computers because they will never need such processing power, but they still buy them anyway. If you are into video editing, then perhaps you could justify spending on the Apple Mac Pro with tons of extra RAM!

Over the weekend, I was taking a friend from abroad to an Outlet mall. He went inside a Prada shop to check things out. I saw a very nice winter coat. It cost $770 on sale! It was  a very nice coat, but will it really keep me warm in freezing weather? I don’t know! It’s a Prada, not a North Face?  I also know several folks who do not play the piano well, but they bought a grand piano for their house anyway. Their kids take piano lessons, but they are certainly no maestros that warrant a Steinway! Perhaps an electronic piano or even a second hand piano would have served the purpose.

Earn the right to better stuff – My son recently asked me if he could get a “first base” glove if he played first base in this Spring’s baseball! My answer was a firm “NO”. Once again, I had to explain to him that wearing a “first base” glove was not going to make him a better player. In fact, I told him that he had to earn the right to get one. That means lots of practice and if he gets into his high school or college team, then he would probably have earned his right to get the right gear.

Same goes to the grand piano example. If an aspiring pianist has made it and is a professional, then he or she has earned the right to get a grand piano. In fact, you would even say that it is a necessity then. If a college student has excellent grades and has a gotten a job with a top law firm or something equivalent, then he or she has probably earned the right to a slightly “more expensive but stylish” working attire. A chef (who happens to cook at lot at home) probably has earned the right to good or even high end kitchen equipment because he will make use of them to the fullest. Ordinary folks like us who can hardly make a scramble egg properly should settle for the most affordable gear.

Do Not Go To The Mall Just For Sales and Discounts – Most of the time, it never pays to buy stuff just because they are on sale or on credit. Sales are always designed to stimulate impulse purchases. Furniture stores and car dealers are always offering 0% financing deals (sometimes as long as 24 months!). Here’s the thing – if you cannot pay in cash, you cannot afford it!  Very often, I find myself tempted to buy something I would never have bought because “it is on sale!”.

Make use of sales, but do not let “SALES MAKE USE OF YOU”.

Think about long run maintenance cost – Even if you could afford anything, thinking about long run maintenance cost is a good antidote if you are always coveting for the “best stuff”. Let’s use a mansion (or a huge house) as an example. Buying a new house is not cheap. Even if you could pay cash for a two million dollar home, it does not mean that is the end of the story. Your estate taxes will probably be about $1,500 a month (if you are lucky). Paying that every month is like paying a mortgage to me even if you have paid cash up front! Not to mention maintaining a garden, a pool etc. Getting the largest SUV is the same story. Unless, you “really” need it, the cost of gasoline could eat away at your finances. The same thing applies to expensive hobbies, or constantly buying tickets to sporting events. Buying expensive involves ongoing insurance cost to insure those valuable pieces!

Get rid of your credit card if it helps – It’s strange to hear this from me. But in my area of expertise, folks ask me if they should carry a credit card. My answer is that if it tempts you to spend more, then get rid of it. Use your bank check card instead. But if you have a business and you need one (like for example you have a business) then by all means get the best business credit card you can for your business. If you can use a credit card responsibly, a simple cash back credit card (like the one Peter uses) will save you money. But you know yourself on this one.

Slowly Change Your Concept of Happiness – Despite all these suggestions, I guess the only way to really stop coveting for stuff is to realize that material possessions do not make us happy. It can make life more comfortable, but they can’t make us any happier. To escape our consumerism culture requires a realization that spending time with your kids, having dinner with your spouse, talking to friends, watching a movie together will probably make you happier than all the “stuff” money can buy. We do not need the latest Wii game or Xbox. We don’t  need the latest cell phone because our parents got along with none at all! We just have to learn to live simply and enjoy the simple things in life.

What are your thoughts on the how not to covet?  What tips can you give? Tell us in the comments.

This article was written by Guest Poster. We love guest contributors here at Bible Money Matters. Would you like to write for us as well? Please check out out our guest post submission guidelines and then contact us with your post idea!

Isn’t the web an amazing thing?  This blog would certainly be a different thing without the net.  Because there is so much information online it is occasionally hard to know where to go for accurate financial information.

Peter just finished off a fantastic series on How To Make Money With A Blog.  Non-bloggers can also learn some important information from some of those posts because a little insider blogging information can actually help you find good financial resources online..

How to Find Trustworthy Financial Information Online

Lessons from SEO and Niche Websites

Since I’ve started blogging I’ve learned a little bit about SEO – Search Engine Optimization.  SEO is basically the best words and phrases to use to get people to visit your website through a search engine.  In the process of learning about SEO I also learned that it can be lucrative to set up something called ‘niche websites’.

What is a niche website?

A niche website is a website that was designed specifically to appeal to a very small target audience.  This blog, for example, is not a niche website.  It deals with all things financial.  If, however, this were a website that focused only on Christian Debt Consolidation and used those words in the name of my blog, then that would be a niche website.

Niche websites can get good traffic because they focus on a very specific keyword – Christian debt consolidation.  Since that name is in their blog title they have added search weight.  They then ‘manipulate’ the rankings by exchanging, requesting, or linking to that website.

Why offline wisdom doesn’t work online

If you were looking for a lawyer to help with your property tax issues you would want to find a lawyer who specializes in that topic.  If you were looking for a doctor to operate on your brain you would want to find a brain surgeon.

However, the niche websites are often set up because they are profitable.  Thus, the sole criteria for starting a niche website is – can I make money doing if? When you visit a niche website you are not getting an individual who specializes in a topic.  Instead, you are getting a person who learned the least amount of information possible on the topic, wrote 30-40 articles, and is now just waiting to milk this cash cow.  A person who does niche websites will have dozens or hundreds of websites.

Trust Financial Advice From Trusted Websites

Google (and other search engines) does try and help you find trusted material.  However, they determine trust (rank) based primarily on the number of back links.

Let’s say I like an article at One Money Design (another staff writer for Bible Money Matters) so I link to that article.  I’ve just helped One Money Design’s trust or rank.  Those who set up niche websites exchange links with other ‘illegitimate’ websites.  Joe is doing this niche website.  Steve is doing that niche website.  Joe and Steve exchange links – Joe links to Steve, Steve links to Joe, and both get an improved rank with Google.  But, neither Joe nor Steve necessarily produced anything valuable.  Joe can then contact another website and say, “If you link to me I’ll give you $10”.  This link improves the trust of Joe’s site.

When it comes to financial resources I would not trust information that comes from a ‘niche website’.  The site has only been designed with the intention that you would visit the site, click on an ad, and then go on your merry way.

How do you Find Trusted Financial Websites:

Of course on option is to visit professionally owned and branded websites – wall street journal, yahoo finance, msn money.  However, sometimes these larger sites lack the personal feel most readers value.

Visit the Wisebread Top 100 Personal Finance Blogs (interestingly, a list with about 400).  For sure all of the sites listed in the top half of this list are legitimate financial sites.  This does not mean these writers are not making money.  It does not mean they are right.  It simply means they have dealt with a large variety of personal finance topics and real people somewhere find their information helpful.

Who is the author or site sponsor?

If a blogger maintains a blog, he or she is typically quite open about saying this is me and I run this site.  Anonymity is a bad sign. For example, if you went to my about page you could learn some personal information as well as some information about the purpose of my blog.  If there is not an about page or site sponsor information, it is more likely just a site designed to get you to visit for advertisement purposes.

What is the website title?

Again, a specific ‘niche’ title is usually a bad sign.  If you search for bankruptcy you may see howtofilebankruptcy.com.  Want to guess what this website will tell you?  Instead, look for something like Should a Christian file bankruptcy on a site like Money Help For Christians.  You know this is a person who deals with other financial topics who will present his or her honest opinion on the topic.

How often is the site updated?

Niche websites typically get a group of articles posted and move on to other projects.  You know a website with updated information is still offering current and valuable information.

Look for comments

Comments are a sign that others are reading this information and at least on a ‘human’ level, people are interacting with the content.

Blogroll

Most blogs have a list of blogs they follow or read.  Some blog rolls are set up on an exchange basis.  The longer the blog roll, the more likely that is.  The blog roll suggests other blogs that may provide helpful information on the topic.

What do other sources say about the topic?

When you look under the comments section there may be something that says ‘trackbacks’. A trackback means someone else out in cyberspace linked to that article.  That is usually a good sign because another person online decided it is good enough to include it on his or her own site.

Time and Trust

It takes time to build a trustworthy site.  Older sites should inherently get more trust.  Under the archive section you can know how long someone has been blogging.  While this does not mean you should ignore younger blogs, it does mean that, just like a friendship, trust takes time to build.

Do you have your own tips for finding trusted financial information online?  Tell us your thoughts in the comments!

This article was written by Craig Ford. Craig is a fulltime missionary in Papua New Guinea who writes Money Help For Christians and Help Me Travel Cheap, a frugal family travel blog. He is the author of Money Wisdom From Proverbs, has a Masters of Divinity degree, and (most importantly) eats homemade pizza with his family every Friday night.

With the turn of the new year many people are considering selling their house and looking for a new one.  They ask, “Should I sell my home, or is it the right time to sell?”

Traditionally speaking, early in the year has been a good time to put your house on the market.  After the holidays buyers are typically out on the market looking for houses.  But even if it’s not the beginning of the new year, spring will soon be upon us and the market will pick up with potential buyers looking for the right house, at the right location and the right price.  So, if you’re considering selling your house, is it the right decision?

Truthfully, there really isn’t a right answer, or one size fits all answer to meet all situations.  It will vary across different situations and you have to do a little bit of thinking and planning to determine what makes sense for you.

Should You Sell Your House?  New 2 Post Series

Today I’m starting a two post series here at Bible Money Matters titled:  Should You Sell Your House?  This week I’ll cover financial considerations of selling your home and in next week’s post I’ll go beyond the numbers and discuss other factors that may play into your decision.  Both weeks will provide a list of things to get your mind thinking and help you determine the best decision for you.

Making It About The Money

Will you profit on the sale of your existing home? A good real estate agent is likely to ask you how much you need to sell your current house for and what is the highest price you can pay for a new house?

It’s important to run some numbers to find out.  Consider these costs (hint: look at a previous settlement statement to get estimates):

• Real estate sales commissions
• Fees paid at closing:  In looking at my last settlement statement we paid some
• Title charges
• Government recording and transfer charges
• Any additional settlement charges
• Pay off for existing mortgage
• Home repairs if this is included in the sales contract.  Or, perhaps you need to make repairs before putting your house on the market.
• Pre-sale preparations such as landscaping, painting, etc.

You’ll need to know how much your house is worth and what you plan to list it for on the market.  Your real estate agent can help by pulling comps to show you what other houses are selling for in your area.  You can also use websites such as zillow.com to get ideas.

If you have good cost estimates and a realistic sales price, you should be able to determine if you can expect to walk away from the deal with any profit, or get the cash back that went into purchasing your house.

There is always a buyer, but the price has to be right. Remember that you can’t just list your house for whatever your heart desires.  Basic economics applies to the housing market.  There is a price point for every area in which people will buy unless it’s a special circumstance.  You just have to find that price point and consider whether or not it is going to leave you with a profit or loss in consideration of the costs.

How much will it cost to get into the new house? Once you know how much you’re expected to make on the sale of your house, consider the costs to get into a new house:

• Costs associated with the new loan
• Title charges
• Government recording and transfer charges
• Prepaid expenses such as insurance and taxes or reserves deposited with the lender
• Moving costs
• New house purchases (such as window coverings (if not a new house).

Do you still have any cash left after these costs for a down payment?  If so (or not), you should be able to determine how much house you can afford.  If you use Dave Ramsey’s mortgage rule in which the mortgage payment, taxes and insurance cannot exceed 25% of your monthly take home pay, you’ll be able to determine the purchase price required to make those numbers work.

What interest rate can you get for your new loan? Determine current interest rates for home loans.  Bankrate.com can be a good source to use here.  I would also recommend contacting some lenders to find out in advance how much you can qualify for, but don’t consider that amount your purchase price.  Know what you can afford and use the estimates to make sure you can get a loan with a good interest rate.  At the time of this post, interest rates are still low, so this is definitely some added incentive.

Will making the move put you into a position of paying off your home sooner? I think this is a question not often considered.  Are you planning to one day pay off your house?  If not, you should because a mortgage is still considered debt.

I realize there is a whole other discussion about whether or not you should pay off your house because of the tax deductions, but for now, think of it as a step towards a life without debt.  Factors to consider here include the total interest you’ll pay over the life of the loan and the amount of years to pay off your loan.  Try to get this number down.

How long have you been in your house? It’s often said you need to be in your house 5 years to recover the costs associated with the original purchase.  What do you think? Perhaps there is less to consider here if you can sell your house for enough to get all of your money back and more.  But if your house price isn’t as high as you had hoped for and you’ll lose money, it may be wise to wait until the housing prices rise, until you can cover original costs and make some money for a down payment.

Home buyers tax credit incentive. Finally, consider the home buyer tax credit available right now for first-time home buyers ($8000) and repeat buyers ($6500).  It’s certainly a consideration in buying since a home buyer tax credit is a reduction in the amount of taxes owed!

There are probably many other money related considerations when deciding to sell your house.  Do you have any examples you can share?  Tell us in the comments!

This article was written by Jason Price. Jason Price is a personal finance writer at One Money Design and a Money Map Coach. His mission is helping people achieve true financial freedom. He provides practical tips for managing money wisely and shares Biblical financial principles. Beyond personal finance, Jason enjoys spending time with his family and playing soccer. You can also find him on Twitter and Facebook.

Tax time is here.   By now you should have received your W2 forms, 1099 interest income forms and other miscellaneous income reporting forms.   Now that you’ve got your stack of tax information ready to go, it’s time to start filing your taxes! But before you do,wait! I’ve got some news to share with you!

We’re Giving Away 2 Free Copies Of TurboTax Deluxe Online

This year I’m fortunate to be partnering with TurboTax, one of the premier tax filing software available. Intuit TurboTax is allowing me to give two lucky winners a free copy of Intuit’s TurboTax Deluxe Online tax filing software. The gift card that they’ve sent me (see above) will allow the winners to receive free federal and state tax filing using the online version of TurboTax Deluxe – which is a step up from their free version.

Some of the benefits of the TurboTax software we’ll be giving away:

• Guiding taxpayers step-by-step: Built in guidance for more than 350 possible deductions and credits, including the 2009 economic stimulus.  Helps taxpayers get the biggest refund possible.
• Real time error checking: flags errors and missed information as you go.  Fix mistakes right then, or later on.
• Double Checking for commonly overlooked deductions and credits: You won’t miss important credits that many people fail to claim every year.
• Audit support with every return: The TurboTax Audit Risk Meter helps customers avoid common errors and reduce their risk of an audit before they file.  A downloadable Audit Support Center assists customers in the unlikely event they are audited.
• Instantly transferring investment and wage information: TurboTax customers can easily, accurately and securely import 1099 investment and W-2 wage information from more than 140 financial institutions and payroll providers directly into their tax return.

Try TurboTax Out For Free

This year since I’ll be getting my own free copy of TurboTax Premier so I’m going to give it a try.  I’ve used other tax software in the past, Tax Cut, TaxSlayer and others -  but I’m ready to give TurboTax a try.

From talking with others, most  of them seem to really like TurboTax – so I’m looking forward to taking it around the block for a test drive.  We’ll see how it stacks up to the rest.

You too can give TurboTax a try for free to see how it works for you.    That’s one of the cool features of the software is that you can basically do your entire return, and find out what your results are. You don’t even have to pay until you get to the point of actually filing and sending in your return.  If you’re not happy with it, don’t go through with filing – it won’t cost you a thing.

Win Your Copy Of TurboTax Deluxe

To win your copy of TurboTax Deluxe Online, just leave a comment below and:

• Tell us if you’ve used TurboTax before.
• Tell us if you expect to get a refund this year.

Or if you prefer, you can tweet the following on Twitter, and leave us a comment linking to your status:

• Tweet “Win a copy of @turbotax Deluxe online. Win one of 2 free copies here: http://tinyurl.com/turbotaxforfree (via @moneymatters)”.

Be sure to use a name and email that we can contact you at when commenting as it will be used to notify you if you win.  2 lucky winners will be chosen at random using Random.org on Friday at 12pm central.

NOTE: No need to wait to start your return to see if you’ve won.  Start your TurboTax Deluxe tax return today by clicking on the button below.  When I announce the winner on Friday the winner can simply enter the gift code on the final screen titled “review your TurboTax fees”.  There will be a button that says “Enter Pre-Paid Code”.  Remember, the contest is for TurboTax Deluxe, so you would need to start your return on that version. Otherwise, if you prefer to use the free version – you can do that too, and switch later on if you win.

Update: We have our 2 winners! Our winners of the free tax filing using TurboTax Deluxe are:  Comment #12 Chatak and comment #55 Josh. I will be in touch with your promo codes guys!

Be sure to check out these other TurboTax giveaways as well!

• Mapgirl
• Clever Dude
• My Next Buck
• Budgets are Sexy

This article was written by Peter Anderson. Peter Anderson is a Christian, husband to his beautiful wife Maria, and loves reading and writing about personal finance. You can find out more about him on the about page or check out his other sites at http://www.quicktofit.com and http://www.logosforwebsites.com. You can also follow him on Twitter at @moneymatters.

Over the past few months my employers have been scrambling to try and manage the company’s health care costs in light of pending increases in premiums both for the company, and for employees. With all the uncertainty with pending health care legislation, increased taxes and other concerns the company has put off making any huge decisions on health care this year, and we’re choosing to continue our coverage, but with a large increase in premiums. Next year the company may be moving to a Health Savings Account (HSA) system to help manage costs. This will mean higher deductibles, which for some people will mean paying more out of pocket. We’ll see how it works out.

One thing we decided to do this year, that we probably should have done in past years, was to sign up for my company’s health care flexible spending account or FSA. this should allow us to save a bit of money on our taxes this coming year.  FSAs aren’t for everyone, for reasons that we’ll go into below.

What Is A Flexible Spending Account Or FSA?

FSAs are not offered by all employers, and if you’re self employed you aren’t able to participate.  Normally how it works is your company will have an open enrollment period for the FSA when you can sign up for the company’s plan.   At that time you have to elect an amount that you want your employer to deduct from your paycheck that will be contributed to the FSA.  That amount is taken out of your pay before taxes, and can then be spent on eligible health care costs.  Using pre-tax money to pay for medical and health care spending allows you to lower your taxable income.  So basically FSAs are a good way to lower your taxes, especially if you’re anticipating a lot of medical costs in a year as we are.

Normally you can’t change your amount you’ve elected to deduct from your pay during the year unless certain life events have happened and there has been a change in your employment or family status.

Contributions To Your FSA

When signing up for your FSA account you have to designate how much you want to contribute for that year.  You’ll want to estimate how much money you think you’ll be paying out of pocket for the coming year’s health care expenses, and you then sign up for the year’s FSA account using that amount.   Your employer will then set it up so that the amount is deducted from your paycheck before taxes, and it will effectively lower your taxable income.

While the government hasn’t set a limit on the amount you or your employer can contribute to the accounts, each FSA plan will usually have a maximum dollar amount or maximum percentage that you can contribute to the account.

Our plan has a maximum of $5000 that you can contribute, and at this time we’re contributing $3000.  We are expecting our first child this year, and we expect to have substantial medical bills because of that, so using a FSA this year is a good choice for us.  With the life change event in July when the baby is born we can elect to increase our contributions if needed.  If we expect to use all $5000 of the maximum allowed, we can add the extra contributions to our plan at that time.

FSA Contributions Must Be Used Or Be Lost

In most cases FSA funds that are not used during the year are subject to forfeit, so it’s important when you’re estimating your health care costs, to be as close as possible to the actual costs.  If you’re way off you may find yourself trying to figure out as many eligible health care expenses at the end of the year as you can so you don’t have to forfeit your remaining money.  Any forfeited funds are returned to the company and are used to cover other plan users that may have left their job during the year.

FSA Funds Can Be Used At Any Time – The FSA Loophole

One thing that is nice about contributing to a FSA is the fact that you can use your elected funds at any time. For example, if my family had $3000 worth of health care expenses in the next month, we would be able to submit those expenses to be reimbursed even this early in the year.  Even though we’ve only made one small payment on our FSA account (nowhere near the $3000 we’re planning to contribute), we can still spend all $3000 up front.    This also has been referred to as the FSA loophole because if you end up leaving a job only part of the way into the year, you no longer have to make contributions to your FSA, even though you’ve used all of your money for the year.  The negative balance in your account is balanced out by funds not used by other plan members who have forfeited their funds at the end of the year.

How You Get Reimbursed For Health Care Expenses

When you sign up for a FSA you will often have to pay for all of your health care expenses out of pocket, and then submit a claim for reimbursement.   There are a few ways that you can get reimbursed:

• Check in the mail:  Often you will have to submit a form with attached documentation to prove your health care expenses.  Reimbursement will often take a couple of weeks at which time you’ll receive a check in the mail.
• Direct Deposit:  Same as above, except you elect to receive the funds via a direct depost it so it is a bit quicker.
• FSA debit card: Some plans now offer a debit card for your FSA plan. You just use the card on eligible expenses and the amount is deducted from  your account.

At my work we have only have the first two options available, so we’ll be electing to have the funds direct deposited into our checking account.

Conclusion

If you know that your family is going to have substantial medical costs during they year, using an employer sponsored FSA plan can be a great idea.  You can end up saving hundreds of dollars on your taxes.   Our family knows in advance this year that we’ll be having thousands of dollars in bills due to the birth of our first child, and for us using the FSA is a great deal. Yes it’s a pain keeping track of all the costs, but the hundreds of dollars in savings we’ll enjoy are worth it.

Does your family have an FSA plan? Were you able to elect the correct amount in past years, 0r did you find yourself scrambling to find eligible expenses at the end of the year? Tell us your FSA experience, or ask us questions in the comments!

This article was written by Peter Anderson. Peter Anderson is a Christian, husband to his beautiful wife Maria, and loves reading and writing about personal finance. You can find out more about him on the about page or check out his other sites at http://www.quicktofit.com and http://www.logosforwebsites.com. You can also follow him on Twitter at @moneymatters.

This is a guest post by Carol Topp, CPA.  Carol is the mother of two teenage daughters and she lives in Cincinnati, Ohio.  She discusses teenagers and taxes at http://TeensandTaxes.com.

Bonnie had been adding her son’s interest income to her tax return for many years.  That was a $1,000 mistake. She was overpaying Uncle Sam and never realized it.

It is easy to understand why Bonnie reported her son’s interest income as her own.  The statements from her son’s UTMA (Uniform Gift to Minors Act) account at the local bank had both her name and his name on the account.   Her name was even listed first as “Bonnie Smith, Custodian for Luke Smith”.

Tax Breaks For Children

By simply adding Luke’s interest to her own, Bonnie was missing out on some tax breaks allowed to children. The first $950 (in 2009) of investment income belonging to a child is not taxed at all. Investment income is interest, dividends and capital gain distributions from a mutual fund.  The next $950 of investment income is taxed at the child’s rate, which is usually lower than the parent’s rate. Any investment income over $1,900 is taxed at the parent’s rate and dubbed the kiddie tax.   The kiddie tax is explained at my website TeensandTaxes.com.

Avoid Bonnie’s mistake of adding your teenager’s investment income to your own on your tax return. A teenagers’ investment income can be included on a parent’s tax return, but you must use a special form,  Form 8814 Parents’ Election to Report Child’s Interest and Dividends.

The IRS warns that using Form 8814 could result in higher income tax. For my tax clients, I always file a separate return for the teenager or child.  I avoid using Form 8814.

Teen W-2  Income Must Be Reported Separately

If your teenager has earned income from a job, he must file his own tax return. You cannot add your child’s earned income, reported on his W-2, to your wages.

I fixed Bonnie’s mistakes by filing amended tax returns for the previous three years. She received $1,026 in refunds, while her son Luke owed $114 for a difference of $912.

Even after paying my fees, it was worthwhile to fix her mistakes.  It could be worthwhile in your situation as well. Please consult a tax professional for advice on your specific situation.

Have you made any of these mistakes when filing a child’s taxes? Tell us about it in the comments!

This article was written by Guest Poster. We love guest contributors here at Bible Money Matters. Would you like to write for us as well? Please check out out our guest post submission guidelines and then contact us with your post idea!

Over the next few months we will be taking a long and laborious journey through the perilous tax season.

But, some of you are giddy with excitement.  You think you are finally going to get something of value from the government – an income tax refund.  All year you’ve been waiting for this moment.  Now you can finally afford to take a vacation or buy a new car.

Can I interrupt your dreaming for a dose of reality and a little reminder?

The money the government sends you is the money you already sent them.

Far too many people view a tax refund like manna from heaven.  However, this is not God’s sovereign way of providing for you.  It means that throughout the previous tax year you had too much money withheld from your salary.

Three Reasons Why A Big Tax Return Is Bad

1. A big tax return simply means you did not properly calculate and estimate your taxes.
2. A big tax return means that you let the government hold your money for up to 16 months.  By the way, the government did not give you any interest on that money.
3. We think psychologically different about found money than earned money.

Found Money Vs. Earned Money

Earned money is money you get on a regular basis that is closely associated with the work required to get the money.  After working for two weeks you get a check from your company and say to yourself – you bet I deserve this, I busted my back to get this money.

When you sit down to budget earned money, you say to yourself – hey, I worked hard for this money I’m not going to waste it like water.

Found money is money you get on a one time basis (or very rarely) that feels like a gift.  This unexpected income must always be budgeted or you are likely to spend it without control.  You work all year and pay money to the government and you “forgot” you were sending them money every month.  When you get a check (tax refund) in the mail, you say to yourself – party time, I forgot I had this money.  What’s the best way to blow this money?

The only problem is that this found money is really earned money.

You will spend your money a lot more responsibly if it is not withheld from your pay check.

What Is The Financial Cost Of A Big Refund?

How about the financial cost of a big tax return?

Let’s say you had an extra $4,000 withheld from the previous year.  Simultaneously, you’ve been paying down debt.  You have a $4,000 credit card debt that charges interest at 12%.  This means that you paid around $500 just so the the government could keep your money and send it back at the new year.

This, my friends, is not a financial plan.  It is a financial disaster.  If you’re getting a big income tax return, I encourage you to adjust your income tax withholding.  Keep your earned money.

How To Adjust Your Income Tax Withholding

• If you are self employed just make your estimated quarterly payments based on what you should have paid last year (this assumes your financial and family conditions will remain the same).
• If you are employed you will need to visit your HR representative and get a new W-4.  The W-4 tells the company how much to withhold from your pay.  Make the necessary adjustments to dependents in order to get the withholding to match tax liability from the previous year.  The goal is not getting the number of dependents right, but getting the withholding right.  More details here.

Do any of you like the idea of getting a big tax refund?  Do you use the income tax refund as a forced saving plan?  Have you considered changing your withholding to make sure that you don’t get a big refund?  Tell us your situation in the comments!

This article was written by Craig Ford. Craig is a fulltime missionary in Papua New Guinea who writes Money Help For Christians and Help Me Travel Cheap, a frugal family travel blog. He is the author of Money Wisdom From Proverbs, has a Masters of Divinity degree, and (most importantly) eats homemade pizza with his family every Friday night.