Doug Beecher's Tax & Money Blog

Ways the New PATH Tax Law Helps You

noreply@blogger.com (Anonymous) — Mon, 28 Dec 2015 22:49:00 +0000

Once again in 2015, Congress waited until just a few days before year end to pass a law to extend the life of many popular and helpful deductions in the tax code. The difference this time is they made many of these items permanent, and in some cases also improved them.

Here are the key ways this will help you:

The Child Tax Credit now has no expiration date. Up to $1,000 per child under age 17 for taxpayers with adjusted gross income of $75,000 (single head of household), $110,000 (married filing jointly), $55,000 (married filing separately). In many cases this is even a refundable credit, meaning it can be paid to you even when you have zero tax liability.

This credit is in addition to the deduction you can claim for dependents (and which is not limited to children under age 17).

Earned Income Credit is no longer scheduled to decrease after 2017. It will continue to be available for taxpayers with investment income less than $3,301 and adjusted gross income less than $53,267 (married filing jointly) or $47,747 (single head of household) and three or more children. It is also available for taxpayers with less than three children (even no children) at lower income levels.

Like most tax provisions, there are additional rules and procedures. You can find many of them at www.irs.gov/eitc.

Educator Expenses Deduction now has no expiration date and has been improved. Educators who work 900+ hours yearly as teachers, instructors, counselors, or principal and aides in grade levels kindergarten though 12 in schools recognized by your state (generally not home schools) can deduct up to $250 per educator in unreimbursed expenses for books, supplies, computer equipment software, and other items used in the classroom.

In my experience, most educators have much more than $250 in unreimbursed expenses. These additional expenses (and also their union dues) can be deducted to the extent they exceed 2% of adjusted gross income and if the educator itemizes deductions. Because of these limitations, it is very nice that at least part of these expenses can be deducted no matter what.

The improvements: After 2015 this deduction will be indexed for inflation and professional development expenses will be added to the list of expenses that qualify for the deduction.

The itemized deduction for state/local sales taxes no longer has an expiration date. This helps both taxpayers in states that don't have a state income tax and taxpayers who paid sales tax on a nonbusiness purchase of an auto, truck, boat, airplane, home, or substantial improvements on a home. Taxpayers making these purchases can add that sales tax to the amount in a table for sales taxes on general purchases -- and then choose whether to claim the resulting total sales tax or the state income tax, whichever is higher.

IRA transfers directly to a charity are now tax free without an expiration date. This only helps taxpayers of at least age 70 1/2, but once that age is reached, it is helpful at almost all income levels. This is because it lowers adjusted gross income and does not require the taxpayer to itemize deductions. In many cases, it also reduces the amount of social security is taxable ... so it is totally worth the effort to call your IRA administrator to have them directly make a charitable contribution you were going to do anyway, rather than you receiving the IRA distribution and then making the donation.

Section 179 Equipment Expense Deduction is now available up to $500,000 without an expiration date. Normally when equipment is purchased and put in to service in a business, a gradual deduction for the cost of the equipment is taken over several years. For many years there has been a provision to allow business owners to elect to take this deduction in full in the year the equipment is put in service. The maximum amount of this election was reduced to $25,000 on January 1, 2015, but the new PATH law increased the maximum to $500,000. Not only is there no longer an expiration date, but the maximum will now be indexed for inflation yearly.

Post-Secondary Education Tuition and Fees Deduction was extended for 2015 and 2016. It is available only for tuition and fees, but in some cases it can be more beneficial than claiming an education credit because it can reduce state as well as federal income tax. It can be worth calculating both ways to see which is more beneficial to you.

The provision for no tax on forgiveness of acquisition debt on a principal residence has been extended for 2015 and 2016. This is true for up to $2 million of such debt. Without this provision, many people would owe thousands of dollars of tax on home mortgage debt they couldn't afford to pay, and became taxable income when it was forgiven.

The itemized deduction for premiums paid on mortgage insurance contracts issued after 2006 in connection with home acquisition debt is extended for 2015 and 2016. This deduction begins to be phased out at adjusted gross income of $100,000 for all taxpayers except married filing separately; for them the phase out begins at $50,000 adjusted gross income.

There are many other deductions that were extended by the PATH law that will provide benefits to smaller groups of people. You can read about them here.

My Spouse Is In Jail. How Do I File Taxes?

noreply@blogger.com (Anonymous) — Wed, 19 Aug 2015 14:20:00 +0000

Recently I had the following dialogue, which perhaps may be helpful to others:

Dear Doug, I have a tax question. I'm getting a divorce. My spouse is in jail. How do I go about filing taxes when it is time?

Answer: You can for sure submit a tax return using the status "married filing separately". If you did not live with your spouse even one day during the last six months of the year, you may do better filing using the status "head of household", if you meet the other requirements for that status. Either way you don't have to involve your spouse, who will be on their own to meet tax filing requirements on any income they had for the year.

Follow-up question: How does it work with my spouse being in jail?

Answer: You file a separate return without them.

As with anything else, these decisions are highly personalized. Be sure to get qualified help to make sure you make the best legal choice for you.

Becoming Profitable By Feeling Your Customers' Pain

noreply@blogger.com (Anonymous) — Tue, 10 Feb 2015 06:44:00 +0000

The key to a steady, profitable revenue stream is to provide better solutions to your customers' pain points, better solutions to their strongest needs, than your competitors do. You do this by ...

Top 10 Ways The Tax Extenders Law Will Help You - If You Act Very Fast!

noreply@blogger.com (Anonymous) — Thu, 25 Dec 2014 20:13:00 +0000

Over 50 benefits in the tax law expired at the end of 2013. As you've probably heard Congress passed a last minute bill to extend most of them to the end of 2014. The President signed this December 19, so this is now official.

I will leave to others the discussion of how much this hurt all of us that it took until this late hour to get this done. And, yes, this means we are going through this all over again next year.

Let's get to what you really care about - a Top 10 list of what will save you tax right now this year in this law: (And get on this right away, you only have until December 31 to take action on these)

10. Extension of above-the-line deduction for qualified tuition and related expenses. Most people get more benefit from the American Opportunity or the Lifetime Learning tax credits, but this deduction gives another opportunity that in some cases is more advantageous because in many states it saves on state in addition to federal income taxes.

9. Extension of work opportunity tax credit. This continues to give help to employers who work with their state workforce services office to give hard to employ workers a chance.

8. Extension of tax-free distributions from individual retirement plans for
charitable purposes. This allows people over age 70 1/2 who are required to take a distribution from their IRA or other retirement accounts to choose to donate all or part of that distribution to the qualified charity of their choice.

7. Extension of credit for nonbusiness energy property. You can receive a credit of 10% of the cost of qualified energy improvements, with a maximum credit of $500.

6. Extension of deduction of State and local general sales taxes. If you live in one of the eight states without a state income tax, this is a huge benefit. In other states, if you make a large purchase such as for a vehicle or home improvements, this can benefit you if the total sales tax you pay in the year is higher than the state income tax you pay.

5. Extension of exclusion from gross income of discharge of qualified principal
residence indebtedness. One of the nastier surprises taxpayers get when filing their returns is receiving a 1099 form showing the amount of debt forgiveness as taxable income. This extends just a little longer the relief available when that debt forgiveness was related to your qualified principal residence.

4. Extension of mortgage insurance premiums treated as qualified residence
interest. For most people with adjusted gross income below $110,000 per year, this lets you claim an itemized deduction for the mortgage insurance premiums you pay.

3. Extension of bonus depreciation. This allows businesses to claim a deduction of 50% of the amount of equipment put into service in 2014 along with depreciation on the remaining 50% over its normal taxable life (generally 5-7 years)

2. Extension of deduction for certain expenses of elementary and secondary
school teachers. This is high on my list because it benefits many of my clients, yet it costs the government the least amount of any of these on this list.

1. Extension of increased expensing limitations and treatment of certain real property as section 179 property. This allows small businesses who put less than $2 million of qualified property in service during 2014 to take a deduction for up to $500,000 of it in full in 2014. The special rules that allow expensing for computer software, qualified leasehold improvement property, qualified restaurant property, and qualified retail improvement property are also extended through 2014.

Here's a bonus item that is not used much, but those who do deserve big kudos! Extension of employer wage credit for employees who are active duty members of the uniformed services. This is a 20% credit given to small employers who keep employees on the payroll when they are called to active duty.

I look forward to working with you on these concepts and more.

Become Profitable Through Business Organization!

noreply@blogger.com (Anonymous) — Fri, 05 Dec 2014 00:50:00 +0000

Question 6 of the 12 Most Asked Questions When Starting a Business is:

How can the business effectively delegate responsibilities so each and every need of the business is assigned to a particular position and there is an orderly accountability to each?

In less than 90 seconds, this video gives 7 points that answer this question.

I look forward to working with you on these concepts and more.

QuickBooks Classes in Hurricane Begin Dec 8

noreply@blogger.com (Anonymous) — Wed, 03 Dec 2014 21:03:00 +0000

Announcing QuickBooks training classes in Hurricane, Utah!

Each class lasts 45-60 minutes, with opportunities to ask personalized questions throughout the presentation.
Class size is limited to 8 to ensure individual attention.
Tuition is $25 per class, pick the topics most beneficial to you!
Location: Accutek Solutions, 51 North 1000 West, Suite 5
Reserve your seat now by emailing Alisa Davis: alisa@accuteksolutions.co

Here's the schedule (all of these classes begin at 10 am):

Monday, December 8. Lesson 1: Getting Started - A Quick Overview of the Accounting You Need To Know To Use QuickBooks

Monday, December 15. Lesson 2: Setting Up Your New QuickBooks File - What Decisions Must Be Made Before Using QuickBooks

Wednesday, December 17. Lesson 3: Working With Lists - Chart of Accounts, Customers/Jobs, Vendors, Custom Fields

Monday, January 5. Lesson 4: Working With Bank Accounts - Using Registers - How to Reconcile Bank Accounts in QuickBooks

Wednesday, January 7. Lesson 5: Using Other Accounts in QuickBooks - Including Credit Cards, Types of Asset, Liability, and Equity Accounts

Monday, January 12. Lesson 6: Entering Sales Information - Invoices - Memorizing Invoices for Recurring Use - Item List - Price Level List - Create Invoice Letters

Wednesday, January 14. Lesson 7: Receiving Payments & Making Deposits - Includes Customer Discounts, Partial or Down Payments, How to Handle Customer Bounced Checks

Monday, January 19. Lesson 8: Entering and Paying Bills - Using QuickBooks For Accounts Payable

Wednesday, January 21. Lesson 9: Analyzing Financial Data - Using QuickReports, Preset Reports, and Graphs

Monday, January 26. Lesson 15: Customizing Forms and Writing QuickBooks Letters

Please note that Accutek presents QuickBooks training on an on-demand basis. The following lessons can also be scheduled at other times if desired:

Lesson 10: Setting Up Inventory
Lesson 11: Tracking and Paying Sales Tax
Lesson 13: Estimating and Progress Invoicing
Lesson 14: Tracking Time
Lesson 16: Working With Multiple Currencies

We do not offer Lesson 12, which is Doing Payroll With QuickBooks. Accutek recommends outsourcing your payroll processing and tax reporting to a professional service. We would be happy to offer you a quote for your payroll needs.

12 Most Asked Questions When Starting A Business (Final 4)

noreply@blogger.com (Anonymous) — Thu, 28 Aug 2014 23:28:00 +0000

This is the third of a three-video series that discuss the 12 most asked questions when starting a business.

I look forward to working with you on these questions and more.

12 Most Asked Questions When Starting A Business (Middle 4)

noreply@blogger.com (Anonymous) — Wed, 27 Aug 2014 23:34:00 +0000

This is the second of a three-video series that discuss the 12 most asked questions when starting a business.

I look forward to working with you on these questions and more.

Become Profitable Through Entity Choice - LLC, S or C Corp

noreply@blogger.com (Anonymous) — Wed, 27 Aug 2014 00:42:00 +0000

How is a sole proprietorship, general or limited partnership, LLC, S or C corporation different – which of these entity types is best for this business and its members?

I look forward to working with you on these questions and more.

12 Most Asked Questions When Starting A Business (First 4)

noreply@blogger.com (Anonymous) — Tue, 26 Aug 2014 23:34:00 +0000

This is the first of a three-video series that discuss the 12 most asked questions when starting a business.

I look forward to working with you on these questions and more.

How Long Do I Have To Keep My Tax Documents ... Really?

noreply@blogger.com (Anonymous) — Wed, 23 Apr 2014 01:11:00 +0000

Recent question from a client: I have tax returns back to 1988, I am having items shred, can I shred some of these?

My answer: Under "normal" circumstances, you can be audited for 3 years from the date you filed a return or the April 15 deadline, whichever is later for a given year. Just to be safe, I advise keeping all records used to justify income and deductions on a return for one year beyond that, or 4 years. All records include such things as all the W-2s, 1099s, bank and credit card statements, invoices, receipts, calendars, mileage records, etc. Scanned copies of all these is a good option, as long as you keep a backup in a separate physical location. I particularly recommend scanning any receipts or other documents printed on thermal paper, because these rapidly fade to an unreadable, useless state.

"Normal" circumstances implies that
the IRS and any applicable state tax departments agree you filed the returns, didn't omit income or grossly overstate expenses (meaning by more than 20%), and claimed the correct basis for any capital assets sold. If they decide they are going to contest one of those things, there is no statute of limitations to help you out. I'm sure this is why so many people are so nervous about discarding their tax papers ever. Just as an example, I had a client once who was contacted by the IRS 18 years after a specific tax year, with a claim that the return was never filed. Thankfully, I was able to talk the IRS out of pursuing that one on the grounds that if they believed the filing hadn't been made, they should have come forward many years earlier and that my client had long since discarded the return copies in question, relying on the general 3 year rule.

That experience did increase my general level of concern, because I'm not certain I would have the same result for another client in a similar circumstance. The following is the compromise I personally feel comfortable with, in the end this is a judgement call you will have to think about too:

Keep copies of all tax returns, along with certified mail receipts or other proof of filing, and cancelled check copies for any tax paid with the return. Forever. Thankfully, this should all fit in one bankers box.

Discard all the supporting documents for those returns after 4 years.

Except, any documents supporting basis in a capital asset (real estate, vehicles, and equipment) need to be kept as long as you have that asset. If you ultimately dispose of the asset in an exchange, then the basis transfers to the replacement asset and you continue to need to keep the documents until the replacement asset is disposed of.

Sadly, all of this is probably clear as mud, but I did try. If this generates questions, please ask, and I will make every effort to clarify this.

Photo credit: This was a picture I took today of some of my own files, with the names blotted out for privacy protection. The picture, this blog post, and all of my blog posts, are copyright by me, 2014, all rights reserved. Thank you.

Utah Tax Commission Issues Tax Filing Guidance For Same-Sex Couples For 2013

noreply@blogger.com (Anonymous) — Sat, 01 Feb 2014 02:49:00 +0000

On January 15, 2014, the Utah State Tax Commission issued a tax notice, "Individual Income Tax Returns For Same-Sex Couples For Tax Year 2013", which includes this statement:

"Same-sex couples who are eligible to file a joint federal income tax return and who elect

to file jointly, may also file a joint 2013 Utah Individual Income Tax return as provided in Utah

Code § 59-10-503. Eligible married couples may file a joint return if they are married as of the

close of the tax year."

As recently as December 6, 2013, Dolores J. Furniss, a Manager with the Commission, noted in her yearly presentation at the Utah State University Income Tax School that same-sex couples who were eligible to and do file joint federal income tax returns for 2013 would have to file as single taxpayers in Utah. While the January 15 notice is thus an important change for affected taxpayers to consider when filing their 2013 tax returns, this is not a permanent change at this point. The notice goes on to say:

"This notice is limited to the 2013 tax year. Filing information for future years will be

provided as court rulings and other information become available. If any taxpayers are required

to file amended 2013 tax returns based on future court rulings, they will not be subject to

penalties for any tax deficiencies resulting solely from following this guidance."

Tax laws and regulations change daily, so whether this change impacts you or not, something else will. Staying informed is more important than ever.

Are You The Right Person To Work With Me?

noreply@blogger.com (Anonymous) — Mon, 27 Jan 2014 04:07:00 +0000

Accutek is the professional services company I founded. It is building a team of experienced associates of varied backgrounds that work together with each other and with each individual client to develop unique financial and tax solutions for each client’s personal and business needs. We are based in Hurricane, Utah, and serve wonderful clients locally and wherever Internet and overnight delivery services can reach.

I think there's a good chance that you, my reader, might just be a great fit for our team. Please click below to continue reading and learn more about this opportunity!

General Terms of These Employment Opportunities With Accutek

Accutek has low employee turnover. Of its five associates, the most recent hire was eight years ago. One of these associates was hospitalized for an illness in November 2013, and has not been physically able to return to work yet. We are looking for temporary part-time employees to fill this vacancy on an interim basis. These positions could become permanent and full-time in the future.

Each position is paid by the hour, with weekly paychecks distributed on Mondays for the pay period that ended the preceding Thursday. Overtime for these positions is not likely, but if needed for a seasonal peak demand, is paid at time and a half on hours worked exceeding 40 in the weekly pay period.

Accutek is an equal opportunity employer.

To apply for Accutek employment, please e-mail us a letter of introduction, resume, and supporting documentation you would like us to consider to doug@accuteksolutions.co. (Please note that there is no “m” at the end of this e-mail address)

Accutek offers two forms of employee benefits, as follows:

Paid Time Off. Each weekly pay period, paid time off is calculated for each employee as follows: For employees with up to 5 years of Accutek service, 8.33% of time worked is added to his or her running balance of paid time off hours. (For an employee averaging 40 hours per week, this is the equivalent of 4 weeks off with pay yearly). This percentage increases for employees with 5 or more years of Accutek service. Accutek makes no distinction in types of paid time off, so when an employee takes a paid day off for a holiday, sick leave, personal time off, or any other reason, it is deducted from the running balance of paid time off hours in the same pay period for which the employee was paid for time off.

Employee Health Insurance. Full-time employees, specifically those who have worked 1,560 hours, including paid time off, in the 12 month period ending on the last day of January, are eligible for Accutek’s medical insurance plan for the plan year that begins April 1. Employees in their first year of Accutek employment, hired to work an average of 30 hours per week or more throughout their first year, are also eligible to participate in this plan beginning on the first day of the month after they reach 60 days of Accutek service. (For example, if an employee begins work on January 20, they become eligible for the health insurance plan beginning April 1.)

Some employees will achieve full-time status year-round by working heavy hours in peak season while not being scheduled at all during parts of off season.

Accutek’s employee medical plan is Select Med Plus, offered by Select Health, and is available for themselves, their spouse, and dependent children up to age 26. Employees electing to participate in this plan pay 10% of the premium cost by payroll deduction, and Accutek pays the other 90%.

This percentage split is reviewed once a year to make sure it remains within the requirements of IRS Notice 2012-58 that the employee portion of health insurance be “affordable”, which the notice defines as no more than 9.5% of gross pay. Current details of the plan will be provided each employee yearly at the open enrollment period, which begins in February and takes effect April 1.

Descriptions of Each Employment Opportunity:

Each of these employment opportunities is on an on-call, as-needed basis. Each qualified applicant must demonstrate excellent oral and written communications skills that address the unique needs of each client. A description of each position, along with its hourly pay and minimum education, credential/licensing and experience requirements follows below. An applicant may apply for any one of the positions, or any combination of them, as his or her interests, experience, credentials, licensing, and education make appropriate. If an applicant is hired for multiple positions, he or she will be paid the applicable hourly rate for the hours worked each weekly pay period in each position.

Tax Resolution Specialist. This employee meets with clients and prospective clients who have received collection, audit, or other notices of an issue with a federal or state tax agency that they have come to Accutek for assistance in resolving. The initial meeting is free to the client, and is for the purpose of determining if we can be of help to the client, and if the client determines we can be of help to them. If the decision is made to proceed with the matter, a letter is prepared specifying the terms of the engagement, is signed by both Accutek and the client, and an initial retainer is paid by the client. The tax resolution specialist then performs tasks such as preparing appropriate power of attorney forms so that he or she can represent the client before the applicable tax agency, analyzing the documentation provided by the client, along with other information that can be gathered such as agency transcripts, identifies the resolution objective, and communicates with the client and the tax agency regularly until it is agreed that the best resolution possible has been achieved. The tax resolutions specialist needs to be a currently licensed certified public accountant or attorney, or be an enrolled agent whose rights to practice before the IRS are current, and who is skilled in speaking with the IRS and resolving tax issues. The position pays an hourly rate between $20.10 and $33.70, depending on the amount of demonstrated experience in representing clients before the IRS and state tax agencies.

Planning Consultant. Answers a diverse range of client and staff accounting and tax questions. Works on various client planning projects. Examples of these planning projects include working with clients to develop their business plans, helping clients evaluate the benefits and drawbacks on a financial, operations, and tax basis of various entity types (such as LLC, S corporation, C corporation, non-profit organization, etc.) they may be considering for a new enterprise they are establishing, preparing documentation for SBA loan applications and other financing requests, working as Chief Financial Officer (CFO) on a consulting basis for clients, helping clients with trust and estate financial and tax planning considerations, helping clients with employee benefit plan (such as flexible benefit plans, health savings account plans, 401(k) plans, etc.) financial and tax planning considerations, and more. The planning consultant may also be scheduled to be “on call” to answer walk-in, telephone, and e-mail questions from clients and prospective clients. The planning consultant needs to be a currently licensed certified public accountant or attorney, or hold the certified management accountant (CMA) designation, preferably also with a master’s degree in business administration, and with documented experience in one or more of the planning opportunity examples stated above. This position pays an hourly rate between $28.50 and $33.70, depending on experience.

QuickBooks Training and Quality Control Accountant. QuickBooks is the most widely-used accounting software for small and medium sized businesses. The accountant in this position works on an one-on-one basis with individual clients who maintain their own QuickBooks files and then submits them to Accutek in order to prepare tax returns, analysis for management purposes (for instance by the planning consultant described above), etc. The accountant will analyze the client’s QuickBooks data file, suggest corrections that may be needed, help with bank and credit card account reconciliations, help with data transfer from client point-of-sale software to their QuickBooks data file, etc. The accountant will also be available to provide individualized QuickBooks training to clients, help set up new QuickBooks data files, and answer questions that may arise in maintaining the files. This accountant needs to be a currently certified QuickBooks Pro Advisor, preferably with a bachelor’s degree in accounting and demonstrated accounting transaction experience. This position pays an hourly rate between $20.10 and $28.50, depending on experience.

We look forward to receiving your letter of introduction, resume, and supporting documentation you would like us to consider by e-mail at: doug@accuteksolutions.co. (Please note that there is no “m” at the end of this e-mail address) Each of these positions is available to the successful applicant to start work now.

IRS Will Begin Accepting 2013 Personal Income Tax Returns on January 31

noreply@blogger.com (Anonymous) — Mon, 06 Jan 2014 17:49:00 +0000

The IRS has announced the following dates they will begin processing 2013 income tax returns:

1040 Series Individual Tax Returns: January 31, 2014 (please click here for more info)

Entity Tax Returns: January 13, 2014 (please click here for more info)

My suggestion is that you use the time until these dates to organize all your documents and get them to your tax professional so that you are ready to electronically file when the IRS processing date arrives. You will still get the fastest and best response from the IRS by electronically filing; any paper returns filed will be held until the initial batches of electronically filed returns are processed.

$2000 Energy Efficient Home Construction Credit Expiring Dec 31 2013

noreply@blogger.com (Anonymous) — Thu, 21 Nov 2013 02:15:00 +0000

Builders of a dwelling unit certified to have annual heating and cooling consumption at least 50% below that of a "comparable dwelling unit" and meets related requirements as stated in IRS Notice 2008-35 have been eligible for a $2000 income tax credit since August 2005. There is also a $1000 income tax credit available if the certified annual heating and cooling consumption is at least 30% below a "comparable dwelling unit". Builders can claim this credit by completing IRS Form 8908 and attaching it to income your tax return. (In some cases you can do the simpler IRS Form 3800. Refer to Form 8908 instructions to determine if this applies to you.)

Homes that are substantially reconstructed and rehabilitated to these energy efficiency standards are also eligible for the credit.

If you are eligible for this credit, you will want to act quickly. This home energy efficiency credit was scheduled to expire in 2010 and was extended three more years to the current expiration date of December 31, 2013.

The home builder for this purpose is the person who owns and has basis in the qualified energy efficient home during its construction. If the owner hires a third party contractor to construct the home, and has basis in the home during construction, the person that hires the third party contractor is the one who is eligible to claim this credit. This provision is carefully worded. If you need help clarifying it, please be sure to get it!

The rules for certifying the reduced heating and cooling consumption are also spelled out in IRS Notice 2008-35, and include a requirement that it be done by an "eligible certifier", who is not related to the home builder and who had been accredited by the Residential Energy Services Network (RESNET) (or the equivalent rating network)

This credit for construction of new energy efficient homes is number 14 on a list of 55 expiring federal tax provisions. (For the full list of these, prepared by the Congressional Joint Committee on Taxation staff, click here.)

Photo credit: http://www.publicdomainpictures.net/hledej.php?hleda=energy+efficient+home&x=-791&y=-45

Watch Out: Principal Residence Debt Relief Tax Exclusion Expires 12-31-2013

noreply@blogger.com (Anonymous) — Tue, 19 Nov 2013 18:30:00 +0000

"Generally, if you owe a debt to someone else and they cancel or forgive that debt for less than its full amount, you are treated for income tax purposes as having income and may have to pay tax on this income." This is how the IRS begins its discussion in Publication 4681 of your potential tax liability when you go through a debt cancellation, foreclosure, repossession, or abandonment.

When the debt is on your principal residence, there has been an important exception to this general rule ... an exception that is scheduled to expire December 31, 2013. It is number 21 on a list of 55 expiring federal tax provisions. (For the full list of these, prepared by the Congressional Joint Committee on Taxation staff, click here.)

If you owe substantially more money on your principal residence than it is worth, and you don't have the desire and the ability to continue making the required monthly payments, you may want to seriously consider getting out of the house now before 2013 ends and you possibly add a big tax bill to your pain.

Please give this some thought, and possibly take action after getting appropriate help.

Payday Loan Addiction ... The Challenges And Possible Solutions

noreply@blogger.com (Anonymous) — Fri, 15 Nov 2013 03:08:00 +0000

This will be primarily an audio blog post this time. You never know what is going to come back around for you in life. I went to elementary and junior high school with some great people, and the friendships continue all these years later. One of them was Steve Fischmann, who went on to UCLA business school, a management career at Levi Strauss, and four years as a New Mexico State Senator. He now works on a variety of projects including a weekly radio program out of Las Cruces that discusses local issues that seem to pop up pretty much everywhere.

One of the interests Steve and I share is trying to help people free themselves from the trap of payday, car title, and tax refund anticipation loans, as well as other predatory lending practices. I'm as excited as anyone to see businesses succeed, in fact I've made a career out of helping people turn their business dreams into reality. But ... as with any right, one's right to operate a business is limited by one's responsibility to not hurt the rights and opportunities of others. These loans can be as addictive as any substance, as I have learned from hard experience over my 35 year career, as well as from life in general.

Steve did an hour segment of his radio show on this topic today. His guest for the full day was

Alan Webber, a candidate for New Mexico governor. He was going to have a second guest as well, but that one didn't show. So my phone call to the show to give an experience grew to being asked to stay for the full show.

If you don't want to listen to the whole thing, here are some highlighted times you can go forward to as you like to these approximate time points:

10:20 I'm introduced. For 4 minutes we have fun talking about our life long ago and how several of us were into business even as children.

14:30 We move to the main topic, for the first of three discussions that run 7-9 minutes each.

23:20 Commercial break, which runs to 28:00 at which point we have fun for 2 minutes before returning to the topic.

30:00 Second discussion begins.

39:30 Commercial break, which runs to 44:20, followed by about 2 more minutes of recap before

46:25 beginning the final segment, which runs seven minutes to the end of the show at 53:30.

This is my first time on radio, and listening to myself, I don't know that I have a "radio voice". Thanks for putting up with that part of it. But it was fun, and hopefully will lead to some solutions. Might take a long time, often does, and that's OK. Tortoise steps forward beat no steps forward every time!

Radio talk show credit: Thanks to Steve Fischmann, Alan Webber,

http://www.ksnm570.am and feeds.ksnm570.am

Photo credit: http://www.stockfreeimages.com/p1/payday-loan.html

And for the final word, here's a sixth grade picture with a few of the people Steve talks about on his show. Steve is on the back row, fourth from the right. His twin brother Scott is on the left end of the second row. Brad Bobbs is third from the left on the back row, and I'm standing just to the left of Brad. If you want to know who the rest of the people are, Peggy Sonoda, who is basically front and center in the plaid skirt, posted this to her Facebook page in 2010 and everyone is identified there.

Cheerio!

The IRS is Reopening ... Slowly

noreply@blogger.com (Anonymous) — Sat, 19 Oct 2013 19:32:00 +0000

Practical Note ... If you filed for a tax refund or a copy of a tax document (for example, to apply for a student loan, a mortgage, etc.) these requests are pretty much going to be handled in the order they were received beginning with those that came in October 1.

My expectation is that for at least the next month, perhaps through the holidays, these requests are likely to take 3-4 weeks longer than they ordinarily would. Just sayin' ...

Please click here to read the official IRS statement on this:

Photo credit: http://commons.wikimedia.org/wiki/File:IRS_building_on_constitution_avenue_in_DC.jpg This work is in the public domain in the United States because it is a work prepared by an officer or employee of the United States Government as part of that person’s official duties under the terms of Title 17, Chapter 1, Section 105 of the US Code.

#Business #Travel #TaxDeduction #2013Update

noreply@blogger.com (Anonymous) — Mon, 14 Oct 2013 19:43:00 +0000

Photo credit: http://www.publicdomainpictures.net/view-image.php?image=31119&picture=city-traveling

The Internal Revenue Service kept its per diem rates essentially unchanged in its Notice 2013-65 yearly update released shortly before the federal government partial shutdown. Most small business taxpayers find the meals and incidential portion of these rules most useful, and they are unchanged at $65 per day for high cost locations and $52 per day everywhere else. The transportation industry nationwide rate is also unchanged at $59 per day.

This blog went into a simplified discussion of these rules in April 2012, that description is still applicable and can be read here. Sally P. Schreiber, J.D., goes into it in even more detail in a September 25, 2013 article in the Journal of Accountancy that can be read here.

If you would like the list of the high cost locations just published by the IRS, please click to continue reading.

Key city (followed by) County or other defined location

Arizona
Sedona City limits of Sedona
(March 1-April 30)

California
Monterey Monterey
(July 1-August 31)
Napa Napa
(October 1-November 30 and April 1-September 30)
San Diego San Diego
San Francisco San Francisco
Santa Barbara Santa Barbara
Santa Cruz Santa Cruz
(June 1-August 31)
Santa Monica City limits of Santa Monica
Yosemite National Park Mariposa
(June 1-August 31)

Colorado

Aspen Pitkin

(December 1-March 31 and June 1-August 31)

Denver/Aurora Denver, Adams, Arapahoe, and

Jefferson

Steamboat Springs Routt

(December 1-March 31)

Telluride San Miguel

(December 1-March 31 and June 1-September 30)

Vail Eagle

(December 1-August 31)

District of Columbia

Washington D.C. (also the cities of Alexandria, Falls Church, and Fairfax, and the

counties of Arlington and Fairfax, in Virginia; and the counties of Montgomery and

Prince George's in Maryland) (See also Maryland and Virginia)

Florida

Boca Raton/Delray Beach/Jupiter Palm Beach/Hendry

(January 1-April 30)

Fort Lauderdale Broward

(January 1-May 31)

Fort Walton Beach/De Funiak Springs Okaloosa and Walton

(June 1-July 31)

Key West Monroe

Miami Miami-Dade

(January 1-March 31)

Naples Collier

(January 1-April 30)

Illinois

Chicago Cook and Lake

(October 1-November 30 and March 1-September 30)

Louisiana

New Orleans Orleans, St. Bernard, Jefferson

and Plaquemine Parishes

(October 1-June 30)

Maine

Bar Harbor Hancock

(July 1-August 31)

Maryland

Baltimore City Baltimore City

(October 1-November 30 and March 1-September 30)

Cambridge/St. Michaels Dorchester and Talbot

(June 1-August 31)

Ocean City Worcester

(June 1-August 31)

Washington, DC Metro Area Montgomery and Prince George’s

Massachusetts

Boston/Cambridge Suffolk, City of Cambridge

Falmouth City limits of Falmouth

(July 1-August 31)

Martha's Vineyard Dukes

(July 1-August 31)

Nantucket Nantucket

(June 1-September 30)

New Hampshire

Conway Carroll

(July 1-August 31)

New York

Floral Park/Garden City/Great Neck Nassau

Glens Falls Warren

(July 1-August 31)

Lake Placid Essex

(July 1-August 31)

Manhattan (includes the boroughs of Bronx, Kings, New York, Queens,

Manhattan, Brooklyn, the Bronx, Queens Richmond

and Staten Island)

Saratoga Springs/Schenectady Saratoga and Schenectady

(July 1-August 31)

Tarrytown/White Plains/New Rochelle Westchester

North Carolina

Kill Devil Dare

(June 1-August 31)

Pennsylvania

Philadelphia Philadelphia

Rhode Island

Jamestown/Middletown/Newport Newport

(October 1-October 31 and May 1-September 30)

South Carolina

Charleston Charleston, Berkeley and

(March 1-May 31) Dorchester

Texas

Midland Midland

Utah

Park City Summit

(December 1-March 31)

Virginia

Washington, DC Metro Area Cities of Alexandria, Fairfax, and

Falls Church; counties of

Arlington and Fairfax

Virginia Beach City of Virginia Beach

(June 1-August 31)

Washington

Seattle King

Wyoming Teton and Sublette

Jackson/Pinedale

(July 1-August 31)

#WorthARead: #ClaytonMChristensen How Will You Measure Your Life?

noreply@blogger.com (Anonymous) — Sun, 13 Oct 2013 02:03:00 +0000

And Then It Became This Book:
http://www.amazon.com/How-Will-Measure-Your-Life/dp/0062102419

My son Benjamin had a meeting at work discussing goals the other day ... they gave him this Harvard Business Review article to read.

These excerpts, with highlighting by me, explain why it's worth your time to read it:

"If I had been suckered into telling Andy Grove what he should think about the microprocessor business, I’d have been killed. But instead of telling him what to think, I taught him how to think—and then he reached what I felt was the correct decision on his own."

"I ask my students to ... find cogent answers to three questions: First, how can I be sure

that I’ll be happy in my career? Second, how can be sure that my relationships with my spouse and my family become an enduring source of happiness? Third, how can I be sure I’ll stay out of jail? Though the last question sounds lighthearted, it’s not. Two of the 32 people in my Rhodes scholar class spent time in jail. Jeff Skilling of Enron fame was a classmate of mine at HBS. These were good guys—but something in their lives sent them off in the wrong direction."

"One of the theories that gives great insight on the first question—how to be sure we find happiness in our careers—is from Frederick Herzberg, who asserts that the powerful motivator in our lives isn’t money; it’s the opportunity to learn, grow in responsibilities, contribute to others, and be recognized for achievements."

"A theory that is helpful in answering the second question—How can I ensure that my relationship with my family proves to be an enduring source of happiness?— concerns how strategy is defined and implemented.

Its primary insight is that a company’s strategy is determined by the types of initiatives that management invests in. If a company’s resource allocation process is not managed masterfully, what emerges from it can be very different from what management intended."

"I tell the students that HBS [now]might be one of their last chances to reflect deeply on [the question of the purpose of their lives]. If they think that they’ll have more time and energy to reflect later, they’re nuts, because life only gets more demanding: You take on a mortgage; you’re working 70 hours a week; you have a spouse and children."

"For me, having a clear purpose in my life has been essential. But it was something I had to think long and hard about before I understood it. When I was a Rhodes scholar, I was in a very demanding academic

program, trying to cram an extra year’s worth of work into my time at Oxford. I decided to spend an hour

every night reading, thinking, and praying about why God put me on this earth. That was a very challenging commitment to keep, because every hour I spent doing that, I wasn’t studying applied econometrics. I was conflicted about whether I could really afford to take that time away from my studies, but I stuck with it—and ultimately figured out the purpose of my life. Had I instead spent that hour each day learning the latest techniques for mastering the problems of autocorrelation in regression analysis, I would have badly misspent my life. I apply the tools of econometrics a few times a year, but I apply my knowledge of the purpose of my life every day. It’s the single most useful thing I’ve ever learned."

"I have a limited amount of time and energy and talent. How much do I devote to each of these pursuits?

Allocation choices can make your life turn out to be very different from what you intended. Sometimes that’s good: Opportunities that you never planned for emerge. But if you misinvest your resources, the outcome can be bad. As I think about my former classmates who inadvertently invested for lives of hollow unhappiness, I can’t help believing that their troubles relate right back to a short-term perspective."

"You can neglect your relationship with your spouse, and on a day-to-day basis, it doesn’t seem as if things are deteriorating. People who are driven to excel have this unconscious propensity to underinvest in their families and overinvest in their careers—even though intimate and loving relationships with their families are the most powerful and enduring source of happiness. If you study the root causes of business disasters, over and over you’ll find this predisposition toward endeavors that offer immediate gratification. If you look at personal lives through that lens, you’ll see the same stunning and sobering pattern: people allocating fewer and fewer resources to the things they would have once said mattered most."

"If you want your kids to have strong self-esteem and confidence that they can solve hard problems, those qualities won’t magically materialize in high school. You have to design them into your family’s culture—and you have to think about this very early on. Like employees, children build self-esteem by doing things that are hard and learning what works."

"... when we choose between right and wrong. A voice in our head says, “Look, I know that as a general rule, most people shouldn’t do this. But in this particular extenuating circumstance, just this once, it’s OK.” The marginal cost of doing something wrong “just this once” always seems alluringly low. It suckers you in,

and you don’t ever look at where that path ultimately is headed and at the full costs that the choice entails."

"I’d like to share a story about how I came to understand the potential damage of “just this once” in my own life. I played on the Oxford University varsity basketball team. We worked our tails off and finished the season undefeated. The guys on the team were the best friends I’ve ever had in my life. We got to the British equivalent of the NCAA tournament—and made it to the final four. It turned out the championship game was scheduled to be played on a Sunday. I had made a personal commitment to God at age 16 that I would never play ball on Sunday. So I went to the coach and explained my problem. He was incredulous. My teammates were, too, because I was the starting center. Every one of the guys on the team came to me and said, “You’ve got to play. Can’t you break the rule just this one time?” I’m a deeply religious man, so I went away and prayed about what I should do. I got a very clear feeling that I shouldn’t break my commitment—so I didn’t play in the championship game.

"In many ways that was a small decision—involving one of several thousand Sundays in my life. In theory, surely I could have crossed over the line just that one time and then not done it again. But looking back on it, resisting the temptation whose logic was “In this extenuating circumstance, just this once, it’s OK” has proven to be one of the most important decisions of my life. Why? My life has been one unending stream of extenuating circumstances. Had I crossed the line that one time, I would have done it over and over in the years that followed.

"The lesson I learned from this is that it’s easier to hold to your principles 100% of the time than it is to hold to them 98% of the time. If you give in to “just this once,” based on a marginal cost analysis, as some of my former classmates have done, you’ll regret where you end up. You’ve got to define for yourself what you stand for and draw the line in a safe place."

All of this leads to Mr. Christensen's final statement, which is so profound that I suggest it's worth serious consideration as you decide your priorities each and every day:

"Don’t worry about the level of individual prominence you have achieved; worry about the individuals you have helped become better people. This is my final recommendation: Think about the metric by which your life will be judged, and make a resolution to live every day so that in the end, your life will be judged a success."

IRS Changes Its Mind On Issuing Refunds During Government Shutdown

noreply@blogger.com (Anonymous) — Wed, 02 Oct 2013 18:53:00 +0000

Photo credit: http://www.publicdomainpictures.net/view-image.php?image=20852&picture=stack-of-dollars

The following message has been posted to the IRS website:

"Due to the current lapse in appropriations, IRS operations are limited. However, the underlying tax law remains in effect, and all taxpayers should continue to meet their tax obligations as normal.

"Individuals and businesses should keep filing their tax returns and making deposits with the IRS, as they are required to do so by law. The IRS will accept and process all tax returns with payments, but will be unable to issue refunds
during this time." (italics added by me)

As the Journal of Accountancy points out, "This marked a change from its [the IRS's] shutdown contingency plan, under which 859 employees in its Information Technology Services Enterprise Operations were excepted from the general shutdown furlough to ensure 'refunds continue to process'."

The IRS has not given a reason for its change to also furlough these 859 employees, and to only process tax returns and tax payments, but not tax refunds, during the Government shutdown.

A Presentation About #OneForTheMoney by #MarvinJAshton

noreply@blogger.com (Anonymous) — Thu, 26 Sep 2013 05:25:00 +0000

Elder Marvin J. Ashton of The Quorum of Twelve Apostles
of The Church of Jesus Christ of Latter-Day Saints

Marvin J. Ashton gave a talk, "One For The Money" in the April 1975 Welfare Session of The Church of Jesus Christ of Latter-Day Saints General Conference. It has been reprinted numerous times and become a classic for his 12 Recommendations for Improved Personal and Family Financial Management.

I was asked to give a presentation based on this talk to a Preparedness Workshop sponsored by the church's La Verkin Utah Stake. I used Elder Ashton's talk as my outline (and the full talk was one of the handouts provided each participant) and then added additional information that would help this particular audience.

Please click on the line below for my full presentation, in both a written as well as voice recording versions:

1. Guiding Thoughts:

1.1. “The wind and waves will periodically interfere with our chosen course, even in financial matters; but the laws of the gospel can bring us back on course and guide us to peaceful waters.” -- Elder Ashton – April 1975 General Conference, Welfare Session

1.2. “I have been thinking of many things since we came to this meeting. I endorse what Brother Ashton has said. I think if I were starting with a young family, I would want to get the twelve points explained by Brother Ashton and follow them explicitly myself and teach my children and my family and everybody with whom I came in contact. It is basic. All my life from childhood I have heard the Brethren saying, ‘Get out of debt and stay out of debt’ I was employed for some years in the banks and I saw the terrible situation that many people were in because they had ignored that important counsel.

“I agree with all that Brother Ashton has said … with regard to family financing in the home. Every family should have a budget. Why, we would not think of going one day without a budget in this Church or our businesses. We have to know approximately what we may receive, and we certainly must know what we are going to spend … we do not spend that which we do not have.”

- - President Kimball, April 1975 General Conference, Welfare Session

2. Open Communication and Participation are Essential

2.1. How well you manage your money together is more important than how much money you earn

2.2. Both husband and wife should agree on money management decision and policy making

2.2.1. Control of money by one spouse as a source of power and authority causes inequality in the marriage and is inappropriate.

2.2.2. But … if a marriage partner voluntarily removes themselves entirely from family financial management, that is an abdication of necessary responsibility.

2.2.3.When children reach the age of accountability, they should be involved in money concerns on a limited partnership basis.

3. 12 Recommendations For Improved Personal and Family Financial Management

3.1. Pay an Honest Tithing

3.2. Learn to Manage Money Before It Manages You

3.3. Learn Self-Discipline and Self-Restraint in Money Matters

3.3.1. New couples should recognize that they cannot immediately maintain the same spending patterns and life-style as that to which they were accustomed as part of their parents’ family.

3.3.2. Show maturity by thinking of your partner’s and your family’s needs ahead of one’s own spending impulses.

3.3.3. Money management skills should be learned together in a spirit of cooperation and love on a continuing basis.

3.3.4. Advertisements entice us to buy by demonstrating how easy it is to get credit and buy on time. No ads focus on the glamour of paying the money back or how hard it is to do it.

3.3.5. Handout 1 – click here for a copy: “A Thought For Young People”

3.3.6.Handout 2 - The debt-elimination calendar from the "One For The Money" pamphlet, (click for a copy, the debt-elimination calendar is presented twice, once on page 5 with an illustration on how to use it, then again on page 12, this time a blank copy you can use for your individual situation)

3.4. Use A Budget (Handout 3 – the Budget Worksheet presented on page 7 of the "One For The Money" pamphlet,)

3.4.1. Carefully record all of your spending

3.4.2. “With the exception of buying a home, paying for education, or making other vital investments, avoid debt and the resulting finance charges. Buy consumer durables and vacations with cash.

3.4.3. Avoid installment credit, and be careful with your use of credit cards. They are principally for convenience and identification.

3.4.4. The use of multiple credit cards significantly adds to the risk of excess debt.

3.4.5. Buy used items until you have saved sufficiently to purchase quality new items. Purchasing poor-quality merchandise almost always ends up being very expensive.

3.4.6. Save and invest a specific percentage of your income.

3.4.7. Liquid savings available for emergencies should be sufficient to cover at least 3 months of all essential family obligations.

3.4.8. Every family should file honest and timely tax returns.

3.5. Teach Family Members Early The Importance of Working and Earning

3.5.1.“in the sweat of thy face shalt thou eat bread” is not outdated counsel.

3.5.2.One of the greatest favors parents can do for their children is to teach them to work.

3.5.3.Children should earn their money needs through service and appropriate chores. Some financial rewards to children may also be tied to educational effort and the accomplishment of other worthwhile goals.

3.5.4.It is unfortunate for a child to grow up in a home where the seed is planted in the child’s mind that there is a family money tree that automatically drops “green stuff” once a week or once a month.

3.6. Teach Children To Make Money Decisions In Keeping With Their Capacities to Comprehend

3.6.1. When teaching children to save, it is more meaningful if we help them set a worthy goal to save for – a bicycle, doll house, mission, etc.

3.6.2. It is unifying to have a child save for a major project, then when the amount was achieved, parents might match it with a predetermined percentage. Incentives are a powerful force in motivating and achieving desired behavior.

3.7. Teach Each Family Member To Contribute To The Total Family Welfare

3.7.1. This is a good topic to regularly include in family home evening.

3.7.2. Encourage inexpensive fun projects, understandable to the children, that contribute to a family goal or joy.

3.7.3. A great blessing can come when the family sits together regularly and each put in his share of the monthly amount going to a family member who is serving in the mission field.

3.8. Make Education A Continuing Process

3.8.1. Complete as much formal education as possible, including trade schools and apprentice program.

3.8.2. Use night school or online correspondence classes to further prepare.

3.8.3. This education is valuable to your potential lifetime earnings.

3.8.4. Acquire a special skill or ability that could be used to avoid prolonged unemployment.

3.9. Work Toward Home Ownership (Handout 4 -- click here for a copy: “Buy or Rent Your Home? Details to Help You Decide”)

3.9.1. Buy the type of home your income will support.

3.9.2. Maintain, improve, and beautify the home while you live in it.

3.10.Appropriately Involve Yourself In An Insurance Program

3.10.1.This includes sufficient medical, automobile, homeowners, and life insurance

3.10.2.Costs associated with illness, accident, and death may be so large that uninsured families can be financially burdened for many years.

3.11.Understand the Influence of External Forces on Family Finances and Investments

3.11.1.Inflation is real. A larger paycheck may not mean more purchasing power.

3.11.2.Beyond the emergency easily accessed savings, the family should plan for an utilize a wise investment program preparing for financial security, possible disability, and retirement.

3.12.Appropriately Involve Yourself In A Food Storage and Emergency Preparedness Program

3.12.1.Avoid going into debt for food storage.

3.12.2.Family gardens are helpful in many ways.

3.12.3.Eat nutritious foods and exercise appropriately to improve health, thus avoiding many medical costs.

3.12.4.Rotate your food storage by regularly using and replacing it. By making your food storage part of your regular menu planning, you can take advantage of sales and save on your overall food budget. (Handout 5 -- click here for a copy: "Increasing Savings Power Through Practical Shopping Tips")

4. Additional information sources for your consideration:

4.1.“Paying Off Debt As A Survival Strategy”, http://seasonedcitizenprepper.com/paying-off-debt-as-a-survival-strategy/

4.2.“101 Ways to Save a Dollar a Day”, http://premeditatedleftovers.com/deals-money-saving-tips/101-ways-to-save-1-00-a-day/

4.3.“4 Ways to Teach Your Children Money Management”, http://moneysavingmom.com/2012/09/teaching-your-children-money-management.html#_a5y_p=988112

4.4.Good ideas for using envelopes to help you stick to your budget: “How to $pend Money on a Budget”, http://www.thestraightenedpath.com/2012/01/how-to-pend-money-on-budget.html?m=1

4.5 Top 4 Tips to Getting Rid of Debt!”, http://snyderstellall.blogspot.com/2012/11/top-4-tips- to-getting-rid-of-debt.html

Thank you for your interest. I look forward to your comments and questions!

Marvin J. Ashton photo attribution credit: By Editors: Christie Williams and LeeAnn Roberts [Public domain], via Wikimedia Commons

#IncreasingSavingsPower through #PracticalShoppingTips

noreply@blogger.com (Anonymous) — Sat, 21 Sep 2013 06:42:00 +0000

I recommend 2 bloggers: @BlissDomestic & @TheBudgetDiet. Both wrote practical 2012

posts: #CutYourGroceryBillInHalf.

I hear all the time "I can't make ends meet as it is, there is no way I can save." That's why I'm so excited about this -- you can definitely cut what you spend on food by $100 - $200 - $300 a month, depending on your family size, and eat better than you eat now!

Here's some of the top tips from these bloggers:

Keep a record of what you currently spend for food. Include EVERY trip to the store. Challenge yourself to cut that in half by doing these things:
Avoid splurge purchases. Plan your meals in advance, emphasizing items on sale. Make a list of the needed ingredients and shop from that.
The longer time period you shop for, the more you can stock up on sales and make your supply last until the next sale.
Look at the price per unit. Sometimes there is a special on smaller sizes and you are better off buying more of them.
Be willing to buy in quantity and break the items down into individual sizes at home where you will freeze them until the time you plan to use them. Yes, this takes time, but usually less time than multiple trips to the store in a month will take.

And the Number One tip!

Leave your children home with your spouse, a grandparent, or another responsible adult when you shop. You will cut way down on impulsive purchases if you do.

You will want to check both blog posts for the links they give with sample meal plans, cook books, couponing aids, like-minded bloggers, and much more.

You can link to them from their Pinterest accounts:

Blissful and Domestic: http://www.pinterest.com/pin/310678074265626652/

The Budget Diet: http://www.pinterest.com/pin/155444624610114657/

Searching Pinterest for "Cut Your Grocery Bill In Half" will lead you to even more great ideas.

Photo Credit: publicdomainpictures.net

A Thought For Young People

noreply@blogger.com (Anonymous) — Thu, 19 Sep 2013 01:01:00 +0000

Photo credit: www.publicdomainpictures.net

I hope each of you reading this considers yourself young!

There were once two young people, trying to furnish their homes, get appliances, a living room and dinette sets, a television, a sound system, and a computer. Alas, when each of them priced these items after diligent shopping for “deals”, they discovered that the total was ten thousand dollars. They anguished with the thought that there was no way they could pay such a sum in cash, and so surely they wouldn’t be able to afford these things that they needed.

The first young person went home and found an offer
from a credit card company, guaranteeing him a card with a $10,000 limit, with an initial interest rate of only 3.9% for the first six months, and then 21% as a permanent rate. Excited, he called his friend! Now for only $310 each month he could have everything he needed – right now! In 48 months he would be paid in full. $310 was a lot of money to commit to every month, but it was possible, and compared to the thought of living without these essentials, it was a wonderful opportunity!

His young friend came home to the same offer in her mailbox, but she did not get as excited about it. She had always been taught to avoid debt, and although it would be hard to do without these items for now, especially when her friend had them, she was committed. So instead, she shopped sales and second-hand stores and found bargains as she could pay cash for them. She did want to have nice, new items when she could pay for them, so she saved the same $310 each month that her friend paid to the credit card company.

At the end of four years, the young man had paid his credit card debt and was pleased with his accomplishment. Unfortunately, the computer, sound system, and television were hopelessly out of date, and the other items were out of style. So he sold them at a yard sale for a few hundred dollars, which he spent on a short vacation that surely he had earned, and used his credit card to replace them with new items. He would just keep making the same payments and would have the pleasure of having new and up-to-date items in his home!

He called his lady friend to see if she was finally going to get some current stylish things for her home, and was pleased to learn that she was willing to go shopping with him. They both picked out items that again totalled $10,000. He paid with his credit card, and was surprised when she paid cash! When he asked how she had possibly come in to such a large sum of money, she smiled and said she had paid herself $310 each month for four years into a savings account that paid her a little interest, and that this had now accumulated to over $15,000! So she could pay the $10,000 cash, and have $5,000 left over to put into a Roth retirement account that would accumulate for her tax-free.

Another eight years passed. Each person kept following the habits they had formed. The young man got new items every four years on credit, made his payments on time, and was out of debt and had no savings at the end of each four year period. The young lady made do with used items for the first four years, and bought the same new items as her friend with cash every four years from then on. She consistently saved the same $310 each month her friend paid the credit card company in a short-term savings account earning a little interest. She had over $5,000 to invest in retirement savings each four years over and above the $10,000 she spent on furniture, appliances, and the like at the end of each of these four year periods.

At the end of these additional eight years, making a total of twelve years since the initial decisions, the young man was surprised to learn that his friend had averaged 8% yearly return on her investments and had already accumulated over $21,000 in her retirement account! (Compare that to the amount you have saved in the last 12 years – I hope it’s more than that, but has it been?)

When 20 years had passed from the initial decision, he was replacing his items for the fifth time and still had no savings, while she now had over $50,000 in long-term savings and had bought $10,000 of the items of her choice every 4 years in addition!

At 30 years, she had over $125,000, and yes, he still had no savings. At 40 years, she had over $287,000, and at 50 years, she had over $640,000!

The Congressional Research Service, a unit of The Library of Congress, on October 2, 2009 published a study titled “Income and Poverty Among Older Americans in 2008”. This study notes that “54% of Americans age 65 or over received income from assets in 2008.” This means that the other 46% of Americans over 65 had no savings or other assets that paid them income. The study further noted that half of those who did receive income from assets received less than $1,054 per year in such income.

This means that 73% of all Americans over 65 are totally reliant on Social Security and whatever pension they might be entitled to. Most of these changed jobs often enough that they had no pension, leaving them only with Social Security.

The difference is this: The 73% pay interest, and the other 27% collect it. Over a lifetime, that initial decision to pay cash can make a $640,000 difference! And even if you have only 12 years left to retirement, this one simple example could help you save $21,000 you wouldn’t have otherwise. Amazingly, this would still put you in the top quarter of Americans, measured by the amount each person has in savings at retirement.

The sooner you start the better, and it is never too late!

------------------------------------------------------------------------------------------------

Get Your Tax or Financial Questions Answered In A Future Blogpost

I choose topics for my articles based on the questions I receive most frequently from you. I appreciate your input! I originally wrote this particular article for my local newspaper in 1999, and have updated it in 2009 and again in 2013 to reflect the opportunities currently available.

Important Note!

The information in this article is intended to inform you of some of the financial opportunities provided in the tax laws or elsewhere. It is not intended to give you specific advice for your personal situation, since each case is different. If you need such advice, please contact a qualified professional!

© 1999, 2009, 2013 Doug Beecher, CPA, MBA, all rights reserved. This article, either as a whole or in part, may not be reproduced or transmitted in any form without the prior written permission of the copyright holder. When such permission is granted, the user must state that the material was used by permission of the copyright holder. Please note that it is usually preferred to link to this article rather than to copy it.

Sometimes Claiming All Your Legal Deductions Can Cost You More #Tax

noreply@blogger.com (Anonymous) — Sun, 17 Mar 2013 15:38:00 +0000

Most of us are awed by the complexity of even our own seemingly simple tax situations ... Yahoo Finance has an article that has some comfort along with good advice for you: http://finance.yahoo.com/news/6-tax-terrors-and-how-to-overcome-them-170130521.html

An additional thought: Try calculating it different ways before deciding on one. You can often save money, even on the simplest returns.

Here's a recent example I helped with:

A single person came to see me with just two W-2 forms and a donation receipt from a charitable organization. They were a renter ... so no mortgage interest or property tax, and had just a few medical expenses, and even less of anything else to claim.

Still, the state income tax withheld from paychecks along with the charitable contribution were enough to be larger than their standard deduction. Itemizing did increase their federal tax refund.compared with claiming that standard deduction.

Here's where it gets interesting.

They live in a state that requires you to itemize deductions for the state if you itemize on your federal tax return. Their state likewise requires you to claim the standard deduction if that is what you did on your federal return.

Because state income tax claimed on the federal return was added back to income on their state return, the result was a larger increase in state tax due than what itemizing saved them on the federal.

For them they had lower total tax by claiming the standard deduction on both the federal and state returns. It paid to look at it both ways before hitting the button to e-file their returns.

Yahoo's advice to ask questions and consider your various choices paid off. Your options are probably different than my example, the point here is to take a deep breath (or several) and carefully look at the options you have. Most of us do have more than one possible way to legally file our taxes. Don't wait to the last minute, so you have time to try it one way, then sleep on it and try another. Often this will save you money.