With tax season coming up, many people are already planning how they will spend their tax refund. In order to get more people coming through their doors, accounting companies are promising to give you the expected refund on a secured credit card as soon as your taxes are filed. In these hard times this is a tempting offer. After all, who couldn’t use a little extra money during these economic times? Although you may be tempted by these claims, there are a number of reasons why you shouldn’t be depending on this type of refund anticipation loan to pay off your bills.
By using this refund anticipation loan instead of simply waiting for your refund check to be mailed to you, you are looking at losing money over the long term. The amount of fees that come with using this “Emerald Card” are staggering. Unless you are in significant need of your tax refund right away, there is a lot of benefits to simply waiting a little bit longer to receive your money. Unless you are about to file for a Minneapolis bankruptcy and are advised to take this type of loan by a Minnesota bankruptcy lawyer, you should consider the number of fees that are included with this type of loan.
There are a number of fees associated with using an Emerald Card to collect a refund anticipation loan. Each time you want to use your Emerald Card at the ATM there is a $1.50 fee that will come out of your tax refund anticipation loan. You may think that you can get around this fee by simply walking into your bank and talking to the teller. However this does not work either as there is a 1.5% fee on any withdrawals that are taken out. These are only a smattering of the fees that come with accepting a refund anticipation loan. Although it may be necessary for some who are truly desperate for the money, in the majority of scenarios it is a much better idea to simply wait a few extra weeks and allow the government to mail you a check for your refund.
IRAs are individual retirement arrangements and this provides a great benefit in the form of a retirement package for retired service people. One can benefit from various such IRAs such as Roth IRAs which were named after Senator William Roth Jr. , self directed IRAs, SEP IRAs etc. This helps the retired working professionals earn a special annuity from their previous employers through some annuity trust arrangements. This is eventually invested in various other investment opportunities such as insurance bonds, government bonds, shares, stocks, real estate, etc.
This is one great way of saving more on your hard earned money and not letting it go away in taxes. In a traditional IRA arrangement, it allows you to not pay anything unless and until you have earned or withdrawn anything from your account. IT has special incentives for regular investors as well as senior citizens. In a Roth IRA arrangement, one can make contributions with deducted monies but also one can earn without paying any tax in the near future. A Roth IRA will put a tab on the distributions on various accounts, but all of them shall be allowed.
IRAs have their main purpose of being in quantifying retired savings into a wealthy sum that retired workers could reap its benefits off in the near future. It helps in boosting top rated ira funds, best mutual fund companies. All this tax-free money could be used to pump into a fairly appreciating real estate investment plan. However there is a fair amount of risk in the initial stages of IRA real estate investing. These deals often involve the caretaker of the underlying assets often known as custodians who need to be directed and informed about ones investment decisions.
A persons decision to go for the SEP IRA arrangement is very well rewarded once he starts making contributions to the required funds. A Simplified Employee Pension plan, better known to taxpayers as SEP, helps the employers of the retired employees to be a part of the contributing force with tax-deductible services.
When it comes to tax lien investing, there are several tips you need to keep in mind. First of, it would be better to buy liens at smaller countries. The individuals who are bidding for large companies to invest their money in tax lien certificates are institutional bidders. Since there will be less liens to go around, it’s possible they won’t bother to attend tax lien sales at smaller countries. Besides, the liens may also be smaller.
If you buy smaller liens, then you may get higher interest rate because there will be less competition. It would also be advisable to stay during the off times of a sale. Prime examples of these are lunch breaks, end of the day, and last day of a sale. When you catch the people asleep, then you can get the good liens.
Also, try to go up to the clerk and ask if there are any more liens for sale. This is very important because there are investors who will purchase too many liens and at the end of the day, they’ll realize that they can’t afford to purchase all of them. These will not be re-auctioned by the county. For this reason, most will sell them to you over the counter at the maximum percentage interest.
Setting max bid amounts is another thing you should do. Don’t hesitate and wait until the bidding has settled and the bidders have dropped off. Afterwards, you can go for the decent sized increase but don’t forget your limits. It would also be a good idea to buy from company names that you recognize. Buying from commercial properties would mean that the liens will definitely redeem.
Remember that in tax lien investing, you put your money into tax liens that are created by county governments. Large sums can be provided but you may also face risks. A great tip would be to understand the risks before getting involved in this market.
Investing in tax liens is lucrative. That’s because you can get higher returns unlike in traditional forms of investment. If you foreclose on the property and sell the house, then the returns can be amplified. But as mentioned earlier, this isn’t a foolproof investment and it could be difficult to get your money back if the IRS has a lien on the property or if the homeowner files for bankruptcy.
Small Business Often Overlooks Tax Deductions
You can have a successful tax season in your small business if you plan all round the year so that the deductions are maximized. This requires that tax matters should be kept in mind at all times, and you must constantly look for methods of reducing your bottom line, while continuing the profitability of the company.
Expenses for Start-Up
The expense of starting a business is quite often overlooked by small businesses and this can give one quite an advantage when the tax season is being considered. It is possible to deduct the expenses incurred for overhead,marketing and other expenses that are related and this can be done for a period of five years after starting the business. However the deduction of such expenses is only allowed after you have actually started the business and cash flows have commenced.
Education and Training Has To Be Continuous
A continuity in training and education, makes you eligible to deduct the expenses incurred for this. Attending a conference on new trends for treatment of cancer in horses allows a veterinarian who specializes in treating horses to deduct the expenses of attending that conference. As the conference is related to the field in which the veterinarian is practicing this seminar can be a part of the deduction form the yearly tax. However if he is not practicing in that field and only treats smaller animals, he would not be eligible for any deduction. The rules for the classes that qualify the deduction are quite strict.
Fees for Professional Services
Any professional fees that you pay to your accountant can be deducted from taxes.If however the work is for future years, the benefit has to be spread out over the term envisaged. If you have hired an architect for designing a building that may take two years to construct,the architects fees have to be spread over the period during which the building construction takes place.
Volunteer Tax Assistance is available from an IRS sponsored program this tax season. This community-based program is operated by volunteers who will assist with 2010 tax preparation. The top ten items the IRS wants taxpayers to understand about the IRS sponsored volunteer programs are:
- There is tax assistance available for taxpayers that are 60 years old or older.
- This program offers free preparation to individuals or families who earn $49,000 or less.
- Electronic filing is available at all volunteer sites
- The volunteers have been educated on topics such as the child tax credit, homestead tax credit, and the elderly tax credit.
- Several tax assistance sites have volunteers who can help people with English as a second language.
- Partnerships with community organizations make it possible for the IRS to offer more 12,000 tax preparation sites. All sites offer the services free.
- The AARP tax-aids do primarily assist people who are 60 and older, yet they are willing to assist any taxpayer with low-to-moderate incomes.
- The Armed Forces has a volunteer tax council that is trained to understand tax issues that are specific to military individuals and families. There are volunteers available for all branches of the military.
- City information hotlines, community organization, and the public libraries can provide information on the locations and dates for the volunteer tax assistance programs for 2010.
- Call the toll-free number for the IRS at 1-800-906-9887 if you are having trouble locating a volunteer tax assistance program near you. If you have internet access, you can gain information using the following web address: www.IRS.gov. Visit AARP.org to find an AARP Tax-Aide location or call 1-888-227-7669 (888-AARPNOW).
It is wonderful when community volunteers work together to help people prepare their tax forms. No one should feel alone or overwhelmed while preparing their 2010 taxes. The IRS Volunteer Tax Assistance, 2010 is available as a community based program.
- You Can Avail Of Volunteer Tax Assistance For Your 2010 Taxes (goarticles.com)
- Why Everyone Should Use IRS Efile (2011taxes.org)
A Roth IRA is a retirement plan, the money placed into the account is taxed but the money withdrawn is tax free. There are specific rules that apply to a Roth IRA as well as many advantages to owning one.
The rules for Roth IRA’s are as follows for the funds to be tax and penalty free. The account must be a specific number of years old, this is known as a seasoning period and currently this period is at five years. Also the growth over principal in a fund can only be withdrawn penalty free if the owner is of retirement age.
A person can convert to a Roth IRA from a traditional IRA, and any money in the Roth IRA from the traditional IRA can be withdrawn penalty free. Granted the seasoning period of currently five years must have passed on the money converted. If a Roth IRA owner dies, their spouse will become the sole beneficiary.
If the spouse has a Roth IRA of their own then they can combine the two plans with no penalty. A person can make contributions to a Roth IRA even if they contribute to another retirement plan. This is also true of a traditional IRA but it may not be tax deductible.
A Roth IRA does not demand that withdrawals start at any specified age. In a traditional IRA at a specific age a person has to start taking out the minimal required amounts of money. In a Roth IRA if the money is not needed currently the full amount can be passed to an heir.
To the amount of $10,000 in lifetime earnings can be withdrawn tax free if used by the owner to buy a house for the first time. The house itself must be acquired by the owner, spouse, or direct ancestor. Any of the relatives receiving the home must not have owned a house in the last 24 months.
Listed above are some of the advantages to owning a Roth IRA account. To be remembered as with all retirement accounts there are disadvantages. Research should be conducted when deciding which plan is best for a specific individual.