Another year has ended and that means it will soon be time to file your 2009 taxes.  It may not be the most exciting thing that the new year brings, but it is a necessary evil nonetheless.  However, tax preparation does not have to be dreadful event that most people believe it to be, so long as you are properly prepared.  To make things a bit easier on you, as well as your tax preparer, here are a few simple techniques to get yourself ready:

• that negatively with plavix interact drugs

• Take an envelope or folder and mark it “2009 Taxes” to house all of the records you will use when filing your 2009 1040
• Make a list of all of the interest-bearing accounts you have (including checking, savings, & certificates of deposit)
• Add all of your brokerage accounts to that list
• Also include all lenders whom you paid mortgage interest to and all counties/taxing authorities to whom you paid real estate taxes to
• Make a separate list of all of the partnerships or S-corporations that you have an interest in
• Each time you receive a form K-1, 1099-Int, 1099-Div, 1099-R (Retirement disbursement statement), 1098-E, or tax statement cross off the name of the payee from the list until they are all marked as received.
• Start to gather all of the information related to stock or mutual fund sales you made during the year as many brokerages do not have records of purchase prices or dates for holdings that were transferred in from other brokerage accounts
• Get all of the information together related to any rental properties you may own: rent receipts, utility bills, mortgage statements, real estate taxes, repair invoices, insurance bills, etc.
• Pull all of the receipts you plan to use when filing your taxes, including but not limited to: charitable donations of cash or goods, unreimbursed business expenses (gas, tolls, meals, travel, supplies, etc.), education expenses (and educator expenses if you are a qualified educator), child-care costs, documented moving or job search expenses, medical expenses, medical insurance premiums, etc.
• Call any pharmacies you use and ask for an annual account summary for the year outlining all of your prescription costs.
• Pull any receipts for large purchases made during the year, which may include automobiles, appliances or other big-ticket items (your tax preparer will know which one can be used)
• Place all of these items in the folder along with any other items that you may need to use as supporting documentation
• Keep the folder on your desk at all times as a reminder to keep organized and not to wait until the last second to bring your documents to your tax preparer to file your 2009 taxes.
  • vs thyroid synthroid armour

Naturally, this is a very simplified list, everything may not apply to your individual tax situation or you may have a much more complicated tax situation.  In any case, this is just something to help get you started on the right path in filing your 2009 tax return, and not making the mistakes that many taxpayers make: waiting until the last second to file, or not being prepared and losing out on deductions due to missing or incomplete information from lack of planning and organization.  While you may benefit by requesting an extension to the filing deadline, keep in mind that you will still be responsible to pay interest on any tax liability you may have when everything is said and done.

Yes, it’s getting close to that time again. Christmas has passed, New Years is in the rear view mirror, and pretty soon, you will be getting a bigger-than usual envelope from your employer. No, I’m sorry to say that I’m not referring to a cash bonus, although that would be wonderful. I’m talking about your annual W-2 forms, which means that tax season is upon us. For many, it is a time of dread due to their lack of organization when it comes to saving receipts and related documents, for others it is a time of joy since they will be getting their planned refund to finance the family vacation. Some people have a tax preparer that they trust and have been with for years. Most likely, I am not speaking to them with this message. No, this message is for those who is searching for the right person to handle the task of preparing their taxes.

During this time, you will hear commercials for the popular national chains on the radio and see them on tv, read about the local guys on craigslist.com or in your local paper, and even hear about a “friend of a friend” who’s sister used this guy out of an “office” with the shades drawn who got them a huge refund that was more than they thought was possible.  Unfortunately, there are plenty of unscrupulous folks out there that will mislead/misguide you, pay no real attention to you, or simply do a horrible job.  Now, there is no perfect way to find out about a person/company, since as of now, there is no licensing requirements to be a tax preparer, but there are steps that you can take to ensure that you are getting someone qualified, and the best way is to ask questions.  (Below I have also posted some interesting links from craigslist.com which I found to be very scary)

• First and foremost, ask what kind of qualifications the actual preparer has (especially if you are going to a franchise).  Ask about the education of the preparer, the nature of their primary career (whether or not they have a background in accounting or tax law)  how long they have been preparing returns, and the complexity of the returns they have experience with. This ad is for Liberty Tax Service which extends possible employment after taking a short, free course|
  This ad is for an unnamed entity which prefers experience, but will hire and train
  Here is another Liberty Tax Service ad, which offers employment after a one week course
  This one is good.  They have no mention of qualifications needed yet want applicants to tell them why they are the best choice to join this “award winning” team.
  This last one doesn’t even care about experience as they will train you, but made sure to mention no vulgarities
  
  There is no way that anyone should be entrusted to touch another person’s taxes after only having a week’s worth of training.  Especially important is when using the franchises, who are notorious for using inexperienced preparers, but they also tend to hire people who are doing this as a supplementary income source and may not put as much care and effort into your return.

• Another crucial question to ask is how the preparer will be paid.  Accountants who prepare taxes within a firm are almost always strictly on a salary.  They get paid the same rate regardless of how many returns are prepared or how much the billings run.  On the flip side, I have noticed that many ads looking for tax preparers are offering only commissions or are a low salary/bonus situation like the ads belowThis ad lists payment as only commission, but at least they want experience
  This ad pays prepares a lowly salary while offering unknown incentives, but again, at least they look for experience
  Here’s one that offers a 15% commission on the amount invoiced

  This method of payment practice doesn’t seem very ethical to me (just a personal view).  It suggests that the company is only interested in volume.  When volume is a primary concern, the speed with which the returns are prepared is paramount to the quality with which they are prepared.  That might bode well for the individual preparer and for the company, but for the taxpayer, it is dangerous.

• Don’t forget to ask about the company pricing policies, either.  It is just as important to understand and be comfortable with how much you are going to have to pay before you get invoiced (which is generally upon delivery of the completed product).  Every firm has a different way of charging for their services: by the hour, by the project as a whole, by the project broken down by additional schedule.  Whatever the method, anyone charging too little should be second-guessed just as much as someone charging what appears to be too much.  Don’t be afraid to call around and ask for quotes, even if they aren’t exact, as well as go in and meet people in person to see what kind of feeling you get.

Overall, there is more than simply the cost that should go into your decision as to who and where you get your taxes prepared.  In my personal experience, you will pretty much get what you pay for.  If you pay a little, you will get shoddy service both on the return as well as follow-up treatment.  If you pay what seems to be an exorbitant fee, you are most likely paying for more than just a tax return but not receiving any value in exchange.  Some preparers are not very friendly, and are all about business, while others will talk your ear off and make you wonder if they ever get around to doing any actual work.  The choice ultimately comes down to who makes you feel the most comfortable, but no matter what direction you choose to go, having as much information as possible will help you make the best choice.

At the end of May 2008, I was laid off from my job of 4 1/2 years due to the company’s inability to maintain it’s then-current employee base. I wasn’t too worried, as I had plenty of savings to cover almost 6 months worth of expenses in my HSBC Direct Online Savings account, plus I had been working on building GreenBridge Advisors, which hopefully was going to start to take off soon. And, to be quite honest, I thought that I wouldn’t have that much trouble finding a replacement job (didn’t we all). Well, as it turns out, it took me almost 8 months to find a steady gig (although there were some temporary projects in between that helped), but as many people out there can attest to, I needed to swallow my pride a bit and take somewhat of a pay cut. Then the Obama Administration’s “Making Homes Affordable” program came to pass, which was supposed to help the millions of people in trouble with their mortgage situations, so on September 19th, I finally decided to check it out.

Since Chase is my mortgage servicer, I started there, going to their page outlining the steps to take. This was a bit confusing to say the least. Step one was to call to discuss your situation, which on its own made sense. However, the second and third steps were to explain what had happened and gather the information, respectively, which made little sense. I would tend to thing that gathering the information would be the most important step in the process, since being organized and having all the pertinent information ready would be necessary to complete the other step. Then, you should call the service center and discuss your situation, having the ability to reference the information you gathered to best provide the representative with anything they may need. The last step was to download and complete the documents, which seemed like an entirely new mortgage application with a personal information sheet, employment verification, personal financial statement, statement of monthly expenses, summary of the circumstances surrounding your request, as well as all of the prerequisite pay stubs, bank and investing statement and anything else that supported your valuations on the financial statement.

Well, I did things my own way by filling out the document package first, figuring that if I had everything all completed and organized in front of me, that I would be in a much better place to provide the representative with anything they may need. So, after spending quite a bit of time filling out everything and completing the summary as best I could without writing a novel, I made the call. As it turns out, the woman who answered my call (after only a few seconds, which was a welcomed surprise!) informs me that there is no phone call necessary, and that there is no”pre-screening” process by which any of your information is put into a database or an account agent assigned to your particular case. All you have to do is complete the paperwork and submit it to them, plain and simple.

She was very knowledgeable, I must say, as I asked a variety of question that didn’t necessarily apply to my situation but which I was curious about nonetheless. One of my main concerns for my own situation was the use of an appraisal in determining worthiness of any kind of assistance. I found it particularly interesting that among several sites, my residence could be valued anywhere between $72,000 and $219,500 which is quite a spread, so that is what lead to my curiosity. I know for a fact that there have been many foreclosure sales in my area, and judging by some of these websites that “value” properties on the internet (including Chase’s own estimator), that they are taking these sales into consideration when valuing a property. I also know that appraisals are generally supposed to exclude distressed sales such as foreclosures, so I wanted to know what I had to look forward to. She informed me that there was no appraisal, since I was only looking at a rate adjustment, and therefore, there would also be no fees or closing costs unless I went with a straight refinance.

After everything was said and done, I took my packet, walked over to my fax machine, and sent it on its merry way over to Chase, as I was told that when using this method, the application gets logged within a few hours. I also sent another set via FedEx the following Monday morning just to be sure that they would receive the entire package since I have plenty of experience with not getting faxes, or having the recipient’s machine have difficulty. Now, for the worst part of the whole process: I have to wait 6-8 weeks for the application and documents to be reviewed and processed and for them to notify me of any decision! That seems like a very long time considering the goal of this program is to help people in need. I mean, in 2 months, someone can go from being current with their payments to delinquent and get disqualified from this particular aspect of the program, thereby having to switch to one of the other options, and starting all over again. Then again, at least the government is doing something to help the people it serves, rather than just the companies this time.

While it may be a little early in the year for tax talk for some, I personally believe that it is never a bad time to plan or even talk about taxes. Today, I happened to see a tweet linking to an article on Kiplinger’s Website for a section called 10 Ways To Lower Your Taxes. I read it and was left wondering, first if the editors fact check this information since the author, Kimberly Lankford does not have anything regarding an accounting or tax background on her mini-bio (and no, I am not taking a shot at her personally) and secondly, why the entire story is not told about such deductions. Articles like these, whether in financial magazines or on blogs geared toward personal financial topics seem to be guilty of stating a deduction, and then summarizing them without going into full detail including the drawbacks and limitations. Below, I will mention just a few of the most common deductions that are mentioned which I feel need to be explained a bit further, and not all simply from a tax standpoint .

• Selling off investments that have lost value: This is a very bad idea right from the start. The first reason is that you can only offset $3,000 of income after countering capital gains with the losses. It would make sense if the advice was to sell enough losers to first wipe out any gains you may have had, and then just enough to reach the $3,000 limit. You get no bonus points for carrying a loss forward, and there is no guarantee that you will even have any gains in the following years in order to use up and loss carry-forwards. Simply because you want to save a little bit on your tax bill now is a terrible reason to sell stocks or funds that are down. The second reason why it is a bad ideas is because there was a purpose behind investing in certain fund or individual stocks, and unless that purpose has changed, there is no need to dump it for a small benefit today. If the purpose of the purchase was because of the high dividend yield, then you will be giving up an even higher yield since the price is now lower but the rate is either the same or higher.

• Giving to charities: This is another one that confuses me. To begin with, you can only take a deduction if you itemize, and that is a fact that escapes many people. If you are looking to lower your tax bill, especially if it is due to the fact that you need the extra money in the refund, then why would you spend money to save even less on your return? It is counter-intuitive. It is one thing to donate because you want to and can afford to, but if you are in such dire straits that you need to scratch and claw for every penny you can get back on your return then donating to charity is not the way to go about finding those extra pennies. Also, what many advice articles do not mention is that the IRS has established guidelines for what are reasonable amounts of donations based on income levels, and anything above those figures may flag the return for a potential audit. All will be fine if everything you reported is on the up and up (and not just when it comes to the donations), but if not you better be able to come up with a pretty good rationale for why you did report what you did or else face not only paying the tax that would have been due had the correct numbers been used, but also penalties and interest are attached. Worse yet, once you are audited and found to be guilty of falsifying your return or abusing certain privileges, you will then be on the IRS watch list, and no one wants to be in that position.

• Prepaying mortgage : This is a simple one to explain. Very plainly, the IRS has established guidelines that state that a deduction can only be claimed for the portion of the expense that was allocated to the current year. In plain English that means if you pay your January mortgage in December, the 1098 will only contain the interest that was paid and applied up until December 31. If you report more and try to justify that you are including it due to the fact that you made the payment in the current year, guess what: you’re wrong. Since the interest portion of your payment was originally allocated to the next year, you are disallowed from claiming it early.

• Real estate taxes: Another pretty simple one. You cannot claim any deduction unless it was paid in the current year. Everyone knows that the assessments are sent out in August or September and that the bill goes out in November, but just because you were issued a bill does not allow you the right to claim the deduction. You must have physically paid the taxes by December 31 of the current year in order to get the deduction. There is a bright side, however, and if for some reason you do not have the ability to pay that bill in the current year, you are permitted to claim the deduction in the following year when you do finally pay it.

• Buying a home is a great tax write-off: I’m not sure where to even begin. Many people, particularly the frugal will tell you that buying a home simply for the mortgage and real estate tax deduction is a horrible idea. Beside the fact that you will generally take on a great deal of debt, certain other factors come into play. If you happen to buy into an area that has a homeowners association, or if you purchase a condo, you will have to pay association fees which are not deductible. Then you have guidelines by which you must follow in regard to upkeep and appearance such as: lawn maintenance, cleanliness of the sidewalks and roof, replacing damaged portions of the visible domicile (ie: driveway and roof). And, in order to even receive the deduction for the real estate taxes, you must (as was mentioned previously) actually pay them, and this is one of the top areas in which people underestimate or even exclude from their budget when considering a home purchase. If you can afford to do so, then a home certainly does provide many tax breaks, although the breaks alone do not justify making such a large investment.

• College/post-secondary expenses: This may be one of the more difficult deduction to figure out, especially since there are multiple deductions to choose from and the rules are about to change. But one thing is very clear: not every expense is allowed in the calculation of qualified expenses. Tuition and associated fees are the only costs that are deductible, or to put it another way, only those costs that you pay to matriculate and sit in a class are deductible. So what does that leave as non-deductible? Well, pretty much everything else: Room and board (including meal plans even though most freshman are required to buy them) or costs of living (if off campus); transportation fees; student life fees (sports and activities fees); books, supplies and lab fees, insurance and medical expenses. Unfortunately, that is the way it is, and equally unfortunate is the fact that this distinction is often left out of the discussion on the topic giving taxpayers false hope for a large deduction.

Again, this is just a list of the more common deductions that are not often fully explained. Almost every deduction has limitations of some sort, but many of the other major ones get full attention when it comes to their discussion. The only thing you can do is to educate yourself to the best of your ability on the ones that apply to you, or pay an experienced professional to prepare your taxes and know that in most instances, they have a much better understanding of the tax code and will get you the deductions that you truly qualify to take and save you the risk of being audited by ignoring the ones that you have no business even going near.

Dear credit provider,

In light of the housing and credit crises of the past few years, I am left wondering about some of your practices in regard to the way you choose how to extend credit lines and how you deem certain applicants to be worthy of receiving a line of credit. In the past, I have been a very big proponent of using credit as a financial tool, and of people taking responsibility for their financial situation, not blaming credit providers. While I haven’t necessarily changed my views entirely, I have begun to question whether or not the credit industry deserves the support it has been receiving from not only myself, but others as well.

Seeing as there are so many homeowners in foreclosure proceedings or facing the inevitable event of being foreclosed upon, one has to wonder how you chose the recipients of the funds you lend and the mortgages you underwrite. Did you not think that anyone who needed 100% percent financing or more-up to 125% in some instances as I have seen- was going to struggle keeping their loan repayments current, or even being able to make the payments at all? How about those people who were so risky that they were required to accept double-digit interest rates in order to secure a loan while standard rates were no where near such figures? And what about the potential home buyers whose mortgage payments figured to be more than half (or even a greater percentage) of their gross incomes, let alone home much of their net income it would consume considering net income is a much more accurate figure to use? All of these situations were contributing factors to both the housing and credit problems facing the American public, yet seem to be almost entirely born out of short-term vision, with a blind eye toward the long-term effects of such deals.

I am also curious about how you go about choosing who you market your products and services to such as credit cards. Is it simply sending out pre-approval letters to anyone whose name appears on a purchased marketing list? It’s pretty interesting how many people report receiving pre-approval letters in the names of children (particularly babies), family pets, and even the deceased! I mean, really, do you verify any of the information you purchase from data collection firms say, by doing credit checks or some other verification method? Perhaps if the focus were to shift from the quantity of pre-approvals you can send out to the quality of the recipients, the risk involved in extending credit to these people would be reduced significantly. By shifting that focus, maybe, just maybe, you would be able to bring about a rebirth of credit as a beneficial tool rather than an abused and overused component of the financial landscape.

Speaking of credit cards, perhaps you can also enlighten me as to why it is that you would simply increase a cardholder’s credit limit out of the blue. Actually, how do you even come up with credit card limits to begin with? Wouldn’t it make more sense to start cardholders off with a reasonably low credit line, thereby putting the onus on the cardholder to prove their creditworthiness and make them ask for an increase should the so desire? I cannot even begin to recall the number of times I have read or heard about people in financial distress who said that they got deeper in the red because of the additional credit that was extended to them unrequested, and which they used simply because it was there. Why not follow this strategy to avoid such further stories, and save yourself quite a bit of trouble all while leaving no one for the credit abusers to point fingers at other than themselves?

As I have stated ,I am a staunch supporter of credit as a financial tool, but you are making it difficult to continue defending you from all of the detractors. Most businesses find it beneficial to be consumer-friendly and provide value to their customers, but in recent years you have only shown a propensity for greed and disregard for the consumers. All that has been displayed is an interest in increasing profits and padding your bottom line, no matter what the end result of your reckless actions may be or who gets stepped on in the process, as long as you benefit. Hopefully, you have seen the error of our ways and are prepared to start putting the sonsumers first, considering that without people to borrow money, you would be out of business.