Monday, February 4, 2008
Taxes
The very mention of paying taxes can bring on confusion and dread, but filing tax returns online can be easier and less stressful.
Doug Borkowski, financial counselor at the ISU Financial Counseling Clinic and lecturer in human development and family studies, said tax returns provide information to the IRS that helps determine how much money will be available to run government operations.
Borkowski asks, why pay someone to do your taxes, when you can do them for free online?
"Taxes aren't this big daunting thing," he said.
There are three different tax forms: The 1040, the 1040A and the 1040EZ. A person's financial status determines which form should be used.
Borkowski said Form 1040 is the "most inclusive for someone and the most complicated of tax returns." Business owners and people with many deductions use this form.
Form 1040A is not as complicated and allows fewer deductions.
Form 1040EZ a basic one-page form, applies to most college students.
"You earn wages, but you aren't worried about most of the tax credits," Borkowski said.
Who has to file tax returns?
"A lot of students wouldn't have to do a tax return [if] their income is low enough," Borkowski said.
Borkowski said dependent college students with income under $5,350 would want to inform their employer that they are exempt from withholding. This means they do not need to file tax returns.
However, dependent college students who make more than $5,350 must have income tax withheld from their pay and should file tax returns. By doing so, it's possible to receive a refund if the tax withheld is less than what you should have paid for the year.
How do I file tax returns?
"It's free to do [online], as long as your income is under $54,000," Borkowski said.
Borkowski said the first time someone files online, he or she has to send in an online filing form, but after that, the process will be "totally paperless."
Borkowski recommends TaxAct.com as a user-friendly site to do tax returns.
Some benefits of filing tax returns online are getting refunds back more quickly and- since online programs take you through each step - an easier process than the paper form.
Borkowski cautions those who intend to file their taxes online to do so from a secure connection rather than an unsecured wireless connection.
Fazli Sabri, graduate student in human development and family studies, who is married with a family, said he will use the money from his tax returns for his family.
"It should be no problem for other people to do," Sabri said.
When should I file my tax returns?
Borkowski reminds students that the deadline to file tax returns is April 15 - but it is possible to file for an extension.
If you are overwhelmed or have questions about tax returns, Borkowski encourages students to schedule an appointment at the Financial Counseling Clinic.
The College of Business also offers guidance with filing returns.
Tax Returns 101 tips from Doug Borkowski
Steps for filing tax returns online
1. Have a copy of your W-2 Form either on paper or online
2. Go to www.irs.gov
3. Click on "Use Free File to Prepare your Taxes" and Start Now
4. Pick a program
5. Read and follow the steps
Financial Counseling Clinic: Call 515-294-8644 to make an appointment
Sunday, February 3, 2008
Regular Savings
KEPALA BATAS 2 Feb. - Simpan RM5 sehari akhirnya dapat kereta Perodua Myvi - demikian tuah Ku Kim Lian, 74, yang sentiasa sabar menabung dalam bank walaupun dalam jumlah sedikit. Kesabaran dan kesetiaannya menyimpan di Bank Pertanian Malaysia (BPM) cawangan Kota Bharu setiap hari sejak 1992 itu melayakkannya menerima kereta sempena kempen Anugerah Patriotik BPM.
Kim Lian, seorang peniaga di Pasar Siti Khadijah, Kota Bharu berkata, dia akan singgah ke bank tersebut ketika hendak membeli nasi untuk makan tengah hari atau sebelum pulang ke rumah selepas selesai berniaga. ‘‘Mak cik jual udang, sotong kat pasar. Paling sikit simpan RM5, paling banyak RM20,” katanya kepada pemberita selepas menerima kereta tersebut pada majlis Perhimpunan Warga Tani di Dataran Penaga di sini hari ini.
Dia yang ditemani oleh anak saudaranya, Ehdee Plu, 48, dibawa khas oleh BPM cawangan Kelantan bagi menerima hadiah tersebut yang disampaikan oleh Menteri Pertanian dan Industri Asas Tani, Tan Sri Muhyiddin Yassin. Kim Lian yang masih bujang memberitahu, dia jarang mengeluarkan wang simpanannya itu kecuali untuk tujuan perubatan.
Ujarnya, dia tidak pernah terfikir akan mendapat kereta tersebut kerana tujuannya menyimpan adalah untuk kegunaan hari tua dan apabila sakit. Kim Lian ketika ditanya apa yang akan dilakukan dengan kereta Perodua Myvi 1.3 Auto tersebut hanya tersenyum dan sempat bergurau, “Balik ni mak cik kena belajar ambil lesen.”
Tuesday, January 29, 2008
Monday, January 28, 2008
Beware of "Free Trial Offers"
This week's tip comes directly from the Iowa Attorney General's office - each month they send a Consumer Advisory. This is their advisory for February 2008. The website with all their past advisory notices is given at the end of the article.
Study your billing statements for unauthorized charges.
Some consumers are being charged for products or services and don't even know it. This happens especially when consumers receive "free trial offers" for buying club memberships, travel clubs, or "credit card protection plans" -- and then are charged automatically on their credit cards or bank accounts when the free trial period ends.
Consumers often are surprised when - and if - they discover the unexpected bill. The problem seems to stem from two things: First, consumers may not realize a seller already has the key information to bill their credit card or checking account. Second, some sellers use questionable tactics to try to shift the burden onto the consumer to cancel.
If you don't cancel within the "free trial offer period" (usually 30 days), your credit card will be charged the monthly or annual membership fee, possibly as much as $100 or more. And you may be charged repeatedly every month or every year if you don't cancel.
Questionable "free trial offers" may come in several ways: On the phone: You may order a product or ticket or make a hotel or car reservation - and then the telemarketer may ask you to consider a "free trial offer" membership. In mailings: For example, a bank or credit card statement may include a check made out to you for a small amount (say, $10 or $15) -- with fine print that signs you up for some kind of program and monthly or annual charge if you cash it.
Over the Internet:: You may order something over the Internet and receive a "pop-up" ad on your computer screen with the "free trial offer." Remember, sellers may already have access to charge your credit card or checking account -- and they will bill you after the free trial period without further approval from you. They count on you forgetting, not nooticing the billings, or not noticing if they send you a mail notice that you discard as "junk mail." And some unscrupulous sellers may start billing you even if you decline the free trial offer!
Don't be trapped by "free trial offers":
• Reject a free trial offer unless you are absolutely sure it is something you will use. Make it very clear to a phone solicitor that you are declining the offer. Don't cash checks mailed to you that trick you into signing up for a program and paying for it.
• Examine your credit card bill every month, and your checking account and phone bills, too. Watch for unauthorized charges, and dispute them at once, in writing.
• Watch your mail carefully. (Some cancellation notices look like junk mail.)
Source : Barb Wollan, ISU Extension Family Resource Management Specialist
Saturday, January 26, 2008
Keep Those New Year's Resolutions
Barbara O'Neill, Ph.D., CFP® Extension Specialist in Financial Resource Management Rutgers NJAES Cooperative Extension
Did you make a New Year's resolution this year to improve your health and personal finances and already give up? If so, don't despair. There is a better way to change...take the time to prepare properly. Lay all your obstacles out on the table and try to overcome them, set a realistic start date (e.g., automatic investing in a 401(k) retirement savings plan) or quit date (e.g., smoking), and then "just do it" (take action). Notice that the "just do it" part is listed last. That is because, Nike marketing slogan aside, these words alone are usually not enough to motivate people to change, unless they are already about to do so and just need a little pep talk.
Change never begins with action. Rather, it requires awareness of a better way to live, a firm commitment to change, and a plan of action. So what's stopping you from making positive changes? List your obstacles. For example, if you've had difficulty starting an exercise program, what is holding you back? Is it long work hours, an extreme commute, difficulty finding 30 minutes of free time, weather, lack of social support, or uncertainty about what exercises are best? Part of the process of preparing to change is to reappraise the situation. Try to find at least one realistic solution for each obstacle. The same reappraisal process can be done with your personal finances. For example, what are your barriers to saving? Is it a high debt load, lack of automatic savings opportunities, overspending, or uncertainty about where to put your money?Some good ways to overcome the latter obstacle might be to attend a company employee benefit seminar or request written information about savings plan options. According to the book Changing For Good, "Setting a time frame is critical for behavior change. Choosing a date to begin can help prevent both premature action and prolonged procrastination." The authors advise "If you are truly ready for action, choose a date within the next month to capitalize on your decision-making momentum." If you continue to delay a change, it is a sign that you are in the contemplation stage (i.e., just thinking about taking action) rather than the preparation stage (i.e., developing a firm, detailed plan of action).
Changing For Good also advises self-changers to go public with their commitment to change. In other words, tell others about your plans. This increases accountability because others are "looking over your shoulder." Fear of the embarrassment of failing can be a powerful motivator to stay on track. In addition, by sharing their plans to change, self-changers may be able to enlist the support of family and friends who might otherwise undermine their efforts. It is not too late to develop a plan to improve your life in 2008 and take action to implement it.
For additional personal finance information from Rutgers Cooperative Extension, visit our Money and Investing website and Investing for Your Future basic investing home study course at http://www.investing.rutgers.edu/. The latter is a nationally recognized 11-unit publication with dozens of worksheets and suggested action steps at the end of each section. For information on health finance topics, visit our Financial Aspects of Health and Small Steps to Health and WealthTM websites. You can also order a copy of the Small Steps to Health and WealthTM workbook through the publisher at http://www.nraes.org/. The bottom line is that, when there is a will to change, there is a way.
Remember, "where attention goes, energy flows, and results show." Stated another way, what you think about, you bring about. Today can be a day of new beginnings to improve your health and increase your wealth. Best wishes for success.
