I just got back from the grocery store. My goodness, Downy Softner is 9 bucks now. Here are some tips on how to save money on groceries.
Times are tough lately and you are for sure not saving at the gas pumps. To make it, it’s important to find ways to cut back on money. Here are 5 ways to cut your auto insurance bill.
First-time homebuyers should begin planning now to take advantage of a new tax credit included in the recently enacted Housing and Economic Recovery Act of 2008.
Available for a limited time only, the credit:
However, the credit operates much like an interest-free loan, because it must be repaid over a 15-year period. So, for example, an eligible taxpayer who buys a home today and properly claims the maximum available credit of $7,500 on his or her 2008 federal income tax return must begin repaying the credit by including one-fifteenth of this amount, or $500, as an additional tax on his or her 2010 return.
Eligible taxpayers will claim the credit on new IRS Form 5405. This form, along with further instructions on claiming the first-time homebuyer credit, will be included in 2008 tax forms and instructions and be available later this year on IRS.gov, the IRS Web site.
If you bought a home recently, or are considering buying one, the following questions and answers may help you determine whether you qualify for the credit.
From aipb.org., here is a story about a successful freelancer.
Armelta Briggs, Consulting and Design, West Palm Beach, FL, has figured out a way to do only the work she likes, grow her practice-and have as much time as she likes to travel with her husband on his business trips.
Five years ago, she quit her full-time bookkeeping job to freelance and travel with her husband. Through a friend, she landed an assignment at a church showing employees how to use new software. Her work so impressed the church’s CPA, he started referring clients and her freelance practice was underway.
Despite Briggs’ decision not to advertise, market or attend business meetings, but to rely only on referrals, she doubled her last salary within 5 years.
“I get two kinds of referrals,” she explains, “big companies whose books are a mess and small businesses getting big enough to need bookkeeping.” For cleaning up the books, she charges $50-$70/hour, 2½ times the going rate for bookkeepers in her area; for routine work, her rate of $30/hour.
“Cleaning up problem books is my niche, and it’s what I enjoy most” she says. “I can do it without being given any direction, learn the software if needed and train the next bookkeeper on it. Software comes easily to me.”
Once the books are on track, Briggs spends 5-8 hours a week making sure they stay that way, then drops to once a month to check them. She says it averages $300/month per client, but can run over $1,000 if it includes daily data entry.
Briggs hates, and has avoided doing, data entry. Yet that is what small, growing businesses-and most of her referrals-need. So she hired a part-timer whom she pays $20/hour for data entry and charges the client $30. Once a month, Briggs reviews the books, does the bank rec, and checks the monthly financial statements.
Now that her business is growing without her having to do work she hates, she is starting to advertise, market and attend meetings where she can meet prospects-and she travels with her husband throughout the year.
The last of the economic stimulus checks have been issued under the planned payment schedule, which was a timetable for tax returns that were filed and processed before April 15.
However, the Internal Revenue Service will continue processing tax returns and issuing economic stimulus payments for much of the year.
It is not too late to file a return to claim an economic stimulus payment. The IRS urges people to file by October 15 to ensure they receive a payment prior to year’s end. It can take up to eight weeks for the IRS to process the return and issue the payment.
For people who have no tax liability or no tax filing requirement, there is a minimum payment of $300 ($600 for married couples), plus the $300 for each qualifying child. To be eligible for the minimum payment, individuals must have at least $3,000 in qualifying income.
Qualifying income includes any combination of earned income, nontaxable combat pay and certain benefit payments from Social Security, Veterans Affairs and Railroad Retirement. The IRS is continuing to work with numerous state, local and national partners to reach people who have no tax liability or no tax filing requirement and to help them file a simple Form 1040A.
Below are some links to IRS.gov and the U.S. Treasury regarding economic stimulus payments:
Also visit www.treas.gov to see the Treasury News Release Cumulative Economic Payment Totals.
Remember that for the genuine IRS Web site be sure to use .gov. Don’t be confused by internet sites that end in .com, .net, .org or other designations instead of .gov. The address of the official IRS governmental Web site is www.irs.gov
Links:
The Internal Revenue Service is providing tax relief to victims of Hurricane Gustav in affected areas of Louisiana.
The IRS is postponing until Jan. 5, 2009 deadlines for taxpayers who reside or have a business in the disaster area. The postponement applies to return filing, tax payment and other time-sensitive acts otherwise due between Sept. 1, 2008 and Jan. 5, 2009. This includes:
“As residents of Louisiana return to their homes following Hurricane Gustav, taxes are one thing they won’t need to worry about,” IRS Commissioner Doug Shulman said. “This relief gives them extra time to get their lives in order before having to deal with their tax matters.”
In addition, the IRS will waive the failure to deposit penalties for employment and excise deposits due on or after Sept. 1, 2008 and on or before Sept. 16, 2008 as long as the deposits are made by Sept. 16, 2008.
Other provisions are listed in the Grant of Relief section below.
Taxpayers who reside in or have a business located in the following parishes qualify for the relief announced today: Acadia, Allen, Ascension, Assumption, Avoyelles, Beauregard, Cameron, East Baton Rouge, East Feliciana, Evangeline, Iberia, Iberville, Jefferson, Jefferson Davis, Lafayette, Lafourche, Livingston, Orleans, Plaquemines, Pointe Coupee, Rapides, Sabine, St. Bernard, St. Charles, St. James, St. John the Baptist, St. Landry, St. Martin, St. Mary, Terrebonne, Vermilion, Vernon, West Baton Rouge and West Feliciana.
IRS computer systems automatically identify taxpayers located in the covered disaster area and apply automatic filing and payment relief. Affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 1-866-562-5227 to request tax relief.
If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing or payment due date between Sept. 1, 2008 and Jan. 5, 2009.
There is now tax relief for struggling homeowners. If your mortgage debt is partly or entirely forgiven during 2007, 2008 or 2009 you may be able to claim special tax relief by filling out Form 982 and attaching it to your federal income tax return for that year.
Normally, debt forgiveness results in taxable income. But under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude from tax up to $2 million of debt forgiven on your principal residence. The limit is $1 million for a married person filing a separate return.
Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, may qualify for this relief. The debt must have been used to buy, build or substantially improve your principal residence and must have been secured by that residence. Debt used to refinance qualifying debt is also eligible for the exclusion, but only up to the amount of the old mortgage principal, just before the refinancing.
Debt forgiven on second homes, rental property, business property, credit cards or car loans does not qualify for the new tax-relief provision. In some cases, however, other kinds of tax relief, based on insolvency, for example, may be available. See Form 982 for details.
If your debt is reduced or eliminated you will receive a year-end statement (Form 1099-C) from your lender. By law, this form must show the amount of debt forgiven and the fair market value of any property given up through foreclosure.
The IRS urges borrowers to check the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect. You should pay particular attention to the amount of debt forgiven (Box 2) and the value listed for your home (Box 7).
For more information about the Mortgage Forgiveness Debt Relief Act of 2007, visit the IRS Web site at IRS.gov. A good resource is IRS Publication 4681, Canceled Debts, Foreclosures, Repossessions and Abandonments. This publication and Form 982 can be downloaded from IRS.gov or by calling 800-TAX-FORM (800-829-3676).
Remember that for the genuine IRS Web site be sure to use .gov. Don’t be confused by internet sites that end in .com, .net, .org or other designations instead of .gov. The address of the official IRS governmental Web site is www.irs.gov.
Links:
1. Withhold FICA on part-timers (and retirees). Even if someone who works for you part-time also has a full-time job where they have had 100% of their FICA withheld for the year, you must withhold the full amount of FICA from their pay. These individuals can obtain a refund of any overpaid FICA on their 1040. Similarly, if a retiree receiving Social Security benefits works for you, say, one day a week, you must withhold FICA.
2. Former employees who return as “independent contractors” are probably employees. If they do the same job they did before they left, especially in the same tax year, they are employees. IRS target: Individuals who receive a W-2 and 1099 from the same employer for the same year.
3. Length of employment does not determine worker status. Even employees who work for only part of one day are still employees, and all employment taxes apply.
4. Giving part-timers benefits is optional. Generally, you do not have to pay part-time or summer help for holidays and need not include temps and part-timers in health, pension and other benefits. But to exclude them, have a written plan stating which benefits are not available to these workers.
5. Defining “part-time” v. “full-time” employees. Federal law requires that you pay the overtime rate for each hour worked over 40 hours in the workweek, and governs the number of hours that children can work. But company policy determines whether you will pay overtime after 30 or 35 hours or any other number of hours fewer than 40.
Important: It’s also a good idea to see if your state may have special laws.
In a tax emergency, would you be ready? Well–organized records not only help you prepare your tax return, but they also help you answer questions if your return is selected for examination or prepare a response if you are billed for additional tax.
Fortunately, you don’t have to keep all tax records around forever. Normally, tax records should be kept for three years, but some documents — such as records relating to a home purchase or sale, stock transactions, IRA and business or rental property — should be kept longer.
If you are an employer, you must keep all your employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later.
If you are in business, there is no particular method of bookkeeping you must use. However, you must clearly and accurately show your gross income and expenses. The records should substantiate both your income and expenses.
Publication 552, Recordkeeping for Individuals, provides more detailed information on individual record keeping requirements.
Publication 583, Starting a Business and Keeping Records, and Publication 463, Travel, Entertainment, Gift, and Car Expenses, provide additional information on required documentation for taxpayers with business expenses.
These publications can be downloaded from IRS.gov or ordered by calling 800-TAX-FORM (800-829-3676).
Actually, there is a wealth of free tax information on the IRS Web site, IRS.gov. It’s not just about recordkeeping. Individuals and businesses can find answers to almost any question about federal taxes on the web site. Helpful links found at the top of the home page will take you directly to topics centered on Individuals, Businesses, Charities and Non-Profits, Government Entities, Tax Professionals, the Retirement Plan Community and Tax Exempt Bonds.
In addition to the latest news coming from the IRS, the homepage can lead you to statistics, news releases and tax tips, local IRS offices, the Taxpayer Advocate Service, and thousands of IRS forms and publications. Frequently asked questions and answers are available or you can use two separate search icons: one by keyword and one by answering “I need to . . .”
Why wait? Summertime is a great time to visit IRS.gov.
Remember that for the genuine IRS Web site be sure to use .gov. Don’t be confused by internet sites that end in .com, .net, .org or other designations instead of .gov. The address of the official IRS governmental Web site is www.irs.gov.
Links:
1. Apply all withholding taxes to vacation pay.
2. You can accrue paid vacation differently by the job, because it is a matter of company policy, not federal law. For example, give managers two days’ paid vacation for each month worked, a clerk one or no days. Or, base paid vacation on salary, years worked or a mix of standards. But the policy should be in writing, made known to employees and applied consistently.
3. You need not include paid vacation days in overtime calculations. For example, if an employee works 40 hours, Monday-Thursday and takes a paid vacation day on Friday, you need not include the paid Friday hours when determining whether the employee is entitled to overtime pay.
4. If vacation pay is included in a normal paycheck, withhold for the entire check over a longer period. For example, if you pay weekly and include one week’s paid vacation, withhold for a two-week period.
5. You must pay earned or accrued vacation if the employee quits. Have a written policy that clearly states who is or is not entitled to accrued vacation pay at termination.
Reminder: Employees may be entitled to unused vacation pay under ERISA (covers early retirement) if there is a written policy or a pattern or practice of paying unused accrued vacation to such employees.
Important: These are the rules under federal law. Where appropriate, also check your state laws.