Hints That Could Trigger a Tax Audit

Messing around with the IRS could cost you big time and the last thing you want to deal with is a tax audit. One of the main functions of the IRS is to pinpoint those individuals that might be evading tax payments. There are a lot of people out there that are dishonest about the money they make and the tax credits and deductions they apply for. For this reason, the IRS has to do continuous research and referencing of those taxpayers that stand out in their systems. If you come up on their radar, you can most likely expect to receive a letter from them in the mail requesting further information. Phones calls or emails received from the IRS are probably scams, so it would be wise to ignore those types of inquiries altogether. If you can work around these audit-prompting signs, you can expect to stay in the clear with the big wigs over at the IRS.

If you made a whole lot more money this year than you did last year, you might be sending up red flags that will make the IRS interested in performing a tax audit. Big changes in income for taxpayers might give off the scent that you’re not honestly reporting your income. The IRS has a system for keeping an eye on data that relies on history and if you start reporting a smaller income out of the blue, you might be put on the spot for a tax audit.

Tax Audit

When you forget or don’t file certain paperwork, the IRS will get wind of it. It’s an employer’s duty to send copies of both the W-2 and 1099 forms over to the IRS and you. If you happen to lose or neglect to file those important papers, the IRS might feel moved to mark your tax return for review. Before you go through with filing, you want to thoroughly review all paperwork that you receive from your employer for errors or miscalculations. You want the IRS to have the most correct information so that there’s no question or need for a tax audit.

If you happen to be self-employed, the IRS is probably eyeing you very closely to make sure you’re not underreporting your earnings. If you’ve got a home office and you’ve claimed deductions for certain costs related to it, you better make sure you’re being honest about what you earn. The IRS might want to run a tax audit on you if your income seems to be lower than it should be for the type of home office setup you’ve got going. It’s up to you to keep everything well documented so there’s no questions about your income or the taxes you owe.

Although there are a lot of people with actual legitimate home office expenses, there are still others that want to get in on the benefits without doing any work at home. Checking your work email from home does not transform a space into a home office. A legitimate home office set up is only used for work on a regular basis. As always, it’s going to be up to you to prove that all of the expenses you list are clearly organized and backed with proof documents to satisfy the IRS. They’ve also got their eyes open for specific business expenses like dinners and entertainment costs. You can be sure that they don’t want people getting away with expensive meals for nothing.

You should make sure to be careful about writing off hobbies. If you like to make jewelry in your spare time but you don’t have a business out of it, it should be obvious that you can’t write off the expenses of beads or tools. If you don’t stand to make money from it, you can’t claim it as a deduction on your taxes.

The IRS always has its eyes peeled for those taxpayers that seem especially generous when it comes to charitable donations. A lot of times, taxpayers will embellish the amounts that they’ve given to charities to get more back later. If you make any charitable donations, it’s of the utmost importance that you hold on to the receipts so you can quickly answer any questions that arise from the IRS.

If you’ve got an offshore bank account, you can bet that the IRS is going to be even more interested in the taxes you pay. If you’ve got foreign accounts, the IRS has introduced more rigid conditions that you’ll have to adhere to. Not reporting necessary information is the quickest way to start a tax audit.

When the numbers on your forms don’t add up, the IRS is definitely going to have some questions to ask. They’ll be quick to look into any discrepancies they see, so you want to be thorough and final once you go to turn your documentation in to avoid a tax audit or other annoying circumstances.

How to Use Debt Consolidation for Financial Stability

It is amazing just how much being a debt can affect your ability to do normal tasks that would otherwise be easier if you were not burdened by debt. Purchasing a new car is difficult when you have bad debt. Finding a new home or an apartment to rent is difficult as well. Even matters such as finding a great paying job or applying for any type of loan may be difficult when your debt is too big. There are many individuals who are currently suffering from being in large debt, and thankfully there are many financial programs that can help individuals climb up out of debt and into financial stability. One of those programs is debt consolidation. Debt consolidation for financial stability is one of the commonly suggested ways to get help solve debt issues. Continue reading for more information on debt consolidation for financial stability.


What is Debt Consolidation?

If you are an individual who is dealing with a variety of debt that has been accumulated over the years by a number of different creditors, then debt consolidation for financial stability is the best route for you to take. Debt consolidation occurs when a company agrees to take all of your debt and combine it into a large lump sum that will require just one payment. Debt consolidation for financial stability allows you to just be responsible for handling one debt payment each month. The company in charge of your debt consolidation account will help you to pay your creditors by taking your monthly payment and disbursing it properly to accommodate all of the creditors involved in the lump sum payment.

Types of Debt Consolidation Solutions

Because debts can involve a variety of different accounts, there are different methods of debt consolidation that companies may offer for financial stability. You may have a variety of different student loans on your credit or you may be drowning in loads of credit card debt. You may need to consolidate a number of different loans ranging from car loans to personal loans. Debt consolidation for financial stability can come in a variety of forms including transferring all credit card debt onto a single credit card, securing a loan to take care of all of your debt, or just making one monthly payment to satisfy your debt consolidation agreement. Any method used will provide you with a lower interest rate for your payments, a more manageable monthly payment, and less of a headache from dealing with your creditors.

Benefits of Debt Consolidation for Financial Stability

There are many benefits to using debt consolidation for financial stability. Those benefits include but are not limited to:

  • The creation of an organized system to taking care of debt. Keeping up with the creditors that you owe and how much you owe them could present you with a difficult task especially with debt that had started years ago. Using debt consolidation for financial stability provides you with that extra help to keep all of your debts organized and easier to manage.
  • The creation of better financial habits. Using a debt consolidation company may force you to get rid of open credit cards and from taking on any new debts. Using debt consolidation can also teach you better ways to manage your money because some debt consolidation companies require that you take a debt counseling course.
  • The creation of better finances. Acquiring loads of debt could have you drowning in high interest rates and high monthly payments on a variety of different accounts. Debt consolidation for financial stability can help you to better your finances with the assistance of a middle man. Debt consolidation will give you one bill that must be paid each month, and the debt consolidation company will do its part to make sure that your creditors are being paid the right amount at the right time. Typically, low interest rates are given with debt consolidation, and each payment that is made on time can result in a positive impact on your credit score.
  • You will feel better about your finances. Now that you have a solution to your debt issues and are making steps towards paying your creditors, you can be relieved of some financial stress. You can acquire the tools needed to keep you on the right track financially and learn new ways to manage your money so that you will not find yourself dealing with those debts again.

You should be aware that debt consolidation for financial stability is not an effective method of getting rid of debt for everyone. There are some individuals with more serious debt issue that may need more than just debt consolidation, and there are some individuals who may be considering the program without really needing it.

Filing Bankruptcy for a Business Organization

The United States legislation regarding bankruptcy (the U.S. Bankruptcy Code) holds the procedures for reorganizing and restructuring debt, both for individuals and businesses.  Chapter 11 of this Code outlines the means of filing bankruptcy for a business organization, when the business wants to continue operation in order to obtain a safer financial status when the proceedings of the bankruptcy case are over.  The debtor (or business) works closely with the court trustee and the two create a plan to essentially rebuild the business’s operations and structure, as well as clarifying and reworking debts to be able to pay off anything left owed to creditors.  The trustee works closely with the proceedings for bankruptcy for a business organization, and makes sure the day-to-day process goes smoothly.


How to File Bankruptcy as a Business

At the bankruptcy court, you need to find the clerk and ask for a “Chapter 11 petition form.”  This is one of many forms used by these clerks to help consumers and businesses begin their bankruptcy proceedings if they have no legal representation.  The form includes instruction on how to begin your bankruptcy for a business organization.

  • After getting the form, follow the instructions exactly. This will include providing lots of information about your business, including assets, debts, expenses, incomes (your tax forms will help) and how your business can complete a repayment plan.  Make the plan clear!
  • Once you’ve completed the form totally, bring it back to the clerk at the bankruptcy clerk for filing.
  • When you file the petition, you’ll need to pay a filing fee. Various courts require various fees, depending on your district or other jurisdiction area.  The clerk will clarify the specific fees for bankruptcy for a business organization.

These Chapter 11 cases tend to be much more complicated than other bankruptcy proceedings, and as such an experienced attorney is critical if you want to preserve your business’s interests.  Bar associations are services that maintain directories of legal aid (especially attorneys) specialized in whatever area you need (in this case, bankruptcy for a business organization).  You can find out more information about your nearest bar association at the website for the American Bar Association, or at their offices:

American Bar Association

321 N Clark St.

Chicago, IL 60654-7598

Know Before You File

If you file a Chapter 11 bankruptcy for a business organization, it is required that you create a reorganization plan for your business’s operations as well as a plan that guarantees restructuring your debt.  When you submit this important plan to the bankruptcy court trustee you will be working with, he will check it and if you’ve done it correctly, approve it.

Chapter 11 vs. Other Bankruptcy Plans

Chapter 11 bankruptcies, the ones we’ve been discussing, allow the business filing to remain open.  While the court proceedings are under way, the daily operations of the business remain unchanged and are controlled by the management of the business but the bankruptcy court handling the proceedings will need to approve any major decisions made by the business, to ensure that the plan to pay off debt, restructure, and reorganize will be met accordingly.  During the reorganization, a stay to protect all company assets is issued; some debts may be renegotiated and the company’s structure in managements and corporate strategy may be very largely changed, in order to ensure that the court’s plan is met.  Small enterprises can file bankruptcy for a business organization under Chapter 11 under the title of “small business” if it continues to actively operate its company and as long as its debt does not exceed $2,343,300.  This way, a Chapter 11 filing will help small businesses keep assets while the debt is worked out.

Chapter 7 bankruptcies are much different.  They require the liquidation of any and all assets that the filing business may have, because this type of debt usually entails a very small chance of the business regrouping and continuing everyday operations.  This type of filing also uses a trustee; however, the trustee will oversee the liquidation of assets, paying of fees and distribution of balance to creditors much more closely than in Chapter 11 as well as having much more power in the company’s management.  When a business files Chapter 7, there is little to no way to protect assets.

Chapter 13 also puts a stay on the business’s assets to protect them from creditors, and is typically used by an individual or an individual in sole proprietorship of a company.  As of 2012, the limit to file Chapter 13 was $360,475 for unsecured debt.  For secured debt, the limit rose to $1,081,400.  With this filing, a plan to continue creditor payment is formulated (usually completed in between three and five years, but that can vary greatly case to case).  Depending on your debt, this plan may allow you to remain in business with your assets.

A Final Word on Transfers

Your attorney will always know best!  Follow his or her advice on the transfer or sale of your business’s assets, because some transfers (especially if done just before you file bankruptcy) could be seen by a judge as fraudulent.  These include moving all your large assets, removing, or worse, concealing assets, and transferring immediately before a lawsuit.  Should a transfer be reversed by a court, these assets could become available to your creditors.  Listen to your attorney.

Choosing the Best Cloud Storage Provider for Your Needs

Cloud storage service seems to be on the rise in a big way. It’s becoming the norm for big companies to save their data remotely online rather than taking up room in house to store a data farm. Deciding to use a cloud storage service to store your information has quite a few upsides. You won’t ever have to worry about losing your precious information since cloud services make all data recoverable from a remote location. Another big plus that comes with cloud storage is the price. Most services are very affordable and you won’t be hard pressed to find a plan that offers unlimited storage if you need it. If you’re in the market for cloud storage, here are a few key points that you want to consider.


Cloud Storage Space vs. Cost

The price of a cloud service is usually only a concern for people looking for a storage option that covers their home data needs. In most cases, the $10 to $20 it might cost to provide cloud storage for a business is a very cheap expense. An unlimited cloud service plan might start at $5 and run up to $20 depending on the provider. You should weigh your options and make sure the plan that you go with can meet your data storage needs while also meeting your target price. There’s so many options out there to choose from, so it shouldn’t be too difficult to find one that serves you well.

Bells and Whistles

Depending on which provider you go with, you might have quite a list of features that go along with your service plan. Automatic file backups, drag and drop, file and folder sharing and file restoration might be a few of the perks available to you. Of course you don’t want to pay for things you don’t need, but there will most likely come a time when you’ll need all of the features one time or another. You should swing for the plan that offers the most features for the least amount of money.

Upgrading your plan at any time is usually a possibility, so you don’t have to worry about needing more storage or features in the future.

Points of Access

Most cloud servers can be accessed from a laptop or PC but now even more than ever there are mobile clients popping up that make it easy to access your information while you’re on the go. You want to make sure your provider has a useful mobile application if that’s of importance for you. This will make it simple for you to input quick changes to your database as you need to whenever you don’t have your computer around.

The more points of access you can get from your provider, the better off you’ll be.

A Secure Process

For a lot of users, security is one of the most important aspects of using a cloud storage server. You want to be sure that anything you store there will be safe. Your provider should allow a secure way to sync files to your account and all of your data should be encrypted. You want to go with the provider with an up-to-date, legitimate SSL certificate. If they have additional encryption methods, that’s all the better. With the internet becoming an even more booming place, you wouldn’t want your information to get into the wrong hands, especially if it’s important or classified. Go the extra mile and make sure your information is properly stored away.

Great Customer Service & Support

As with anything, you could run into problems when using your new cloud storage interface. This means that you need a helpful technical support team to come to your rescue while you’re navigating the framework. Even if you have other questions that go beyond using the program, you want to be sure that you have someone to call that will help out. You should seriously consider the kind of technical support your provider has built into their system: you’ll never know when you have to call them up for some assistance!

Finding the right cloud storage server should be an easy thing to do. With all of the competition out there, you should find a great deal on the perfect plan for you. It might take some thorough research, but the storage option you need is waiting to be had. Some of the big names might tickle your fancy, but there’s probably smaller companies out there with amazing deals that are just looking to grow their client base. Don’t take the first opportunity you get to sign up with a cloud storage provider. Do a few limited-time trials first to get familiar with the infrastructure of different systems. Go with the company and database that best serves you and your needs. Getting exactly what you need in a cloud server is much easier than you think!

So you’re A Victim of Identity Theft and Someone Bought a Car in Your Name

The National Insurance Crime Bureau (NICB) has recently been warning Americans that identity thieves are using those stolen identities to buy or lease new vehicles, drive them away, and disappear without making a single payment. Frank Scafidi, the spokesman for the NICB, says that often the cars are exported to other countries. If you’re an identity theft victim and your identity thief purchased a vehicle in your name, the steps you must take is very similar to any other identity theft. Once you are able to prove that the vehicle is not yours and you have not purchased it, the banks will refund your money and recoup the car if it’s found somewhere. This crime has become so popular that it has caught the attention of the NICB and the FBI. In May, three men were caught in an international auto theft ring. The three of them used stolen credit card numbers and stolen identities to purchase 44 vehicles and ship them to Ghana. The cars were worth over $500,000. They had bought the stolen credit card numbers and the corresponding driver’s licenses online. They stocked up on Toyotas and Mercedes, drove them to New Jersey, shipped them to Ghana, and sold them there. Eventually the dealership became suspicious about the excessive purchasing and contacted the FBI. This ended the scam.


It’s Fraud, Not Auto Theft

It’s impossible to say how many similar cases of identity theft and vehicle purchasing has occurred in the United States since 2010 because many people make the mistake to classify them as financial fraud instead of auto theft. This makes it difficult to count the exact number of cases because the FBI tracks the annual auto thefts under its Uniform Crime Reporting Program. Many people don’t even know that their identity was stolen until the bank that financed these vehicles notices that no payments are made on the loans. These financial institutions often seek the help of law enforcement, or if they try to repossess the vehicle, and obviously can’t find them, they will often contact the NICB. If you are an innocent victim that has had both your credit card number and your identity stolen, you will have to deal with a lot of lack of trust before you can clear your name. Identity theft is known specifically to be a real hassle trying to get to straighten out. Despite all the hassle and headaches, you won’t get a black mark on your auto insurance record from failing to cover a car you never owned after you finally become able to prove that you were a victim of an identity theft scam. Reputable auto dealers never let someone purchase a car without proving they have insurance coverage.

It’s Your Identity That’s Wrecked

Sadly, when you find that a car has been bought under your name, it is entirely up to you to clean up the mess and prove that you have had your identity stolen. It is always the victim’s responsibility to prove that it wasn’t their fault. If you ever receive an unexpected call from any finance company or car dealership asking about a vehicle that you haven’t made any payments on, you should first request a copy of your credit report to make sure that there are no unauthorized charges. If there are, the next step required is for you to file a police report, you’ll have to have many meetings with different people including the three main credit reporting agencies, your auto insurance company, the auto dealership, and your state’s department of motor vehicles. Identity theft can be a sticky situation. It really impacts your finances, and just hope that you don’t need to buy a new car before the situation is handled. Until the identity theft issue is resolved, the extra vehicle listed in your name can really impact your debt to income ratio and make it look like you’ve missed making all of your previous car payments. Identity thieves are very clever and skilled at making very convincing documents. Most of the time, identity thieves will use your stolen information to run up a few hundred to a few thousand dollars in credit card charges rather than trying to steal vehicles that can cost up to tens of thousands of dollars. Buying a vehicle in someone else’s name is a new and more effective may for thieves to monetize their data.

Identity theft is a giant problem in the world because it is so hard to get rid of. It can be very difficult for a victim of identity theft to prove that they are not lying. Now identity theft is becoming a greater problem because identity thieves are finding new and more efficient ways to steal. In the past, identity thieves would steal only a few thousand dollars before they were discovered and now they can steal tens of thousands of dollars’ worth in cars.

Choosing the Right Dental Insurance in Four Steps

It’s kind of a given that dental insurance will cost you less over time in premiums than health insurance, but like everything else, there’s always a catch. You’ll find that most health insurance plans will cover a nice chunk of your expenses once the deductible has been paid off, but dental insurance policies work a little bit differently. With dental, there’s an annual limit to how much you’ll see in coverage a year and it’s usually between $1,000 or $1,500 with a $50 to $100 deductible. Sure, your plan might cover 80% or more on your cleanings, exams or x-rays but when it comes to crowns, extractions or heavy-duty treatments, you might only be assisted with 50% of the cost when you use an in-network dentist. Other dental procedures like cosmetic work or orthodontic visits are not covered at all.


With most people struggling to make ends meet outside of the realm of personal health, it makes sense that even those with dental insurance will try to put off important procedures because they simply don’t have the money to shell out for them. Whether your insurance doesn’t cover a dental procedure you need done or you’ve used up your maximum coverage for the year, it can be a headache trying to figure out what to do next. If you want to sidestep more of those unforeseen charges, follow these steps when you’re trying to make sure you’re choosing dental insurance that best suits your lifestyle.

Is Group Coverage an Option?

Depending on where you work, your employer might provide you dental insurance through your employer. Choosing dental insurance through a group coverage program could save you big money. You’ll find that these kinds of plans are less expensive and they generally provide better benefits than individual insurance plans. Before you commit to choosing dental insurance provided by your employer, you want to be sure that you’ve thoroughly looked through all the details of costs and premiums you are to incur. You only want to go with this option if it’s better than other options you’ve seen.

Check Out Some Individual Policies

Individual dental policies tend to be more expensive and less beneficial than a group policy plan and there are often times waiting periods before you can have a major procedure done. You can be sure that signing up in the knick of time because you need something done will most likely result in a waiting period of up to a year. When choosing dental insurance, you want to make sure that you weigh all of your options before deciding on one type over another.

Get Familiar with the Dentists in Your Network

If you have an indemnity dental plan, you’ll be able to use whichever dentist you wish. PPO and HMO plans are more common though, and these plans limit you to dentists within their networks. If there’s a particular dentist you really like, speak with them directly to find out which insurance they accept. If it’s fine by you to find another dentist, choosing dental insurance in the PPO or HMO bracket might work best for you. If you do go with a new dentist, you should be on high alert if they try to tell you that you need a lot of unexpected work done. There are some in-network dentists that might try and recommend unnecessary procedures to you to make up for losses they incur on preventative services; they’re reimbursed by dental insurers at low rates for these services. Ask friends or colleagues if they know of any good local dentists and then cross-reference your findings with what the insurance plans and providers accept.

Find out What’s Covered Up Front

If you want to be able to budget well for the dental expenses that will without a doubt come into play, you want to know your policy coverage limits forwards and backwards before scheduling an appointment. If you went with the AARP Delta plan for example, you would be able to get cleanings, oral surgery, restorations, denture repair and root canals as soon as your insurance began. You wouldn’t be able to get gum disease treatments, dentures, dental implants or crown or cast restoration until your second year of coverage began. And still at that, your benefit is only 50% of the costs. This means that if you or another family member needs some serious work done, you’ll probably be looking at paying a good amount of that out of your own pocket. There are upsides and downsides to both group and individual plans and no matter which one you go with, you’ll be expected to pay something on your own for those major procedures.

Choosing dental insurance will be about doing the research to make sure you’ve decided on the best option for you. Make sure you know all of the key points when choosing dental insurance!

How Do I Know If I Can Get A Debt Consolidation Loan?

If we’re all completely honest, financial matters are never easy to discuss or think about and many of us are left scratching our heads with confusion. It can seem over complicated or too much to take in. Many of us want thinks neatly and easily spelled out – especially when it comes to matters like debt. If you’ve had money problems over the years you might have considered lots of different options and not all of them might have been particularly good or helpful.

A debt consolidation loan is one of the more well-known ways of trying to clear financial problems, but they’re not all as reliable or safe as they’re made out to be and it can be difficult to know who to trust. Here’s a helpful guide with everything you need to know about debt consolidation loans.

Debt Consolidation Loan Denied Stamp Shows Consolidated Loans Refused

Why Take On A Debt Consolidation Loan?

If you’re in a bad financial position and need to find a way to put all your money into one loan to pay off then this may work for you. Usually, they are at a lower interest rate which means you can then work to pay off the entire loan much quicker.

Each lender will have their own criteria for this type of loan, they may vary slightly but more often than not go as follows:

  • How High Is Your Credit Score?: You won’t need a perfect credit rating, but you will need to have one that is fairly high to qualify for a debt consolidation loan. Lenders will use this rating, whether “excellent”, “good” or “average” to assess how much of a risk you might be if they allow you to have a loan. It’s not an outright deciding factor, but it is important.
  • Your Credit History Matters: As well as your credit score, your credit history will need to be considered too. If you have a bad history in this department then it may go against you and your ability to get a debt consolidation It can give information about whether or not you’ve ever defaulted on a loan before or had trouble making payments.
  • Your Income: Your income at the present moment will have a bearing on whether or not you can have a debt consolidation loan. Your past history, your current home and how stable your income has been will all need to be looked at. If a lender requests it, be prepared to share with them your accounts.
  • How Quickly Can You Repay? Your loan will need to be repaid fully and in good time. You’ll need to be able to work out a workable way of paying it all back in a certain timeframe and try to stick to it. If you know you’re going to be in trouble with keeping up repayments you need to speak to your lender as soon as you are aware of this and work out either a new scheme or try to find another way through.
  • How Much Do You Need To Consolidate? Many lenders will have a minimum and maximum threshold for debts. You must make sure you fall within these – otherwise you may not be able to get a consolidation at all. Consider this before you go ahead.

What Will Your Loan “Look” Like?

If you’ve qualified, based on all these factors then you’ll have a loan mapped out for you that should make things easier for you to understand. You’ll have one figure to stick to each month and you’ll simply keep going until all the money is paid back.

Not everyone will easily qualify and it’s also important to point out that you must do your research thoroughly before you commit. There are many decent lenders out there who will genuinely want to help, but there are also others who will try and push up higher interest rates or not have you best interests at heart.

If, when you’re looking for a company, something rings alarm bells then do not commit and do not get a loan from them. It pays to look at customer reviews and take on board other people’s feedback from the services they’ve used. You need a company with a registered address and a customer service line you can call whenever you need help and support.

Whilst this kind of loan is good for many, it isn’t always the final way forward. If you’re facing financial hardship it can be better to explore every other option before you commit to something like this. However, for many they are the only answer and can provide a way out of a situation that was otherwise thought untenable. It can sometimes be better to put your trust in a system like this and reach out for help than it can be to suffer in silence.

The New IRA and 401k in 2015

Guess what everyone? The year 2015 will meet us with a variety of changes, including ones to the IRA and 401k plan. There is much excitement to be seen with the new IRA and 401k in 2015. The changes will be set in place in an effort to make retirement easier and much more enjoyable. Keep reading for more information on the new IRA and 401k in 2015.


The Current IRA and 401k

So, it may be a bit difficult to get excited about the new IRA and 401k in 2015 if you are not aware of what the IRA and 401k is really about. The IRA and 401k are both commonly used ways to save for retirement. When jobs offer retirement plans for individuals, employees usually decide on investing in the 401k or the IRA (individual retirement account). The main difference between the two retirement investments is that the 401k is given by your employer; an IRA is one that you set up through your bank, marketing firm, or another financial company. Below are more brief explanations comparing the two retirement savings options:

  • For every amount you put in your 401k, your employer matches it by a set percentage.
  • Money is taken from your paycheck, tax-free, and placed in your 401k account.
  • Taxes are only taken out when the money is withdrawn.
  • Depending on your age, there is a limit of money you can add to your 401k each year.
  • You can borrow money from the 401k if necessary.
  • You cannot access your full 401k until you are almost 60 years old.
  • Any money placed in the IRA has to be done by you. There is no one to match the money invested.
  • The IRA gives you more choices for investments, like stocks and bonds.
  • The money added to the IRA is not taxed until you make a withdrawal.
  • You cannot borrow money from the IRA.
  • There is a set limit of fund you can contribute yearly to your IRA.

You can research more information on 401k and IRAs, but with the introduction of the new IRA and 401k in 2015, you will soon find that the two has gotten much better.

Better than Before

With the new IRA and 401k in 2015, earning a hefty retirement savings will become much easier, making retiring more enjoyable for deserving individuals. Here are the changes you can look forward to.

·         A New Retirement Account

The myRA is a new account offered by the treasury department. All deposits made to the account will come from payroll. It will only take a minimum of $25 to start the account, and deposit of at least $5 should be made automatically per payday. The best part is that if you were to lose your job, you can transfer the account to your next job. Eligible participants must earn a yearly income of $129,000 or less for singles and $191,000 or less for couples.  Like the Roth IRA, the myRA account allows tax-free withdrawals at no specific time. Once the balance of the myRA account hits $15,000, the balance is moved to another account.

·         401k Increased Limits

With the new IRA and 401k in 2015, you will be able to add more money to your 401k. With the New Year will come the ability to contribute $18,000 limit to the account. This is a $500 increase from the previous year.

  • Roth IRA Income Cut-off Increase
    In 2014, the income cut-off for Roth IRAs was $114,000 for single people and $181,000 for couples. The new IRA and 401k in 2015 has increased the amount by $2,000.

·         Increased Saver’s Credit

Any individual in the low or average income bracket who is using the 401k or IRA are eligible for saver’s credit. This credit means that single individuals will get $1,000 and couples will receive $2,000 in tax credits. This is an increase of at least $500.

·         One Rollover for IRA

With the new IRA and 401k in 2015, investors will only be allowed to make a single rollover between IRAs throughout each year. If another rollover is done within the same year, the rollover will suffer an income tax charge, a 10% penalty for withdrawing early, and a 6% contribution tax. However, there are no extra fees for a transfer done between trustees more than once a year.

With retirement being a must for most individuals, it is important to start with savings funds early on in your employment. The government has set in place retirement funds to help you save up for retirement. The most popular being 401k and IRAs are taking on a new look for the upcoming year. The new IRA and 401k in 2015 is expecting to be more help for retiring individuals, making retirement easier and more settling financially.

Living a Successful Frugal Lifestyle

Making the change to a successful frugal lifestyle doesn’t happen overnight. If you’re the kind of person that’s accustomed to spending hard and fast, you’ll probably have to work hard and change all your bad habits to being living a successful frugal lifestyle. It’s important to know that being frugal doesn’t mean that you’re cheap, but it does mean that you know how to maximize your resources and you’ll tend to be less wasteful in general. Learning how to live a successful frugal lifestyle will most likely take a lot of tiring practice but if you’re up for a good challenge, you should be able to make it through the storm! Breaking the cycle of excessive consumerism will allow space and opportunity for one to breathe again without feeling like we’re making the wrong decision. Somewhere down the line, we got tricked into believing that bigger means better when it in fact means the opposite if you can’t afford to finance your habits and gadgets. You’re only hurting yourself by buying into the oppressive debt culture that’s been built around us!


What Does It Mean to Have a Successful Frugal Lifestyle?

What does it really mean to have a successful frugal lifestyle? In so many words, it means making intentional choices with your spending. Spending less to allow your limited income to stretch is of top priority, but this doesn’t mean that you’ll be spending less by being “cheap”. Being frugal illustrates how your own personal thought attaches to a purchase to decide whether or not it’s a good purchase for you to go through with. Deciding not to make those less important purchases will be a big part of the reason why you’re able to live a full and successful frugal lifestyle.

  • You only want to make wise decisions when it comes to your finances, and removing unnecessary expenses will not deprive you, especially when you’re putting your financial prosperity first. You must make room for the most important purchases and everything else becomes secondary.
  • Being frugal won’t stop you from living a nice life, but it will teach you that living beyond your means is dangerous. Someone living a successful frugal lifestyle can still plan to buy a home, but they’re most likely to remember that modesty is key, and there’s no reason to buy more house than you need to be satisfied.

Key Focuses of a Frugal Life

Most Americans today really need to get a grip on their terrible spending habits and the need for a more frugal lifestyle stems from that. No matter how much you earn or what kind of job you have, you’ll always find yourself in need of more if you never develop good spending habits. Living frugally doesn’t come easy in a world like ours so built on purchasing power and advertisement, but you can do away with your ignorant nature and make a fresh new start.

  • Learning how to manage your money well will be the first step to becoming someone with a successful frugal lifestyle. It might be hard to realize such a huge change all at once, and you can ease your way into the process. You might find that one of the reasons you’ve had a bad financial track record is because you’re financial management skills are just not up to par. Before you do anything else, you have to learn the tips and tricks of financial management that will get you on the right track. You want to avoid expenses that eat up the extent of your income and sitting down with your budget drawn up on paper will force you to be more realistic about the situation you face. Identify which of your priorities mean the most and leave the excess at the waist side. Financial management also encompasses smart spending as well as saving, so having a well-defined idea about all the aspects makes the most sense.
  • Reducing your debt will also make a successful frugal lifestyle that much easier to attain. Notice that there’s a difference between reducing and eliminating debt: and you don’t want to completely eliminate debts if you hope to keep your credit score in a higher state. Frugality frowns at wasted money and intense interest rates certainly qualify as wasted money. If any of your debts have very high interest rates, you’ll probably want to seek the help of a debt relief professional to get to the bottom of it.

Hold a yard sale, save your change and clip coupons to show commitment to a successful frugal lifestyle.

All Is Forgiven: Dealing with Student Loans

The headache of student loans: the main reason why students are able to attend college, and the main reason why students decide not to attend college. Student loans are a good thing to take care of college costs and expenses, but when it is time to pay the loans back, things can get a little difficult. If you are among the lucky group of college students who find good jobs straight out of college or who are able to afford student loan payments after graduation, then congratulations! You are able to do something that the majority of freshly graduated college students are not able to do. It is very important to find a way to have your student loans forgiven. Keep reading for more information on student loan forgiveness.

Young woman with a piggy bank and using a calculator

Ways to Student Loan Forgiveness

There are a few ways to either completely eliminate or decrease the amount of the student loans you have to repay. Some of the ways depend on what you graduate with and your job coming straight out of college. Here are the ways to have your student loans forgiven.

·         Participate In Volunteer Work.

There are a few volunteer programs that will allow you to lend your time to their organization in exchange for having your student loans forgiven. Some of the organizations that allow this are the Peace Corps and AmeriCorps. These programs forgive up to 70% of your student loans.

·         Work In The School System.

For graduates that used the Perkins Loan, working as a full-time educator in an area with low-income families could qualify you for having your loans forgiven. As your teaching years increase, so can the amount of your loans being forgiven.

·         Sign Up For The Military.

Having your student loans forgiven is one perk of being a part of the military. As of right now, the Navy, National Guards (both Army and Air Force), the Air Force, and the Army have programs that offer repayment of loans for up to $20,000.  Not all branches of the military offer such programs. If you decide to join the Marines, Coast Guards, or Air Force Reserves, you will not be offered any programs to help forgive your student loans.

·         Work as a Lawyer or a Doctor.

Working toward a medical or legal degree could rack up a lot in college costs because you are in school for quite a few years over the normal 4 to 5 year college attendance. Because of that, there are some ways to get your loans forgiven by being a medical or legal professional. Programs like the National Institute of Health, the National Health Service Corps Loan Repayment Program, and the Association of American Medical Colleges offer chances to have your student loans forgiven.

·         Wait 20 To 25 Years For Another Loan.

If you used a federal loan and are currently making payments based on your income, you may be eligible for forgiveness after 20 to 25 years but only if you work a job in public service. Typically, all federal loans are able to be forgiven, except the Parent PLUS loans and loans that are in default.

There are more ways to get your student loans forgiven.

Who is Responsible?

If you have been selected as an eligible candidate to have your student loans forgiven, someone still has to be responsible for repaying the loan. Here is where the taxpayers come into play. Whenever the government allows forgiveness for your student loans, taxpayers become responsible for paying the loans. So, you can look at it as the taxpayers having paid for your college education. This is almost similar to your education being funded by government grants. If you have student loans through a private lending organization, the banks other members would be responsible for repaying the loan if the bank deems your student loans forgiven. The amount is repaid by the bank’s members paying more in bank fees and interest.

Negative Impacts of Forgiveness

In some cases, when you have your student loans forgiven, you are required to report the forgiveness on your taxes as income that can be taxed. As a result, you may have an increased liability for the year, meaning that when you do file taxes eventually that year, you will receive a bill to pay. When filing taxes, inform your tax preparer that you have had your student loans forgiven, and ask their opinion. Having your particular student loans forgiven may not require that you have to pay a tax bill when you file your taxes.

Student loans can be a relief when going through college, but an immediate pain when it is time to pay them back. You may find yourself unable to repay the loan or keep up with payments. Luckily, the government offers student loan forgiveness that could help you avoid getting into too much debt with your student loan.