Early Estimates Help

       Oliver Wendell Holmes, Jr. said “Taxes are what we pay for a civilized society.”  Now is the time to start organizing yours.  Gather all of your receipts and notes.  Look at major differences between your 2010 numbers and those for 2011.  You should have all of your W-2s and 1099s by January 31.

       The earlier you file the faster you can get your return.  Estimating your liability early, even if you don’t file early, will allow you to manage your budget more accurately. Dragging your feet until the last moment could be costly.

       This is also a good time to adjust your W-4 deductions.  You should only be withholding enough to cover your taxes; getting a big return means you let the government use your money, interest free.  Wouldn’t you rather have that money in your pocket?  If your refund totals more than $1000.00, you are having too much withheld.  A common strategy is to adjust your withholding and put the extra money into your emergency fund or retirement.  You won’t miss the money out of your check, you aren’t seeing it now, but you will be better prepared for the future

Tax Time

          It is now time to gather your receipts and accounts; the dreaded tax time. Have you already spent the big return that you think you will be getting? Or maybe you are scrambling to pay an anticipated bill. This could be the last year that you will have to live this nightmare. With just a little bit of adjusting you could owe nothing and get nothing. Coming out even is the goal.
         Contact your boss or HR manager to change your W4 form Adjust the number deductions so that the right amount of taxes are withheld; not too much and not too little. There are two benefits to following this system; you will not have to deal with the stress of tax time, and you are likely to increase your take-home pay.
           Check you return carefully. There are often deductions people miss because they are so weird. Believe it or not you can deduct the cost of a babysitter as a charitable deduction if you are leaving the house to do charitable/volunteer work. Unusual deductions like this are lurking everywhere and you are initiated to use any you can find.
         We have used Turbo Tax for a number of years and find that it is very good a t finding the hidden deductions. If you have kept your records in Quicken it will even enter most of your information for you, and remember it for subsequent years. This is an easy fix, but whatever system you choose be aware that you have lots of choices. The aim of the game is to come out even., and the ideal from a sound financial point of view.
        

Fraud Alert

It can happen to anyone. I just got one of those emails that is “phishing” for information. It looked like it really came from my bank and when I clicked on the link it took me to a page that looked like the home page for my bank. Whooa! Never, never, never, click on the link from a mysterious email, or any other account, even if it looks real, unless you have contacted the account yourself. These perpitrators are trying to steal you identity. Immediately go directly to the account in question to check on your status. Type in the address that you have on file; DO NOT use the link in the email; this tells the bad guys that you are vulnerable.
While you are in your account contact the fraud division. They may want you to forward the email to them. Banks and other companies take this kind of fraud very seriously. They work closely with law enforcement to find the bad people who are causing so many problems for people; especially those who aren’t aware of this type of fraud. This kind of identity theft can cause you years of hassles, lost credibility and huge amounts of money to repair.
It is a shame that we can't trust our fellow man, but unfortunately there are too many of these frauds happening to not be aware so you can protect yourself