529 College Savings Plan – Best Way to Save for Your Child’s College Education?

529 college savings piggy bankSaving for your children’s college tuition might seem like an unavoidable necessity. Financial aid doesn’t help everyone, and with education expenses rising, college scholarships aren’t going to cover everything. How much thought have you given to saving for your child’s education?

For many couples, planning for college is part of everyday budgeting. For others, there just never seems to be enough money available to start saving. Your child will be going to college before you know it. If you have five years left or even fifteen, don’t wait to start saving. Start today. When you are ready to take the plunge, make sure that you take a look at a 529 savings plan. Investing in a 529 plan is one of the most efficient ways to save for your kids’ college costs.

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401k vs 403b – What’s the Difference in these Retirement Plans?

retirement plan bookOn my first day at my first job out of college, I was given a big packet of information about my benefits, including health insurance and retirement. I’d read about the 401k beforehand, but my packet instead had information on a 403b retirement plan. I was confused – what is a 403b, what’s the difference, and why did I get a 403b instead of a 401k?

A 403b is a tax-deferred retirement plan that is very similar to a 401k. That is, it allows you to set aside pre-tax dollars out of your paycheck to save for retirement – up to $16,500 per year, and for some people, the limit may be higher.

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IRA & 401k Required Minimum Distributions (RMDs) – Rules & Requirements

hammer piggy bankThe government wants to help you save for retirement by giving you incentives like tax-deferred growth and deductible contributions through IRAs and work-sponsored plans.

But while the government forgoes taxes on the front-end, it doesn’t want to end up entirely empty-handed. At the age of 70 1/2, you’re required to start taking withdrawals from most retirement accounts; otherwise, you will face stiff penalties. These are known as required minimum distributions, or RMDs. They’re intended to prevent individuals from hoarding money, so the IRS can eventually get its cut of your savings.

Required Minimum Distributions (RMDs)

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What Are Substantially Equal Periodic Payments (SEPP) – Rule 72(t) Distributions

golden egg cash handIf you’re lucky enough (and prepared enough) to retire early, you may run into a little snag when you try to withdraw money from your IRA or 401k: You’ll be charged a 10% penalty for taking it out before the age of 59 1/2.

However, one way many early retirees get around this is by withdrawing specific amounts of money in substantially equal period payments, or SEPP. It’s also known as the 72(t) rule, after the IRS code section to which it refers.

An SEPP plan allows you to withdraw money without getting the 10% penalty, as long as you adhere to specific rules set out by the IRS.

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How to Choose a Certified Tax Preparer – 3 Common Tax Scams to Avoid

taxes scam accountantIf you hate doing your own taxes, you’re certainly not alone. According to the IRS, as reported by the Washington Post, more than 60% of Americans hire tax professionals to fill out those nerve-wracking, headache-inducing, seemingly unending forms.

However, while having someone else do your taxes can take a load off your shoulders, if you don’t choose the right person, you might end up facing even bigger problems. Just as in any industry, there are unscrupulous tax preparers out there looking to make a quick buck – and they can get you into all sorts of hot water by finding less-than-legal ways to boost your refund or take advantage of you.

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First-Time & Repeat Home Buyer Tax Credit – Rules and Limits

home buyer tax creditIf you were one of the millions of people who became a homeowner between 2008 and 2010, whether it was your first time or your fifth, your purchase will have quite a noticeable effect on your taxes. That’s not only due to the lovely bump you’ll get from deducting your mortgage interest and property taxes, but you may also receive a nice fat tax credit on top of that!

For many, participating in these programs will have effects for years to come. There are special rules to determine who’s eligible, as well as tax credits available for non-first time home buyers, and a special extension for members of the military and federal employees who were stationed outside of the country, which we’ll discuss below.

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How to Pay IRS Taxes – Online, Check or Credit Card

pay taxes april

As we head toward the April tax filing deadline, you may have already finished your taxes, or at least begun to compile the paperwork to do so. And if you expect to owe money this year, it’s helpful to understand your options for paying. There are a few different ways to get your payment to the IRS on time – each with its own set of pros and cons depending on your situation.

3 Ways to Pay Your Taxes

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How to Pay Federal Estimated Taxes Online to the IRS

taxes pen calculatorAs a small business owner and freelancer, I’m amazed by how quickly my employed friends get their taxes done. Their employers withhold taxes year-round, and all these friends have to do is file by the IRS tax deadline to get a tax refund. But if, like me, you don’t have a human resources department pulling tax money out of your paycheck for you, you have to pay estimated taxes four times a year.

This system helps the government maintain a reliable schedule of when money is coming in, and it protects you from having to cough up all the dough at once. While it’s a little extra work, filing your estimated tax payments each quarter helps you stay on top of your taxes.

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United States Tax History – Federal Income Tax History in America

100 bill united statesIt’s probably safe to say that Americans rarely find taxes fascinating. In fact, “frustrating,” “nerve-wracking,” and “head-scratching” might be more favored terms for describing the requirement to pay a portion of your money to the Federal Government. However, taxes have played a very important and – in all honesty – fascinating role in U.S. history. Most significantly, the process that would eventually lead to the Revolutionary War and America’s independence was instigated in part by the Stamp Act, Sugar Act, and Tea Act (which incited the Boston Tea Party) – all of which were tax and tariff laws placed by England on the colonies to raise revenue.

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Important Quarterly Tax Due Dates & Deadlines – IRS Tax Calendar

tax return due

Taxes are a hassle. Dates and deadlines seem to sneak up without warning despite being relatively consistent from year to year. However, getting organized and preparing throughout the year can make the traditional tax season less dreaded and much easier to navigate.

Keep these major 2016 tax dates in mind and mark them on your calendar. And note that if the date falls on a weekend or holiday, the deadline moves to the next business day.

First Quarter: Prep Time and Paperwork

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