Tax Preparation Tips

Tips for Tuesday

It's already March, which means tax day is just around the corner. If you haven't prepared your tax return yet, here is a list of what you will need to prepare the return or bring with you to your accountant.

PERSONAL INFORMATION
Have on hand for each of your family members:
• Name and address
• Birth Date
• Social Security Number
Have on hand the following:
• Name, address, Tax ID or Social Security Number of child care provider
• Amount of alimony paid/received and Social Security Number of recipient

EMPLOYMENT AND OTHER INCOME
• W-2 forms for the tax year
• Unemployment compensation
• State and local income tax refunds
• Rent income from personal property
• Partnership, S Corporation, Trust, Estate income
• Pensions and annuities
• Social Security benefits
• Recovery of bad debts deducted in a prior year
• Alimony/Maintenance
• Scholarships/fellowships
• Jury duty pay
• Gambling and lottery winnings
• Prizes and Awards

SELF-EMPLOYMENT INFORMATION
• Business income
• Partnership SE income
• Business-related expenses (with receipts)
• Employment taxes and other business taxes paid

OTHER FINANCIAL ASSETS
• Interest income statements
• Dividend income statements
• Proceeds from broker transactions
• Retirement plan distribution

HOMEOWNER/RENTER DATA
• Mortgage interest paid
• Sale of your home or other real estate
• Second mortgage interest paid
• Real estate taxes paid
• Rent paid
• Moving expenses

EXPENSES
• Gifts to charity
• Unreimbursed expenses related to volunteer work
• Unreimbursed expenses related to your job
• Investment expenses
• Job-hunting expenses
• Job-related education expenses
• Tax return preparation expenses
• Adoption expenses
• Child care expenses
• Alimony paid
• Medical savings account
• Tax return

OTHER FINANCIAL LIABILITIES
• Auto loans and leases if vehicle used for business
• Student loan interest paid
• Early withdrawal penalties on CDs and other time deposits

OTHER TAX DOCUMENTS AND INFORMATION
• Federal, state and local estimated income tax paid (have payment records or vouchers)
• IRA, Keogh and other retirement plan contributions
• Medical expenses documents
• Casualty or theft losses documents
• Personal property tax information

Remember, if you want to claim it, you should have proper documentation. You should collect these receipts and papers throughout the year in an income tax file. This will make tax preparation much easier when the time comes because everything will be together.

Moving Insurance—Why You Should Have It

Moving on Monday

You've done your homework and hired the best mover based on recommendations and reviews. You trust them to pack your belongings onto their truck and drive away with it, confident it will arrive at your new home safe and sound. In most cases, it will. However, at times there are accidents and emergencies, usually through no fault of the drivers. It may be extreme weather or another driver's poor judgment.

This is when insurance is so important. This is also not the time to wonder whether or not you have enough coverage on your belongings. The time to review this is when you sign the contract with your moving company.

All companies offer basic coverage at $0.60 per pound. They will pay you $0.60/pound for every possession on their truck, from dominoes to diamonds. That isn't much of something should happen. So companies also offer full value protection at a cost of approximately one percent of the value of the items.

How they reimburse you is up to them. They will either repair the broken items or replace them. For older items, you will be reimbursed the fair market value, which will not cover the cost of a new item. Finally, moving companies are not obligated to reimburse you for anything valued at over $100/pound unless it is itemized in an inventory list and submitted to the moving company.

If you feel this is still not enough coverage, you can ask the mover if they have other valuation options. Also, look into your homeowner's policy to see what they would cover in the event of an emergency.

Some of your belongings are irreplaceable. Consider taking those items with you in your car or on the plane, if possible.

Safe journey!

Should I Stock Up on Sale Items?

Frugal Friday

We all like to save money, so when something is on sale, why not save even more money by buying more of the item on sale? It seems to make sense, but is it really saving you money? That depends.

There are several factors to consider when stocking up on sale items.
First is storage space. If paper towels are on sale, and you decide to buy five cases, where will you keep those cases until they are used up? If you buy ten tubes of toothpaste, which are small, will they fit in your linen closet?

Second, will you use it up before the next time it goes on sale? Perhaps the tomato soup is a really great deal, but will you use 24 cans before the next sale? If you watch the ads regularly, you can follow how often items are on sale. Some are seasonal, some are as often as monthly. If you know it will be on sale again soon, by just enough to last you until the next time.

Third is perishables. Yes, the orange juice might be a great deal, but will you use everything you buy before it spoils or expires? The same goes for anything perishable. If you are able to freeze the item, then consider purchasing more. But always keep in mind how much you will use, and whether or not you have the room to freeze it. And don't forget, food goes bad in the freezer, too.

Fourth, don't buy super-sized items or mega packages unless you know you like the product. If it's something new on the market, or a new flavor, don't buy it in a large size. You may not like it, and it's wasted money when you throw it away.

Finally, is it worth the drive? If you have to drive several miles to buy one item (sometimes the store limits quantity), is it worth the cost of gas and your time?

Be frugal, but be smart.

What items have you stored up on recently?

Resources for Seniors

Senior Thursday

As a large part of the population continues to age, they require special services unique to the elderly. Some are a result of health issues, and some are monetary. They may find themselves unable to live in a two-story house because of navigating the stairs. If they already have a ranch home, then perhaps the yard is too much to maintain.

Some seniors can't perform simple personal tasks, such as bathing. So in addition to needing help with their home, they need help for themselves. Others may be healthy, but are struggling financially. In these cases, they need help paying for meds or paying bills.

So where do they find resources for assistance? They may need caregivers, medical advice, housing assistance, or information on laws protecting them. One place for both federal and state resources is USA.gov. This is a great start for many issues facing the elderly today, including raising grandchildren, something new to this generation of grandparents.

Local townships offer great resources also, as do hospitals. These resources include everything from free meal delivery to in-home nursing care. Don't be afraid to ask. Sometimes you can't do it all on your own.

Setting Up a Filing System

Tips for Tuesday

Even if you don't own a business, you should still have a filing system for your personal files. Everyone has financial, medical and possibly legal papers. It is important that you are able to find them when you need them.

Setting up a system is simple if you follow a few rules.

First,sort your papers into broad categories. Put school, work, medical, bank, credit card, home maintenance, etc., papers into piles. Further sort them into specialized categories. For example, you should have individual medical files for yourself, your spouse, each of your children, and your pets. Each person should have their own folder.

Next, create folders for each of these piles. If you are a visual person, use different colors for each broad category. Name each file. Use only a few words that clearly identify the contents. This will usually be a noun and verb, and perhaps a year. "Tax documents 2011" for instance, or "VISA Chase."

Place your files in a cabinet or drawer close to where you use them. They may not all be in the same place. File them by category or alphabetically—whichever works best for you.

If you are file challenged, then purchase a system that categorizes and indexes everything for you, such as Viewables from Smead. Use their colors, or customize your own labels.

Finally, keep on top of filing! File papers as they come in, and purge old ones you don't need.

Should I Move Myself?

Moving on Monday

Moving is both stressful and expensive. Therefore, it's logical to want to save money wherever you can. Sometimes it's finding free boxes and packing materials. Sometimes it's using friends and family to store extra furniture for you. And sometimes you decide to save money on movers and move yourself.

There are advantages and disadvantages to this. First, let's look at why it's a good idea.
• You save money – on labor, insurance.
• You will be more careful with your items because they are yours.
• You work on your own timeline. Sometimes movers wait until they can fill a truck before they will complete a move. But when you move yourself, you fill your own truck or pod on your own schedule and move when you want.
• If your move is only a short distance, then it's probably worth it to move yourself. The cost of the labor in this case would be packing the truck.

Why shouldn't you move yourself?
• It is physically challenging, especially for the larger pieces of furniture. The older you get, the more difficult it would be for you to lift heavy items.
• You have to supply all the materials—boxes, padding, cushioning, tape, etc.
• You're not a professional mover. They know how to maximize space, and stack items accordingly.
• If your move is cross-country, then hire movers. That is, unless you are comfortable driving a large truck a long distance. Many aren't that adventurous.

Another alternative is a combination of the two. You pack a pod or storage cube, then schedule with the moving company to bring it to your new home and unpack it on your own. This saves money, but requires physical labor.

Only you can determine the best route for you to take. Knowing the advantages and disadvantages of each helps in making the decision.

Frugal Uses for Kitchen Items

Frugal Friday

As the cost of groceries and gas continue to rise, we are looking for more and more ways to save money elsewhere. Coupons can save money. Purchasing second-hand can save money. Another way to save money is to use everyday household items for purposes other than for what they are intended. It's called "Re-purposing." Here are some ideas:

• Use an empty egg carton or ice cube tray for earrings or rings in your dresser drawer.
• Use an empty egg carton to hold paperclips and other small items in your desk drawer.
• Use empty checkbook boxes (or other small boxes) for dividers in your kitchen drawers.
• Use a muffin tin to play sorting games with your children.
• Make a funnel from the top of a soda bottle.
• Empty baby food jars can hold screws, nails, beads, or buttons.
• Large glass jars can be filled with candy, topped with fabric and ribbon, then presented as a gift.
• Glass jars can be used as vases—with or without decorating.
• Cut the bottom off a plastic bottle and use it as a scoop for bird food or dog food.

What have you re-purposed in your kitchen?