Personal Finance

Education & Careers

New Name, Better Benefits for Education

Americans, in general, are not savers. Not even when the reason for saving is a good one: education. Uncle Sam has decided to try to encourage saving for education by renaming and revamping the education IRA.The new program is called a Coverdell Education Savings Account or ESA. It was created as an incentive to help students and their parents save for education expenses. Like the education IRA, an ESA is set up for a beneficiary under the age of 18.

New Roth 401(k) Adds to Workers' Investment Options

Whether it makes more sense to pay taxes now or at retirement is a question many workers will be pondering if their employers offer them a new Roth 401(k) investment option.Starting next year, the Internal Revenue Service will allow employers to offer a Roth 401(k), which has been described as a cross between the Roth IRA and a traditional 401(k).
Tax

Users Wondering if eBay Profits are Taxable

If bribes, gambling winnings, kickbacks and money made in illegal activities can be taxed then surely profits made from selling items on eBay counts as taxable income too, right?
Tax

FDIC Wants Banks to Notify Customers of Identity Theft

On Friday, March 18, 2005, regulators at the Federal Deposit Insurance Corp. (FDIC) voted 5-0 to approve a ruling that would force U.S.

Study: Retirees Would Get Less Money Under Bush Plan

Most workers who choose the “default” investment option under President Bush's plan for Social Security personal accounts would do better under the existing system.That's according to Yale University finance economist Robert J. Shiller, who has concluded that nearly three-quarters of workers who opt for the “default” life-cycle accounts, which automatically make investments more conservative over time, would do worse than the traditional system 71 percent of the time, The Washington Post reported.The 71 percent figure is based on global rates of return.
Practice

Eight Secrets for Generating Big, Bold, Creative, Profitable Ideas

Secret 1: Accept All Ideas. That's right. All ideas, not just the ones that you feel comfortable with or that seem to make sense. Obviously, you're not going to implement every idea (especially considering the fact that you're aiming for 1,000 of them in the initial generation phase!), but you must greet them all with gratitude, respect, and a positive attitude. Acceptance makes people comfortable enough that they feel free to submit more and more ideas. Remember, the more ideas you start with, the better the end product.
A&A

The IRS Asks, Do You Have a Deductible Home Office?

Whether you are self-employed or an employee, if you use a portion of your home exclusively and regularly for business purposes, you may be able to take a home office deduction.You can deduct certain expenses if your home office is the principal place where your trade or business is conducted or where you meet and deal with clients or patients in the course of your business.
Tax

IRS Clarifies AMT Deduction for Home Mortgage Interest

Qualified housing interest, which generally is deductible for alternative minimum tax purposes, includes interest paid on a mortgage that has been refinanced more than once, the Internal Revenue Service confirmed late last week.In Revenue Ruling 2005-11, the IRS stated that interest paid on a loan that is refinanced more than once will retain its status as qualified housing interest, to the extent that the amount of the loan is not increased.This ruling may affect the amount some taxpayers report as a home mortgage interest adjustment on Form 6251, Alternative Minimum Tax-Individuals.
A&A

Women Sue Small Business Administration Over Missed Goals

Upon viewing the disturbing results of a recent U.S. Women's Chamber of Commerce national survey of women business owners which found a remarkable 62 percent unable to access capital they need to be competitive -- despite their preparedness and available collateral --, the leaders of the USWCC decided to take dramatic action.To significantly increase access to capital for the more than 10 million women-owned businesses in the U.S., the USWCC announced a groundbreaking partnership with Newtek Small Business Finance.
Tax

IRS Clarifies Child Tax Credit

With the Child Tax Credit, you may be able to reduce the federal income tax you owe by up to $1,000 for each qualifying child under age 17. A qualifying child for this credit is someone who:Is claimed as your dependent,Was under age 17 at the end of 2004,Is your son, daughter, adopted child, grandchild, stepchild or eligible foster child, your sibling, stepsibling or their descendant, andIs a U.S. citizen or resident alien. The credit is limited if your modified adjusted gross income is above a certain amount.
A&A

Push is on to Require Finance Education in High Schools

Hoping to stem the future tide of overwhelming credit card debt, personal bankruptcies and foreclosures, seven states are now requiring high school students take a personal finance class, the Associated Press reported.A survey by the National Council on Economic Education found that the seven states require the basic finance course as a prerequisite for graduation, which is up from four states in 2002.
Community News

Investment Firms Digging Deeper into Client Relationships

Some investment houses are going the extra mile to forge lasting relationships with clients by offering “life planning” advice as part of the investment package, the Associated Press reported.You've seen the Morgan Stanley commercials where the investment advisor could be mistaken for a spouse, well that strategy is taking hold across the industry as investment advisors talk to their clients about life goals, dreams and values.Some are going so far as taking their clients away on short retreats to country clubs and resorts to get a better handle on the individual's needs.
Tax

Consumer Information Stolen From Another Data Broker

Names, addresses, driver's license records and Social Security numbers of about 30,000 consumers may have landed in the hands of criminals.LexisNexis, a major compiler of public consumer information, said the theft occurred at its subsidiary, Seisint, the New York Times reported. The announcement comes on the heels of other security breaches. Data broker ChoicePoint said records of about 145,000 consumers were accidentally sold to criminals.
Technology

Tips to Guard Against Identity Theft Vulnerability

The average victim of identity theft spends about $4,800 and 30 hours to rectify effects of the crime, according to a recent Federal Trade Commission (FTC) study. Identity theft is the fastest growing crime in the U.S., and has spurred new legislation requiring businesses and even consumers to destroy certain documents before throwing them away.

Sen. Hagel Proposes Alternate Social Security Plan

Senator Chuck Hagel, a Nebraska Republican, has proposed his own fix for Social Security, which would include increasing the retirement age to 68 years old, the Associated Press reported.Hagel's plan was unveiled Monday and includes a provision to allow younger workers to divert some funds to personal investment plans. The plan is based partially on life expectancy."This reality is daunting, but there is good news in all of this. The system can be fixed. It is within our power to preserve the social safety net of this nation," said Sen.
A&A

GOP Proposes Big Tax Relief for U.S. Businesses

Senate debate continues today on a proposal to offer $4.2 billion in tax relief for U.S. businesses to lighten the burden of a higher minimum wage.The proposal, offered by Sen. Rick Santorum, R-Pa., calls for tax breaks and regulatory relief combined with raising the minimum wage by $1.10 to $6.25 per hour over 18 months, according to Dow Jones Newswires, quoting Senate aides.Santorum's plan counters a proposal by Sen.
A&A

Treasury, IRS Issue Proposed rules for Roth Contributions to 401(k) Plans

The Department of Treasury and IRS this week announced proposed regulations regarding designated Roth contributions to 401(k) plans. Roth contributions, which were created in the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), will allow for employees to designate all or a portion of their 401(k) employee deferrals on an after-tax basis. Most distributions of the amount contributed as well as any earnings on those contributions will be tax-free.
Tax

Citigroup Reaches $75M Settlement on Global Crossing Suit

Citigroup on Wednesday announced it has settled class action litigation brought on behalf of purchasers of Global Crossing securities which was pending in the United States District Court for the Southern District of New York as In re Global Crossing Ltd. Securities Litigation, No. 02 Civ. 910 (GEL).
Tax

Free Credit Report Offers... Are They Really Free? - Consumer Alert

Free credit report offers seem to flood the Internet these days. Most companies claiming to give you a free credit report are really looking to sell you something in the long run, such as a credit monitoring service or identity-fraud protection. Once you purchase the service, you will be given a copy of your credit report, usually from just one of the major credit bureaus. Since there are three major credit reporting agencies (Experian, Transunion, and Equifax), you will not see the complete picture if you do not receive a report from each one.
Tax

Wealthy Taxpayers Feeling the Pressure from IRS

The Internal Revenue Service is targeting wealthy executives and entrepreneurs to ferret out would-be tax dodgers.The IRS has not focused on individual tax returns of the well-to-do for years, the Wall Street Journal reported, but is becoming more aggressive after studying the results of a 2003 pilot program covering 24 big companies, which were not identified.Because of the tax problems the pilot program exposed, "we're moving toward a position where we routinely look at compensation of executives when we conduct our audits of corporations," IRS Commissioner Mark Everson told the newspa

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