FINANCE

Online Tax Prep

Guide To Tax Deductions Plan For Retirement Financial Fitness Positive Change Avoid Financial Exploitation Coupon Tips Saving Offers Investment Fraud Prevention Counterfeit Currency

Doing Your Own Taxes Easier Than Ever

(NAPSI)—More Americans are switching from professionals and retail stores to do-it-yourself tax preparation websites. Online solutions offer a convenient way to file on a computer or tablet from home or anyplace else with Internet access. The tax guidance and tools in online solutions are more than adequate for most taxpayers, even those with complicated tax situations.

When choosing a tax preparation website, it pays to take note of the forms and tax situations covered by the products. You’ll also want to review pricing information carefully, as prices may not include state returns or tax help.

“Online tax prep products are carefully designed by CPAs, accountants and developers to translate complicated tax laws and forms into plain English,” explained Jessi Dolmage of TaxACT. “The programs have a simple but very intelligent Q&A interview to cover hundreds of credits and deductions and check for errors.”

What You’ll Need

Before doing your taxes on a computer or tablet, she recommends gathering all your tax forms and documents, including:

• Last year’s federal return (and state return, if applicable) for comparison purposes

• Form W-2 for wages, tips and pensions—employers have until Jan. 31 to distribute to employees

• Form 1099 for interest, dividends, state tax refunds, retirement plan distributions and unemployment—issuers have until Jan. 31 to distribute

• Form 1098 for mortgage interest paid

• Retirement plan statements

• Schedule K-1 from partnerships, S corporations, estates and trusts

• Estimated tax payments

• If you itemize deductions: receipts for health care expenses, and other income or sales taxes paid, mortgage interest and points, charitable gifts, work-related costs, investment expenses and casualty and theft losses

• If you’re a business owner: documents related to income statements (1099-MISC and payment stubs not reported on 1099s), health insurance payments and pension plan contributions (such as Keogh, SEP and SIMPLE)

• Social Security numbers for you, your spouse and your dependents

• Bank account and routing numbers if you want to get your refund by direct deposit or pay your taxes electronically.

Dolmage also reminds taxpayers to take stock of how your life changed. “Events like marriage, college, buying a house, having a child, moving and retirement could mean thousands of dollars difference in your refund or what you owe. Solutions like TaxACT guide you through the tax implications of life changes to make sure you’re not leaving any money on the table.”

Filing Tips

Tax experts also recommend the following:

• E-file. It’s secure and convenient, and you’ll receive confirmation when your return has been processed by the IRS.

• For the fastest refund, e-file and choose direct deposit.

• Before filing, double-check Social Security numbers, bank account numbers and spelling of names. Misspelled and wrongly typed numbers and names are among the most common mistakes made on returns.

• File and pay by the April 15 deadline to avoid IRS penalties and interest. If you file for a six-month automatic extension, remember that any balance is still due by April 15.

• Don’t procrastinate. Rushing can lead to costly mistakes.

Learn More

More tax tips and information can be found at www.irs.gov. To prepare, print and e-file your federal tax return free with TaxACT Free Federal Edition, visit www.taxact.com.

Note to Editors: Most relevant if published before April 15, 2013.

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A Simple Guide To Deductions

(NAPSI)—The average taxpayer doesn’t need to understand all the intricacies of tax law, but it pays to know a few basics. For example, taxpayers often know deductions save money on tax returns but may not be able to tell the difference among the types of deductions.

The Deal On Deductions

Deductions lower the amount of taxable income. You have the option of claiming the standard deduction or itemizing deductions and you should select whichever results in a higher amount. Nearly two-thirds of taxpayers claim the standard deduction, according to TaxACT spokesperson Jessi Dolmage.

Standard Deductions

Standard deduction amounts are adjusted for inflation each year, vary by filing status and are higher for those 65 and older or legally blind. For 2012 federal tax returns due April 15, 2013, standard deduction amounts are:

• $5,950 for single or married filing separately

• $11,900 for married filing jointly and qualifying widows(ers)

• $8,700 for head of household.

Itemized Deductions

When you itemize deductions, you list them all separately and only certain spending qualifies. Itemized deductions may include mortgage interest, state and local taxes, charitable gifts, unreimbursed employee expenses, uninsured casualty or theft losses and miscellaneous. Some miscellaneous deductions must exceed 2 percent of your adjusted gross income and unreimbursed medical and dental costs must exceed 7.5 percent of it.

Itemized deductions are reported on Schedule A and can only be filed with long Form 1040, while taxpayers claiming the standard deduction can file Form 1040, 1040A or 1040EZ.

If a married couple files separately and one spouse claims the standard deduction, the other must also claim the standard deduction. Conversely, if one spouse itemizes deductions, the other must also itemize.

Some deductions can be claimed regardless of whether you itemize or claim the standard deduction. Often referred to as “above-the-line” deductions because they are deducted from gross income, these include traditional IRA contributions, student loan interest, alimony payments, moving expenses and a portion of your self-employment tax (if applicable).

Dolmage suggests using an online or downloadable tax preparation solution to eliminate the guesswork involved with calculating whether the standard deduction or itemizing is more beneficial. “The program asks simple questions to help you determine if you qualify for the various deductions and other tax breaks. It then does the math for you and lets you know if you benefit more from the standard deduction or by itemizing.”

File Free

To help make calculating your deductions easy, TaxACT, the nation’s second-largest digital tax preparation provider, offers free federal tax returns. TaxACT Free Federal Edition provides step-by-step guidance for simple and complicated tax situations, plus all e-fileable forms, including those necessary for itemizing.

You can find more information about standard and itemized deductions in IRS Publication 501 at www.irs.gov. To prepare, print and e-file your federal return free with TaxACT Free Federal Edition, go to www.taxact.com.

Note to Editors: Please do not publish after April 15, 2013.

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Before You Retire, Plan Your Life

(NAPSI)—While any time of year can be the right time to assess your financial fitness, many find the new year is an excellent time to take stock of their financial status, drop old habits and cultivate new ones.

The good news is that financial fitness is a goal that’s very attainable. If you’re serious about making your financial future more secure, here are some helpful tips:

Set Goals And Have A Plan

To make a life change, you need more than a decision. You need a plan. A plan is the guide to put your decision into action so that you can reach your goal. Learning how to set goals takes practice, but according to the 2011 Stick With It study by Northwestern Mutual, the No. 1 strategy that works is “setting small interim goals.”

Talk To A Professional

An experienced financial professional can help you build a comprehensive plan and help manage personal asset protection and growth.

Save For Retirement

Saving for retirement needs to become a priority instead of an afterthought. Contribute as much as you can to your employer’s 401(k) plan, individual retirement accounts and special retirement accounts—even if you are a long way from retirement age. Your older self will thank you.

Consider Your Longevity

Are you prepared to live into your 80s, 90s or beyond? Life and long-term care solutions can play a crucial role in planning, particularly as people grapple with the challenges of managing longevity in retirement.

Check out a Lifespan Calculator (lifespancalc.com) for a glimpse into your potential future.

Think About Your Risks

You’ve worked hard to build a solid financial footing for yourself and your family, so it needs to be protected. Accidents and disasters can (and do) happen, and if you aren’t adequately protected, it could leave you in financial ruin.

Financial success is not an accident. It begins with a well-conceived plan. You and your family can achieve more in 2013 with a disciplined plan of action.

By putting a plan in place and taking steps to attain specific goals, you can set yourself on a path for a more productive new year and a more secure financial future.

To learn more or use the Lifespan Calculator, visit www.northwesternmutual.com.

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Positive Change For The New Year

(NAPSI)—While any time of year can be the right time to assess your financial fitness, many find the new year is an excellent time to take stock of their financial status, drop old habits and cultivate new ones.

The good news is that financial fitness is a goal that’s very attainable. If you’re serious about making your financial future more secure, here are some helpful tips:

Set Goals And Have A Plan

To make a life change, you need more than a decision. You need a plan. A plan is the guide to put your decision into action so that you can reach your goal. Learning how to set goals takes practice, but according to the 2011 Stick With It study by Northwestern Mutual, the No. 1 strategy that works is “setting small interim goals.”

Talk To A Professional

An experienced financial professional can help you build a comprehensive plan and help manage personal asset protection and growth.

Save For Retirement

Saving for retirement needs to become a priority instead of an afterthought. Contribute as much as you can to your employer’s 401(k) plan, individual retirement accounts and special retirement accounts—even if you are a long way from retirement age. Your older self will thank you.

Consider Your Longevity

Are you prepared to live into your 80s, 90s or beyond? Life and long-term care solutions can play a crucial role in planning, particularly as people grapple with the challenges of managing longevity in retirement.

Check out a Lifespan Calculator (lifespancalc.com) for a glimpse into your potential future.

Think About Your Risks

You’ve worked hard to build a solid financial footing for yourself and your family, so it needs to be protected. Accidents and disasters can (and do) happen, and if you aren’t adequately protected, it could leave you in financial ruin.

Financial success is not an accident. It begins with a well-conceived plan. You and your family can achieve more in 2013 with a disciplined plan of action.

By putting a plan in place and taking steps to attain specific goals, you can set yourself on a path for a more productive new year and a more secure financial future.

To learn more or use the Lifespan Calculator, visit www.northwesternmutual.com.

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Tips To Help You Avoid Financial Exploitation

(NAPSI)—Older Americans should know that while financial abuse is believed to cost seniors an estimated $3 billion annually, you can help prevent it and protect yourself.

Signs To Watch For

• You, family, friends or your bank notice financial activity you don’t recall, that is not consistent with your financial history or that is beyond your means.

• Your caregiver or beneficiary refuses to use your funds for necessary care and treatment or is threatening to place you in a long-term care facility unless you give him or her control of your finances.

• It appears that food or medication has been manipulated or withheld so you become weak and compliant.

Steps You Can Take

• If you feel threatened and believe you are in immediate danger, contact law enforcement.

• Talk with family members, friends and trusted professionals to plan your financial future. If managing your daily finances is difficult, consider engaging a money manager.

• Talk with a lawyer about creating a durable power of attorney for asset management, a revocable or living will, trust and health care advance directives.

• Never send anyone personal information to collect a prize or reward.

• Don’t be pressured or intimidated into quick decisions by a salesperson or contractor.

• Don’t sign any documents you don’t completely understand without first talking it over with an attorney or a family member you trust.

• Never provide personal information (Social Security, credit card, ATM PIN number) over the phone unless you placed the call and know with whom you are speaking.

• Tear up or shred credit card receipts, bank statements, solicitations and financial records before disposing of them.

• If you hire someone to help you in your home, be sure that person has been properly screened, with criminal background checks completed.

• If you suspect you or someone you know is being exploited, call (800) 677-1116 to get connected with the state Adult Protective Services or other appropriate aging resource.

• For more information on financial exploitation, you can request a free brochure from the Eldercare Locator, “Protect Your Pocketbook: Tips to Avoid Financial Exploitation.” Call (800) 677-1116; the brochure can also be downloaded at www.eldercare.gov. The Eldercare Locator is a public service of the U.S. Administration on Aging and is administered by the National Association of Area Agencies on Aging (n4a).

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Expert On Saving Offers Coupon Tips

(NAPSI)—According to a recent consumer survey, 81 percent of Americans are likely to make a resolution to save more money this year.

However, that doesn’t mean having to sacrifice quality. When it comes to personal care, Americans want trusted, effective products that inspire their families to develop healthy routines. Finding the right strategy to save without cutting corners can be difficult.

To help families get budgets in shape, nationally known money-saving expert Karen Wilmes, of KouponKaren.com, offers practical tips on utilizing coupons for your most trusted essentials:

• Purchase an extra newspaper for another set of weekly coupons-use just a few and it will be worth the cost. For example, the Healthy Essentials coupon book from Johnson & Johnson Family of Consumer Companies will provide over $175 in savings on brands that families trust and use every day, including Aveeno, Band-Aid brand, Johnson’s Baby, Listerine and Neutrogena.

• Check the expiration dates of everything in your medicine cabinet and list what you’ll soon need.

• Reference that list against your weekly ads and coupons to see what you can save money on buying that week. Often, products you find coupons for in the newspaper go on sale in stores weeks later.

Healthy Essentials coupons will appear in newspapers nationwide. If you miss them in print, visit www.HealthyEssentials.com for printable coupons and more.

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Investment Fraud Can Hit Close To Home

(NAPSI)—When it comes to investing, experts caution against blindly trusting social contacts.

They also say it can be surprising to find out who is really a wolf in sheep’s clothing. The good news is there are steps you can take to protect yourself.

According to Gerri Walsh, president of the FINRA Investor Education Foundation, fraudsters will often invest their time to develop relationships and credibility in a particular community. Typically, a scam artist may pose as a financial expert and a friend.

When making any kind of financial investment, even amongst friends, Walsh suggests you always exercise caution. Here are some simple steps to avoid becoming a victim of investment fraud.

• Learn to spot the “source credibility” fraud tactic. Is the seller trying to build credibility by claiming he is from a reputable firm or is well established in the neighborhood? Beware if emphasis is placed on the relationship you have with the seller rather than on critical specifics—such as why the investment is the right fit for your financial objectives, how the investment makes money and how it can lose money.

• Learn to spot the “social consensus” fraud tactic. The seller may try to convince you that everyone else is doing it. Even if that’s true, the popularity of the investment should not be your deciding factor.

• Ask and check before investing. Ask the seller about his license to sell securities and check with authorities to verify the information—even if you know him.

A Cautionary Tale

Unfortunately, it is possible that someone you trust and socialize with could defraud you. That’s what happened to Ruth and Len Mitchell, who were victims of an $11 million Ponzi scheme run by their neighbor and friend, Barry Korcan.

Korcan kept the books for Len’s business, was in Ruth’s skating club and did the Mitchells’ personal taxes. So when Korcan came to them with an opportunity to invest $130,000 in real estate bonds, the Mitchells did not think to question the legitimacy of the investment.

The Mitchells were not the only ones to fall into Korcan’s investment fraud scheme. Over time, many of the Mitchells’ friends and business associates also started investing with Korcan, believing in the Mitchells’ trust that Korcan was a legitimate seller.

The IRS finally uncovered Korcan’s Ponzi scheme and convicted him for mail fraud and tax evasion. The bad news is that the Mitchells and their friends had already lost their money.

For more tips on protecting yourself from fraud, visit the FINRA Foundation’s website at www.SaveAndInvest.org/LearnMore.

 

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The Holiday Gift You Don’t Want: Counterfeit Currency

(NAPSI)—There are more small and medium-sized cash transactions during the holidays than at any other time of the year, making November to December “prime time” for counterfeiters.

“By taking a few precautions, small-business owners can help protect themselves against currency fraud and increase their odds of having a happy holiday,” says Stacey Scudder, assistant vice president at Bank of the West. The San Francisco-based bank partnered with the U.S. Secret Service to educate merchants on counterfeiting.

“The best insurance against potential losses from counterfeit currency is to learn how to quickly and easily identify authentic currency,” Scudder says.

Here are six quick tips that Bank of the West and the Secret Service offer to merchants:

• Hold a $20 bill up to a light source. Each $20 note contains a clear strip inscribed with “USA Twenty.” The $20 bill is today’s most counterfeited denomination in the U.S. The other notes—$5, $10, $50 and $100—should also show a strip with their denomination printed.

• While holding the bill to the light, check for a watermark on the right side of the note. On the $5 note, you’ll see the number “5”; on the $10, $20, $50 and $100, the watermark and the portrait should match.

• The $10, $20, $50 and $100 have their numbers printed in color-shifting ink in the lower right corner. This technology is very hard to replicate, and in genuine U.S. currency, you’ll see the color shift from copper to green.

• Counterfeit detection pens are not always accurate and may give false results. The surer way to detect counterfeits is to be familiar with the security features.

• Think you’ve been passed a fake bill? Immediately notify the police. Try to remember the physical characteristics of the person who passed it and, if possible, write down the license plate number and vehicle description.

• Whatever you do, don’t pass a counterfeit bill along. Counterfeiting currency or possessing it with fraudulent intent is punishable by a fine or imprisonment for up to 15 years or both.

“We’re encouraging all merchants to be aware, stay informed and know what steps to take if you receive a fraudulent bill,” Scudder says. “Educate your employees, especially going into the holidays when there are so many temporary and seasonal cashiers who may not be familiar with the tricks of the trade for thwarting counterfeiters.”

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