25 Sep
The Internal Revenue Service unveiled a special new section on their website for people who have lost their homes due to foreclosure. The IRS also reassured homeowners that, although mortgage workouts and foreclosures can have tax consequences, special relief provisions can often reduce or eliminate the tax bite for financially strapped borrowers who lose their homes.
The new section includes a variety of information, including a worksheet designed to help borrowers determine whether any of the foreclosure-related relief provisions apply to them. For those taxpayers who find they owe additional tax, it also includes a form they can use to request a payment agreement with the IRS. In some cases, eligible taxpayers may qualify to settle their tax debt for less than the full amount due using an offer-in-compromise.
The IRS urges struggling homeowners to consider their options carefully before giving up their homes through foreclosure.
Under the tax law, if the debt wiped out through foreclosure exceeds the value of the property, the difference is normally taxable income. But a special rule allows insolvent borrowers to offset that income to the extent their liabilities exceed their assets.
The IRS cautions that under the law, relief may be limited or unavailable in some situations where, for example, part or all of a home was ever used for business or rented out.
Borrowers whose debt is reduced or eliminated receive a year-end statement (Form 1099-C) from their lender. By law, this form must show the amount of debt forgiven and the fair market value of property given up through foreclosure. Though the winning bid at a foreclosure auction is normally a property’s fair market value, it may not necessarily reflect its true value in some cases.
The IRS urges borrowers to check the Form 1099-C carefully. They should notify the lender immediately if any of the information shown on their form is incorrect. Borrowers should pay particular attention to the amount of debt forgiven (Box 2) and the value listed for their home (Box 7).
22 Aug
1. Coffee
2. Cigarettes
3. Alcohol
4. Bottled water
5. Manicures
6. Car washes
7. Weekday lunches out
8. Vending machine snacks
9. Interest charges on credit cards
10. Unused memberships
source
01 Aug
From David Bach, a killer method he calls DOLPing [Dead on Last Payment] to eliminate credit card debt:
1. Make a list of the current outstanding balances on each of your credit card accounts.
2. Divide each balance by the minimum payment that particular card company wants you to make. The result is that account’s DOLP number.
For example, say your outstanding Visa balance is $500 and the minimum payment due is $50. Dividing the total debt ($500) by the minimum payment ($50) gives you a DOLP number of 10.
3. Once you’ve figured out the DOLP number for each account, rank them in reverse order, putting the account with the lowest number first, the one with the second-lowest number second, and so on.
You now know the most efficient order in which you should pay off your various credit card balances.
4. Pay as much as you can each month toward the card with the lowest DOLP number. For each of your other cards, make only the minimum payment.
5. Once a card is paid off, cut it up — but don’t close the account! Leave the account open so you have credit you aren’t using, which will help improve your credit score.
26 Jul
In a recent scam, consumers have received a “Tax Avoidance Investigation” e-mail claiming to come from the IRS’ “Fraud Department” in which the recipient is asked to complete an “investigation form,” for which there is a link contained in the e-mail, because of possible fraud that the recipient committed. It is believed that clicking on the link may activate a Trojan Horse.
The IRS urged people not to click the link in the e-mail or open the attachment.
Similar e-mail variations suggest a customer has filed a complaint against a company and the IRS can act as an arbitrator. The latest versions appear aimed at business taxpayers as well as individual taxpayers.
The IRS does not send out unsolicited e-mails or ask for detailed personal and financial information. Additionally, the IRS never asks people for the PIN numbers, passwords or similar secret access information for their credit card, bank or other financial accounts.
24 Jul
Price Protectr’s new website is ready to save consumers money.
PriceProtectr.com offers a free service where registered users receive an automated message when the price drops on something they’ve purchased. For many consumers, that can mean money back.
“The majority of consumers don’t even know about price protection policies and the money they can save,” said CEO James Wallace, speaking from the New York office. “We cover over 30 national retailers, including Amazon, Best Buy, Sears, and Staples, more than any other price protection site.”
If the price goes down after someone buys an item from one of Price Protectr’s 33 retailers, registered users get an e-mail with instructions on how to get some money back from the store.
09 Jul
Web sites aggressively advertising “free” credit reports are charging consumers for services they are unlikely to need, while drawing attention away from the site created by law to provide consumers with free credit data every year, says a Consumer Reports WebWatch study.
The study analyzes 58 offers made on 24 sites, almost all of which advertise “free” credit reports and scores. Most make the offer in conjunction with the purchase of “credit monitoring” services (which are supposed to notify consumers of changes to their credit reports) or credit scores (which use mathematical formulas to predict consumer creditworthiness based on credit data). Credit monitoring services cost as much as $160 per year on these sites. Credit scores can cost as much as $75.
The Fair and Accurate Credit Transaction Act of 2003 (FACTA) entitles consumers to obtain, once a year, a free copy of their credit reports from each of the three major credit reporting bureaus — Equifax, Experian, and TransUnion. The site set up to deliver those reports is http://www.annualcreditreport.com.
The report notes that the proliferation of Web sites offering “free” credit reports may confuse consumers. Some of those sites even appear to disparage the information on offer from annualcreditreport.com.
08 Jul
Accurate negative information can be reported on your credit report for up to seven (7) years, but there are exceptions:
- Bankruptcy information can be reported for 10 years;
- Information reported because of an application for a job with a salary of more than $75,000 has no time limitation;
- Information reported because of an application for more than $150,000 worth of credit or life insurance has no time limitation;
- Information concerning a lawsuit or a judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer; and
- Default information concerning U.S. Government insured or guaranteed student loans can be reported for seven years after certain guarantor actions.
05 Jul
From TrustedID:
1. Buy a shredder.
2. Change your passwords monthly.
3. Freeze your credit.
4. Beware of phishing scams.
5. Protect your computer from spyware and viruses.