Friday, April 25, 2008

Find out if you will receive an Economic Stimulus Package Refund

Economic Stimulus Payments Information Center

Updated April 25, 2008
Starting in late April, the Treasury will begin sending economic stimulus payments to more than 130 million households. To receive a payment, taxpayers must have a valid Social Security number, $3,000 of income and file a 2007 federal tax return. IRS will take care of the rest. Eligible people will receive up to $600 ($1,200 for married couples), and parents will receive an additional $300 for each eligible child younger than 17. Millions of retirees, disabled veterans and low-wage workers who usually are exempt from filing a tax return must do so this year in order to receive a stimulus payment.

Even though April 15 has passed, there is still time for retirees, disabled veterans and others who normally do not file a tax return to submit a 2007 form to receive an economic stimulus payment.

The IRS website has a calculator to determine if you will receive a refund.

The Basics
You can search for the following topics in the Newsroom section
Basic Information on the Stimulus Payments
IRS Will Send Stimulus Payments Automatically Starting in May; Eligible Taxpayers Must File a 2007 Tax Return to Receive Rebate
Facts about the 2008 Stimulus Payments
More Information on Stimulus Payments Posted to; New Details for Recipients of Social Security, Veterans Benefits
Special Economic Stimulus Letters Reach Mailboxes in March
Special Economic Stimulus Payment Packages Go to Social Security, Veterans Recipients

Economic Stimulus Payment Calculator
A new online calculator will give you an estimate of the stimulus payment you may be due. Just answer a few questions and the calculator will do the rest.

Economic Stimulus Payment Schedule
Payments will start May 2. The last two-digits of your Social Security number and whether you opted for direct deposit into your financial account or a paper check will determine when you receive your payment.

Stimulus Payment Scenarios
What does it look like for you?
Married with Qualifying Children
Married without Qualifying Children
Married Filing Separately, with or without Qualifying Children
Single (Head of Household) with Qualifying Children
Single without Qualifying Children

You May Be Eligible Even if You Normally Do Not File a Tax Return
If you have at least $3,000 in certain types of income, you may be eligible for the economic stimulus payment. You also may be able to use a Free File - Economic Stimulus Payment. See the special types of benefits or income that qualify below:

Especially for Social Security Recipients
Information for people who receive retirement, disability or survivors' benefits
Especially for Veterans Affairs Recipients
Information for people who receive pension, disability and survivors' benefits
Especially for Railroad Retirement Recipients
Information for people who receive Tier 1 Railroad Retirement benefits
Especially for Low-Wage Workers
Information for people who receive a wages, salary, tips, etc. or who are self-employed
Especially for Military Combat Personnel
Information for members of the military serving in a combat zone

Frequently Asked Questions
We have the answers to your questions in Answers to Frequently Asked Questions

Rebate Scam Alert
Be aware that identity thieves are already pushing scams involving the stimulus payments. At least one telephone scam is making the rounds using the proposed rebates as bait. IRS Warns of New E-Mail and Telephone Scams Using the IRS Name; Advance Payment Scams Starting, has more details.

Free Help Available with Free File
Free File is the fast, easy and free way to file your federal income tax return. If your adjusted gross income was $54,000 or less in 2007, you can use Free File to prepare and e-file your taxes online.

If you normally don't file a tax return but need to file one for 2007 solely to receive your economic stimulus payment, you may now select from the list of companies on the Free File - Economic Stimulus Payment page.

Information For Businesses
IRS To Issue Guidance on Special 50-Percent Depreciation Allowance
2008 Economic Stimulus Act Provides Tax Benefits to Businesses
News Releases, Audio Files, Fact Sheets and Legal Guidance

Check out the complete list of IRS-issued news releases, audio files, fact sheets and legal guidance related to the stimulus payments.

Wednesday, April 23, 2008

I Can't Pay My Taxes - What Should I Do?

The deadline for filing your taxes has passed but there is still hope for those who didn't file their taxes on April 15, 2008. Here are some options:

1. Request an extension and request the maximum extension time of 6 months
2. Setup an installment agreement

If you owe taxes this year and don't have the money to pay the taxes owed to either federal or state here are some options:

1. Pay by credit card
2. Apply for a bank loan to cover the entire amount of taxes owed
3. Using savings accounts, savings bonds, stocks, etc.
4. Take out a loan from your life insurance policy
5. Take out a home equity loan
6. Borrow money from family or friends
7. Consider getting a part-time job or work overtime at your existing job to earn money to pay back your income taxes
8. Request an Offer in Compromise based on economic hardship

Saturday, April 19, 2008

Upcoming Events for April 2008

If you live in the DC/MD/VA area check me out at these upcoming events.

1. April 19, 2008, Credit and Debt Elimination Seminar, Borders, 8518 Fenton Street, Silver Spring, MD, 2pm
2. April 20, 2008, Bethesda Literary Festival, 4801 Bethesda Avenue, Bethesda, MD, 11-1pm
3. April 21, 2008, Interview w/Todd B - The Breakdown, Heaven 1580 AM, Lanham, MD, 8:30am
4. April 25, 2008, B. Dalton Booksigning, 50 Massachusetts Ave NE #112, Washington, DC, 4:30-6:30pm

Wednesday, April 16, 2008

7 Ways to Eliminate Debt

Reducing or eliminating your debt can see like an insurmountable task. You may feel like you can never get out of debt but you can. Other financial experts have been $100,000 to $1,000,000 in debt. I was $19,000 in debt making $21,000 a year and got myself out of debt. If we can do it you can too.

First, you have to admit you have a problem. Then you have to be committed to getting out of debt, just like you are committed to going to the gym, going to the hair salon or barbershop, or going shopping. Here are 7 ways to help you manage your credit card debt or any type of debt.

1. Stop spending. Don't spend money you don't have. This will result in your owing more money. Use your credit card for emergencies only.

2. Educate yourself. Educate yourself about credit and your credit rights. Read as much information as you can about credit cards. Start by reading the credit card agreement or disclosure that was sent to you when you first received your credit card in the mail.

3. Setup a debt payoff plan. Setup a debt payoff plan to prioritize your bills. By using the debt snowball method you will be able to quickly pay off some of your debts. Start by paying off the smallest bills first, then use the money paid towards a previous bill and apply it to the next bill and continue this process until all your debts are paid.

4. Setup a payment plan. Setup a payment plan with each of your creditors to pay off your debts. Be honest, humble and sincere. Identify any terms and negotiations you would like to make and stick to the terms.

5. Pay more than minimum monthly payment. If pay the minimum monthly payment you will end up paying 2 to 3 times what you actually charged due to the interest and finance charges that accrue on your balance. Try to send extra towards your balance each month.

6. Don't transfer balances. Transferring balances to another credit card may lower your credit score and there may be fees associated with transferring the balance. It is important to pay off the full balance before the introductory rate special ends because after the introductory rate ends the interest rate may drastically increase.

7. Pay with cash. Pay for purchases with cash until your credit card balances are paid in full. If you pay for an item with a credit card you end up paying 112% the original cost of the item.

Thursday, April 10, 2008

Credit Repair Secret Gem - Account Reaging

Account re-aging can help you get back in good standing with your creditors and increase your credit score. Account re-aging means the creditor will no longer consider an account late and will no longer be reported on your credit report.

Creditors will re-age your account once you have established a history of making payments on time. A creditor may re-age a past-due account if you agree to enter a debt management plan. The revised payment plan can be negotiated between you and your creditor or with the help of a credit counseling service or a debt management company. If you use a debt management or debt consolidation program make sure they are a reputable company and get the agreement in writing.

An account is legally considered delinquent if a payment has not been received 30 days after the due date. Banks have 2 methods for reestablishing delinquent accounts: re-aging and a financial hardship program. In the financial hardship program, you are given a fixed payment amount, and reduced interest rate for a year. This helps reestablish trust with the bank. Re-aging helps you because:

It stops late fees and over limit fees and allows more of your monthly payment to go towards the principal. This shortens the time it takes to pay off your debt.
The creditor reports your account as current with the credit bureaus.
Although you still owe the debt you are no longer delinquent on the account.
For mortgage accounts that were previously late, if you have been current for the last 12 months, ask the lender to re-age your account. By doing this all the late payments over 12 months old will be removed from your credit report.

Federal regulations and creditor policies limit the number of times an account can be re-aged, so once you have re-aged an account continue making your payments on time. A creditor may only re-age an account once in a 12 month period and twice in a five year period for credit card accounts, and once in a five year period for other types of accounts. In June 2000, the Federal Financial Institutions Examination Council established new guidelines for issuers to follow when re-aging credit card accounts. To be considered for re-aging:
1. The borrower should demonstrate a willingness and ability to pay.
2. The credit card account should be at least 9 months old.
3. The borrower should make at least 3 consecutive minimum monthly payments or the equivalent amount.

If a creditor agrees to re-age an account, ask them to confirm the details in writing. If the company refuses put the details of your re-aging program in writing. Send a copy to your creditor by certified mail with a return receipt.
By re-aging an account, the company will remove all late payments and added interest, reduce the interest rate paid on the account, and bring your payments current. They will also report the payment arrangement to the 3 credit bureaus, Equifax, Experian and TransUnion and this will increase your credit score.

Friday, April 04, 2008

Protect Your Children From Identity Thieves

We all are aware of identity thieves preying on unsuspecting adults and opening new accounts in someone else's name. The statistics for identity theft are alarming. There are several measures in place to help reduce your chances of being a victim of identity theft such as: shopping online at secure websites, don't carry your SSN or birth certificate in your wallet, use a paper shredder to shred personal papers and store financial information in a secure location. You can also use services such as credit monitoring, credit freeze and fraud alerts.

However, a new segment of the population that is a victim of identity theft is children. According to the Federal Trade Commission in 2007, 2% or 1,246 consumers age 19 or under were victims of internet identity theft. In 2007 5% or 11,769 of all identity theft claims were for children ages 18 or under. Those may seem small numbers but complaints for children are increasing every year. If a child is 15 and is a victim of identity theft tries to apply for a credit card at age 18 severe damage would have occurred to their credit history and credit rating would be nearly impossible to catch the identity thief.

Some parents open accounts in their children's name because they have bad credit. Parents please don't do this, you put your child at risk for becoming a victim of identity theft and it also considered fraud to forge someone else's signature.

To protect your child from becoming a victim of identity theft take the following 10 precautions:

1. Don't provide your child's SSN unless absolutely necessary. If you don't feel comfortable providing your child's SSN ask if your child can be assigned an alternate identification number, most companies will oblige, if they refuse, press the issue or take your business elsewhere.

2. Do research by visiting a company's website or calling the company to find out their privacy policy and ask questions such as: how is customer information stored, what happens if customer information is breached, is customer information encrypted, what security measures are in place to ensure employees of the company do not leak customer information and ask why a child's SSN is needed? For government agencies you should feel more at ease providing the information but use cautious when doing business with non-government agencies.

3. Monitor your child's SSN - many times family members are the main culprits who steal a child's identity.

4. Store and lock your child's personal information in a secure location.

5. If you child is a junior, senior, II, or III use your child's full name including the middle name or middle initial to ensure that their name is not confused with a family member's who could potentially have bad credit.

6. If your child starts receiving junk mail visit the DMA Consumers Organization website and click on the Consumers section to have their name removed from junk mail lists.

7. Check your child's credit report from the 3 major credit bureaus, Equifax, Experian and TransUnion to ensure they have not been a victim of identity theft. If you child is under age 13 you can only get a copy of their credit report by mail as a measure to protect your child's identity.

8. When filling out paperwork for your child that requires providing their SSN or birth certificate don't say their SSN out loud and don't write the SSN down on a piece of paper. Request that the person you are supplying the information to, not repeat your child's SSN or date or birth out loud, i.e. if they are writing down the SSN on a form ask to see the form to see if the SSN was written correctly.

9. Educate your child about shopping online at secure websites.

10. Educate your child about providing their personal information on the internet such as first and last name, age, SSN, address, telephone number, etc. All of this information can be researched and linked to find a child's SSN or address by using phone or SSN matching programs.

Get a copy of your child's credit report at least once a year at Your child (if old enough or you) can also take an identity theft risk test to see if your child is at risk for identity theft at the IDTheftCenter Organization website.