Saturday, I attended training so I can volunteer with Baltimore CASH Campaign at Towson University to prepare taxes for lower income families. I volunteered last year and, even though it was difficult work at times, I found it incredibly rewarding to help people with the new skills I learned in school. I am feeling more confident about it this year, however, because I've just finished a semester of Tax Accounting and feel that I have a better understanding of the process. The Basic Level this year will include itemization and a few other things that I didn't deal with last year. I was able to attend the returning preparers training and found that I had a deeper understanding of the software.
While I was there, I made a contact with Habitat for Humanity of the Chesapeake and I am so excited to volunteer with their organization as well. As it happens, they don't just build houses. They also provide a means to furnish those houses and to help maintain them. The organization also restores some of the abandoned row-homes here in Baltimore. My new contact was telling me that there are so many programs offered by the city to help lower income individuals from drowning in property taxes and that most citizens aren't even aware they can get that kind of help. Volunteering with Habitat for Humanity isn't just about getting out there and swinging a hammer, there are so many other ways one can be of help to the community.
I am so excited about these opportunities and I hope that I can find ways to volunteer with these organizations throughout the year and not just at tax time.
Showing posts with label taxes. Show all posts
Showing posts with label taxes. Show all posts
Sunday, January 19, 2014
Friday, October 12, 2012
Tax Withholdings
I did a quick calculation of my tax withholdings for this year. My new placement on the commercial side of the company means that the state and local withholdings are finally correct. I've been playing with the idea of cancelling the additional $50 I had withheld when the California office was taking care of my payroll. If my calculations are correct, and I seriously hope they are, I could have a tax return of about $2-3K this year. I had extra withheld last year to compensate for cashing out my old IRA and forgot to change the withholdings for this year.
First, that's a lot of money and, whenever it looks like I'm about to get a windfall, I have to remind myself that I am fallible and have been wrong in my calculations before. Though I am usually not that far off of the mark. Still it's best not to count on that money or plan to spend it before I've even received my W-2's.
Second, there a number of big ticket items for which I considered taking out additional funds on my student loans. For example, updating my computer/printer/wi-fi or a down payment on the purchase of a house. These are practical items that will improve my financial outlook or further my educational goals. The question is, of course, a home in what location and can I really afford a mortgage?
Third, there are the fun things I want but have to diligently save to attain. Even when I save money, it is important to take care of the big ticket items mentioned above before the "fun" items. When I say "Fun" what I mean is that Japanese/European vacation my sister and I talk about but never seem to have enough money to take. If my calculations are, indeed, correct then this would solve the airfare problem very nicely - for both of us. It would just be a matter of saving the rest of the money for the hotel/food/mementos.
Finally, there are the practical items and uses for this money. I will undoubtedly have racked up some Christmas debt by the time tax time rolls around, though I swear I am not spending as much as I usually do. And that should definitely be paid off/down before using the money for anything else. Then there is the ultimate practicality of paying down the student loans I took out this fall or the remaining amounts on my undergrad loans. Or, using the tax money to bankroll my spring semester instead of relying on student loans to front the money until my company can reimburse me. But there really isn't anything fun about those options.
First, that's a lot of money and, whenever it looks like I'm about to get a windfall, I have to remind myself that I am fallible and have been wrong in my calculations before. Though I am usually not that far off of the mark. Still it's best not to count on that money or plan to spend it before I've even received my W-2's.
Second, there a number of big ticket items for which I considered taking out additional funds on my student loans. For example, updating my computer/printer/wi-fi or a down payment on the purchase of a house. These are practical items that will improve my financial outlook or further my educational goals. The question is, of course, a home in what location and can I really afford a mortgage?
Third, there are the fun things I want but have to diligently save to attain. Even when I save money, it is important to take care of the big ticket items mentioned above before the "fun" items. When I say "Fun" what I mean is that Japanese/European vacation my sister and I talk about but never seem to have enough money to take. If my calculations are, indeed, correct then this would solve the airfare problem very nicely - for both of us. It would just be a matter of saving the rest of the money for the hotel/food/mementos.
Finally, there are the practical items and uses for this money. I will undoubtedly have racked up some Christmas debt by the time tax time rolls around, though I swear I am not spending as much as I usually do. And that should definitely be paid off/down before using the money for anything else. Then there is the ultimate practicality of paying down the student loans I took out this fall or the remaining amounts on my undergrad loans. Or, using the tax money to bankroll my spring semester instead of relying on student loans to front the money until my company can reimburse me. But there really isn't anything fun about those options.
Friday, January 27, 2012
Taxes
I am starting to prepare my 2011 tax returns. It's important for the filing of the FAFSA I am going to do, though I am not 100% sure I need to do that for graduate school - must research and find out. So far everything is coming in as it should, I've gotten my day job W-2 and the 1098-E's for my student loans. I even received a 1098-T for the $400 or so dollars I paid for my Accounting I class this summer, which must be something new because I don't remember getting one when I attended undergrad over six years ago. I know I had the cash out of my DTB IRA, so that's an additional $6K I have not yet accounted for in my income. I'm not sure what form I need for that though, so there is a lot of information I need to collect before finalizing anything.
Right now, H & R Block is showing I will get $900 back from federal and $4000 from State. I realize these are not legitimate numbers, as I said I cashed out an IRA this year, and I'm really just hoping to break even. I contributed more to my 401(k) and had an additional $50 per paycheck withheld for state taxes to compensate for both the IRA cash out and my second job. So the estimates are far from realistic at this point, BUT wouldn't it be nice if they were?
That large of a return would pay off more than just the Christmas debt I saddled myself with this past holiday. It would give me extra for school, or vacations, or to put away for Christmas this year. Is this what homeowners feel like? I know they get a larger return than I normally do because of the property values and mortgage paid, etc. But of course that has to go back into upkeep of the house and property taxes. Could I possibly stop having an additional $50 withheld from my paycheck every two weeks? That would bring at least an additional $100 into my budget every month. I will have tuition payments this year. Perhaps I could rely on the regular withholding again.
It's just the thought of having to pay the government money at the end of the year freaks me out. It's not that I don't want to pay taxes at all or that I think they're too high, etc. It's just that I'd rather pay too much and have the government act as a sort of savings account than have to keep estimating throughout the year to make sure I don't have to pay when I file. The saving of money has never been easy for me, so owing the government would not be easy on my finances. It's the intense pressure of owing money to someone or some organization that causes me to freak out.
Right now, H & R Block is showing I will get $900 back from federal and $4000 from State. I realize these are not legitimate numbers, as I said I cashed out an IRA this year, and I'm really just hoping to break even. I contributed more to my 401(k) and had an additional $50 per paycheck withheld for state taxes to compensate for both the IRA cash out and my second job. So the estimates are far from realistic at this point, BUT wouldn't it be nice if they were?
That large of a return would pay off more than just the Christmas debt I saddled myself with this past holiday. It would give me extra for school, or vacations, or to put away for Christmas this year. Is this what homeowners feel like? I know they get a larger return than I normally do because of the property values and mortgage paid, etc. But of course that has to go back into upkeep of the house and property taxes. Could I possibly stop having an additional $50 withheld from my paycheck every two weeks? That would bring at least an additional $100 into my budget every month. I will have tuition payments this year. Perhaps I could rely on the regular withholding again.
It's just the thought of having to pay the government money at the end of the year freaks me out. It's not that I don't want to pay taxes at all or that I think they're too high, etc. It's just that I'd rather pay too much and have the government act as a sort of savings account than have to keep estimating throughout the year to make sure I don't have to pay when I file. The saving of money has never been easy for me, so owing the government would not be easy on my finances. It's the intense pressure of owing money to someone or some organization that causes me to freak out.
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