Learn more about SEP IRAs and how they work. Who Might Want to Establish a SEP? A high-income earning self-employed person with no employees might consider setting up a SEP IRA. It can be useful for deferring income, saving for retirement, and saving money on taxes. For self-employed people with no employees, it may be best to compare a SEP to an Individual 401(k) plan to decide which plan is better for you....
What is a Series LLC? An LLC (limited liability company) is a form of business ownership recognized by all U.S. states. An LLC is not a corporation, but it does provide the same liability protection as a corporation since it is separate from its owners (called “members”). An LLC with several members may be taxed as a partnership, with the profits passing through to the partners/members according to their share of the business....
Here’s how it works: You divide up all your discretionary spending into envelopes by category. So one for eating out, one for groceries, one for clothing, one for miscellaneous spending, etc. Generally, you would not pay your bills via this system; rather, you’d continue to pay them out of your checking account via direct debit. However, to make the envelope system work for you, you should stop spending stop using your checking account except to pay bills....
But the revocable living trust owns the grantor’s assets, and the trust doesn’t die. Those assets can therefore be transferred to beneficiaries, effectively settling the trust, without involving the probate court. A “successor trustee” is named in the trust documents to take care of this process, stepping in and managing the revocable trust when the grantor dies or becomes incapacitated. Irrevocable trusts can remain up and running indefinitely after the trustmaker dies, but most revocable trusts disperse their assets and close up shop....
It’s useful to have some form of guaranteed income in retirement to cover living expenses. When deciding whether to cash out your pension, compare the total monthly income that you will receive in retirement with your planned monthly expenses. If your income just covers your expenses, you may want to stick to monthly pension payments. You will depend more on that income to stay afloat in retirement. However, if your guaranteed income far exceeds your expenses, it may make sense to withdraw your pension before retirement as a lump sum....
What Is an HSA? A health savings account is a tax-advantaged savings account specifically intended for paying health care costs. Contributing to and using the account to pay for qualified medical expenses gives you a significant discount on your health care costs, and it’s a powerful tool for retirement saving. But the penalty for using the money for other than medical purposes is steep: You’ll pay income tax on the funds withdrawn, plus a 20% penalty....
Importance of Source Documents The source document is essential to the bookkeeping and accounting process as it provides evidence that a financial transaction has occurred. During an accounting or tax audit, source documents back up the accounting journals and general ledger as an indisputable transaction trail. You would keep source documents for your business just like you keep receipts for tax-deductible items for your taxes. If your taxes are audited, the source documents provide the proof that you’ve made those purchases....
This weekly credit card news roundup contains what you should know about the cards in your wallet, other available offers, and new product announcements or reports that offered us a temporary reprieve from winter storms and falling icicles. What’s the Lowdown? Here’s what has caught our attention since our last lowdown: Spirit Airlines Expands Card Fleet to Give Credit-Builders More Runway It feels like just yesterday we were sharing details about the refreshed Spirit Airlines-branded credit cards, and now there’s another....
Education is so critical for success that many advocate that students be given the education they need to perform at an acceptable level. Equity in education is a step beyond equal education, which only promises the same level of funding. Equity in Education Without equity, education can create structural inequality. Children who don’t get that start in life won’t do as well as their better-educated peers. As a result, they will not be able to afford quality education for their children....
What do you have to offer?What makes you an expert? Do you have all of the education and skills you’ll need to compete successfully in the marketplace or will you need to get training?Does the product or service you’re thinking about meet a need?Is this a seasonal product or service, or can you market it all year long? Is it a fad or something that will last over time?How sensitive is marketing this product or service to general economic conditions?...
In addition, every Iowa taxpayer who contributes to a 529 plan can deduct up to $3,474 per beneficiary from their income for state tax purposes. That figure applies to 2021 and is adjusted for inflation every year. If a married couple has two children, each spouse can deduct $3,474 for contributions made to each child’s account, for a total of $13,896. Through these tax-deductible plans, family members and even friends can contribute to a child’s college fund and get a tax break for doing so....
Not quite. As with any other business relationship, it’s important to establish the terms under which you’ll work together to avoid conflict and possible lawsuits. This type of contract has some important terms you should include. What Is an Independent Contractor? An independent contractor (IC) has their own business or trade in which they offer their services to the general public. The general rule is that a worker is an independent contractor if the payer has control over the result of the work but not what will be done or how....
Property taxes generate the revenue that states need to keep themselves up and running and to provide necessary services to their residents. School districts tend to rely heavily on these taxes, but the revenue also funds city and state workers’ salaries—including first responders—as well as water, sewer, and other services. How Property Taxes Are Calculated A lot of complicated math is used to calculate property taxes, and states compute rates according to their own unique formulas....
With so many accounting books out there – many of them of the standard textbook variety – we found the best ones that are both practical and readable. Author Kenneth W. Boyd will teach you everything from how to set up your accounting system to working with balance sheets and income statements. There are also more advanced sections on making financial business decisions and detecting fraud, as well as other accounting niches....
Macy’s officials said this week that they expect another early start to holiday shopping this year and they might not be far from the mark. Some surveys indicate about half of shoppers intend to do just that, with some saying they’ve already gotten started amid worries about rising prices. However, many shoppers indicated they haven’t set aside the money for holiday purchases yet, and more than a fifth suggested they might take on debt or use buy now, pay later to buy gifts they don’t have the cash for....
But there may still be a certain amount of expenses that will need to be covered through student loans. The question you must ask yourself now is how much of those student loans should be your student’s responsibility and how much should be yours. Are you doing your child any favors by not involving them in the financial responsibility, or is it your obligation as a parent to take care of everything?...
Borrowing is a way of life for many consumers. Mortgages and student loans, which are often considered “good debt,” can take up a substantial part of your monthly income. Add credit card debt and a new auto loan to the mix every few years, and you can easily get in over your head. Payday loans and other toxic borrowing are almost guaranteed to lead to a debt cycle. What Is a Debt Cycle?...
The Purpose of the Board The board is the highest authority within the structure of a corporation or a publicly traded business. It owes the shareholders the highest financial duty under corporation law in the U.S., known as a “fiduciary duty.” It’s the board’s job to select and approve the right level of pay for the chief executive officer (CEO). It gauges the appeal of dividends and pays them. It may recommend stock splits....
The Standard Deduction The standard deduction nearly doubled under the terms of the TCJA. It was $6,350 for single taxpayers and $12,700 for married couples filing jointly in tax year 2017 before the TCJA took effect. It’s $13,850 for single filers in 2023, $27,700 for married taxpayers filing joint returns, and $20,800 for those who qualify for the head of household filing status. These deductions are up from $12,950 for single filers in 2022, the year for which you’ll file a tax return in 2023....
Both sides can benefit significantly from hiring a real estate agent to assist them, but their reasons can be different. And you’re probably going to have to pay a commission anyway if your buyer is represented by an agent. The buyer’s agent’s commission is typically factored into the deal—although you’ll still save on the commission you would otherwise have paid your own agent. And why not use an agent if you’re the buyer?...
