Low Income? Know These Tax Facts

Even if you believe that filing your federal tax return should be a straight forward process, involving little in the way of income or deductions, you should familiarize yourself with some of the current tax rules that could greatly reduce your tax bill–or increase your refund substantially. For instance, those who found themselves jobless for any part of the previous year may be able to deduct job hunting expenses or maybe even interest for a prepaid credit card for job search expenses.  Additionally, moving expenses when related to a job may also be deductible. Other important deductions include mortgage interest, property taxes paid and student loan interest.

Tax credits are even better than deductions, since the deduction is subtracted from your income while the credit is subtracted directly from your tax bill. One such tax credit is the Child Care tax credit, which can be taken regardless of whether you use an employment sponsored savings program. If you must pay for child care in order to work or go to school, you want to make sure to calculate this credit. The American Opportunity Credit is another item you should investigate if you paid college tuition in the previous year.

The Making Work Pay credit can reduce your tax bill by $400-800, given income limits and filing status. Those who purchased or refinanced a home in 2010 have two other credits and deductions to look into; additionally, energy saving home improvements may also be eligible for a tax break. Finally, the Earned Income Credit is still a very important tax credit for low income families. Those who have at least one qualifying child will benefit the most from this credit, but every person filing a federal tax return should take the time to determine their eligibility for this. Paying less in taxes–or getting more back in your federal income tax refund–means more money for your family to live on and invest in your future.

Filed Under: Financial Tagged With: ,

The Stress of Debt and Health

Bankruptcy is a very scary word. Mention it to someone who is in legal trouble and the response you get can be just as scary. Filing for bankruptcy in short is the inability to pay your bills and outstanding debt. It’s surrendering to your debt. It’s not the first choice, but it is sometimes a necessary measure to protect yourself from further legal and financial trouble.

One of the ways that people find themselves in the most trouble with debt is when it comes to medical debt. Many people these days are dealing with serious medical illnesses, and many don’t have the insurance it takes to cover these bills. After treatment the bills can add up. While you might be doing your best to pay for it, the truth is that it’s not always easy. If you have a pre-existing condition you might find yourself in further trouble, because getting insurance with a pre-existing condition is near impossible currently.

So, if you have found yourself with far more debt than you can handle and there are people looking for their money and threatening legal action, then here are some things you can do to help yourself. The first step is finding a helping hand. Bankruptcy is not something that can be, or should be, handled alone. Seek the help and advice of trained professionals.

You should know that your bankruptcy is a process. There is plenty of paperwork to be filed when it comes to your income. You will also be required to submit to credit counseling. You must get educated before anyone is going to give you the help you need. The good news is that there will be relief for those with pre-existing conditions. The new healthcare bill will cover those with preexisting conditions. There may be help coming in more ways than one.

Filed Under: Financial Tagged With:

War in Iraq Hurts and Helps US Economy

There are two different schools of thought in the financial community concerning whether wars and other military actions hurt or help the U.S. economy. In truth, both sides have some valid considerations. Sometimes the  reactions of a nation include things that boost an economy. For instance, World War II, following the Great Depression, created a large number of jobs, boosted the industrial industry and many more citizens to work. The same can be said for some of what is happening today. Additionally, those who are enlisted in military reserve units must vacate full time jobs when they are called out to serve, creating job openings for others left here at home.

On the other side of the issue, our economy is taking a hit from the amount of money that must be spent on social programs and other related items. For instance, the Veteran’s Administration requires much more funding to help those who were injured or disabled during their tours of duty. The loss of lives also means the loss of a parent or bread winner for many American families, sending more of them to government assistance programs for aid. All of this government expenditure takes a toll on the taxes paid by those who remain at home and employed; more taxes taken from a paycheck means less money for families to spend in discretionary income.

There are other considerations that show how being involved in military actions overseas are hurting the economy at home. Our national debt continues to grow, because our resources are not able to keep up the pace of spending that a war of this length demands. The funds spent on helping those families negatively affected is not able to be invested in ideas that would have helped our economy and the larger community of our nation. There is little doubt that the damage to our economy has been done; the only question remaining is how much worse it will have to get.

Filed Under: General Tagged With: ,

WIC for Healthy Kids

The acronym WIC actually stands for a much longer name: Special Supplemental Nutrition Program for Women and Infant Children. As the name implies, it is a program managed by the federal government’s Food and Drug Administration to help provide assistance to needy children and breastfeeding or pregnant mothers. WIC has been providing assistance to these individuals since the mid 1970s. Basically, those who qualify for other types of government aid like Food Stamps, Medicaid, or TANF automatically qualify for this program as well. The aid is typically distributed to women in the form of an electronic card, much like a debit card, that can be used in any grocery or supermarket electronic card reader. Alternatively, some states still issue checks that can only be issued for the purchase of certain food items.

Most people automatically think of milk and baby formula when they hear the term “WIC,” but the program is actually designed to provide much more. In addition to those basic nutritional needs, WIC also provides assistance for the purchase of many breakfast foods like juice, eggs and cheese, as well as other items like peanut butter and cheese. For those who are unable to drink normal cow’s milk, the program also applies to soy based products like soy milk and tofu for protein and calcium.

There are rules to the products that can be purchased by the WIC program. Those taking advantage of the benefit are required to purchase the least expensive brand of the product, typically a generic or store brand. In addition, there are limits to the quantities that can be purchased at any given time. Do to the use of electronic cards, much of the historical abuse of this assistance program has been eliminated. Recipients are no longer able to sell checks or vouchers for less than face value to those who do not qualify for the program, or who may have exhausted their benefits for a given period.

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Qualifying for Food Stamps

F​ood stamps are the currency of a federal assistance program for low income and other needy families. As the name suggests they are used to purchase food from any grocery or supermarket. Many other types of stores that also sell non-prepared food items will accept food stamps as a form of payment. Applications to apply for the food stamp program are available from your local social security office. Staff members there are able to help explain the program and eligibility requirements to you, as well as help you fill out the necessary forms and provide the backup documentation.

Adults between the ages of 18 and 60 will probably be required to register for a work program in order to qualify for food stamps, unless they are disabled or already currently employed. I​t is important for parents to understand that their children may qualify for the program, even if they as adults do not. These rules can be tricky and are best explained by a qualified federal employee. Generally, your income and the amount of resources that you have, otherwise known as your real assets, are the main variables in qualifying for food stamps.

Recent technologies also apply to the way benefits are distributed by government assistance offices, as well. Social security offices no longer issue paper “food stamps” to be used as currency; instead, qualifying individuals are issued a card that is used like a debit card in electronic readers. This has done much to combat abuse of the program, such as the selling of food stamps to other individuals for less than face value in order to receive the cash. Recipients of the food stamp program also have more privacy with this program, as others in line at the grocery store won’t know what method of payment the recipient is using. Removing the stigma from government assistance is a huge step forward in helping families in need.

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W​hat is Medicaid?

If you are like most Americans, you have probably heard of this government assistance but are unsure exactly what it means. What medical benefits are provided by Medicaid? Who qualifies for this assistance? The answers to these and other questions often vary by state, but there are some common guidelines available for all U.S. citizens. The federal government offers a website that will help you determine your eligibility by answering several questions. Briefly, Medicaid pays for preventative and corrective medical services and prescription medication.

Some of these questions include your age, marital status, number of children and whether or not you are pregnant. Other questions concern any disabilities you may have and your current employment status. It may be that your minor children qualify for Medicaid, even if you as an adult do not. It is important to understand that with this many variables, determining eligibility for Medicaid and other government assistance programs is a relatively complicated process. Most states have offices staffed with professionals who can help you with your application for aid.

Other instances that may determine eligibility for Medicaid include special needs individuals who are institutionalized, those who are drawing social security benefits due to loss of parent or spouse, elderly persons who reside in an assisted living facility and recipients of Aid for Families with Dependent Children (AFDC), even if those recipients may not otherwise qualify for Medicaid. Because there are so many different variables and rules for the eligibility and benefits of this assistance program, all individuals who have need or believe they may qualify are urged to contact the local social services office for their specific state and county. Counselors and staff members there are trained to help people complete the applications and understand the benefits to which they are entitled. You should not assume that unemployment or limited income automatically qualifies you, just as you should not assume that because you do have a job, you will not qualify.

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Spending Tax Money On Health-Care

With the development in the field of science and technology, the health-care system has seen massive changes in the recent past. Inventions and innovations have become the order of the time and with them the health-care system is progressing in leaps and bounds. However with medicines and other medical facilities becoming costlier day by day, it has become almost unreachable for the poorer section of the society. All these progresses become useless if they are not able to reach to the majority of the people. The government should ensure that the country is not crippled with such a situation wherein only a selected few can enjoy the advances made in the field of health-care.

A part of the tax which the countrymen give goes to the health-care fund of the government. It is necessary for the government to utilize it in a proper way. Many of the countries in the world faces severe problems in providing the proper health-care facilities to its citizens. Medical insurance still remains out of reach of a large segment of the population. In certain cases it was seen major operations and treatments were not done by the hospitals as the patients didn’t have the requisite medical insurance. With so many new diseases coming to the forefront every other day, it is the responsibility of the government to provide medical insurance at a rate which will be affordable for everyone. Along with medical insurance, the cost of medicines is another factor which should be noted and action should be taken at the earliest. Medicines for almost all diseases are available nowadays, but what is their use if people are not able to buy and use them. Government should undertake a complete overhaul of the health-care system if it wants its citizens to remain content and happy.

Filed Under: Financial, Income Tax Tagged With: ,

Spending Tax Money On Charities

The citizens of a country play a significant role in the various developmental activities of a country, be it in a direct way or indirect way. There are a lot of people who actively participate in the different developmental projects implemented by the government. The majority of the people are not able to help the country in such a direct manner. It is the tax which they give in different formats that are used by the government to undertake several developmental projects in different areas.

The tax accumulated from the people is used for several purposes like education, defense, health-care, charities to name just a few. In a society where resentment is increasing due to the growing difference between the rich and the poor, charity is something which is needed to a great extent. This is not the only problem which plagues the growth and development of a country. There are many other issues like child labor, female infanticide, women’s education which are equally bad for the improvement of the country. It is the duty of the government to take a not of such issues and do whatever is possible to eliminate them from the society.

The government should create institutions dealing with the various problems and provide them with all the facilities in order to make their working fruitful. A section of the huge wealth gathered in the form of taxes can be used for improving the conditions of the people who are facing different problems. Charity is something in which the entire country should be involved. It is not the job of the government alone to look after the charities of the country. The government should mobilize people to participate in such activities on a more regular basis. Hence the government plays a crucial role in creating the apt atmosphere for charities inside as well as outside the country.

Filed Under: Financial, Income Tax Tagged With: ,

Spending Tax Money on Education

Education is one aspect which is of primary importance for the government as well as the people of the country. People from all across the world emphasize the need of education not only for personal development but also for the growth of the country. A lot of money is accumulated in the form of tax by the government which is then used for the development of the various spheres of the country. One such area in which a lot of money is spend is the education of the country. On the other side, if we have low income and need to study further, we have options like online degree programs, which are really helpful in continuing studies.

The progress and development of the education system is extremely necessary to cater to the growing demand of the fellow countrymen. Nowadays, people are more aware about the importance of education and hence want the best possible facilities from the government in that sphere. Modern means of education, more research and development and innovative ways of making education more attractive for the people has become necessary. Innovations and changes are taking place every other day in the field of education. It is the duty of the government to incorporate all those modern ideas and changes so that the system does not become stagnant. With the increase in the population of the country, it is also important to increase the number of government aided schools, colleges and universities.

Higher education is not now limited to the classroom format. Government should utilize the tax fund in developing the various other ways of getting higher education like online education, part time education, technical education, community education and collaborative education. These modern ways of imparting education are becoming popular day by day. It is hence important for the government to boost such formats so that more and more people are able to reap the benefits of higher education. The fund should also be used for opening schools in the rural areas and countryside so that people of those areas do not miss on receiving education.

Filed Under: Income Tax Tagged With: ,

Spending Tax Money

Tax is something which is required by every citizen of the country to pay to the government. A certain proportion of the income of every person goes into the fund of the government as tax. There are various tax slabs which are implemented by the government. It is generally seen higher the income higher is the tax. The money which is being accumulated by means of tax is utilized in the growth and development of the different areas under the purview of the government.

A country is made up of many things and it is important for the ruling government to take care of those things. There are arenas which are looked after by the government for the benefit of country in times of emergencies. The tax which is taken from the citizens of the country are distributed and used for the development of those areas. One such area is the defense of the country. It is one of the most crucial areas of the government which needs constant focus and attention. The major chunk of the tax is used for the improvement and enlargement of the defense of the country. Internal and external disturbances can occur at any point of time. the government should always be ready to face such a situation.

Hence it is important to constantly upgrade the defense equipment and machineries on a regular basis. The tax money gathered is mainly used for the purposes of buying new arms and ammunitions, upgrading the old ones and also implementing a complete overhaul of the entire defense system. Along with defense there are also areas of government focus like health-care, education and charities where a large part of the tax amount is spend. All these areas form the basis on which a country runs. Hence proper care and constant improvement is necessary in those spheres. It is the tax money which is used for the fulfillment of those purposes.

Filed Under: Income Tax Tagged With: ,
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