Bad spending habits can cost you in the long run. Take a look at these common spending behaviors and find out how you can save more cash for yourself.
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May Moneybags Tips
May flowers have been blooming all month. Here’s five tips to help you grow more money for your tree.
1. Adjust your tax withholding now. If you wait to get that big refund at the end of tax season, you’re missing out on that chance for that money to earn some interest. Use the IRS Withholding Calculator to make sure the right amount is being withheld.
2. Clean out your closet and consign good condition, unwanted clothes and accessories.
3. Clip and use coupons when shopping.
4. Eat more meals at home. You can save a ton by not going out to eat.
5. Find free stuff to do in your city. Visit your town’s website and see what free events are going on in your neighborhood.
What tips do you have for saving money?
It’s Tax Day! If you haven’t filed yet, take a look at our products to help you get them done so you can relax, worry-free.
Eight Facts on Amended Returns
- Use Form 1040X, Amended U.S. Individual Income Tax Return, to file an amended income tax return.
- Use Form 1040X to correct previously filed Forms 1040, 1040A or 1040EZ. An amended return cannot be e-filed; you must file it by paper.
- Generally, you do not need to file an amended return to correct math errors. The IRS will automatically make that correction. Also, do not file an amended return because you forgot to attach tax forms such as W-2s or schedules. The IRS normally will send a request asking for those.
- Be sure to enter the year of the return you are amending at the top of Form 1040X. Generally, you must file Form 1040X within three years from the date you filed your original return or within two years from the date you paid the tax, whichever is later.
- If you are amending more than one tax return, prepare a 1040X for each return and mail them in separate envelopes to the appropriate IRS campus. The 1040X instructions list the addresses for the campuses.
- If the changes involve another schedule or form, you must attach that schedule or form to the amended return.
- If you are filing to claim an additional refund, wait until you have received your original refund before filing Form 1040X. You may cash that check while waiting for any additional refund.
- If you owe additional 2011 tax, file Form 1040X and pay the tax before the due date to limit interest and penalty charges that could accrue on your account. Interest is charged on any tax not paid by the due date of the original return, without regard to extensions.
What you need to know about making federal tax payments
1. Never send cash!
2. If you file electronically, you can file and pay in a single step by authorizing an electronic funds withdrawal via tax preparation software or a tax professional.
3. Whether you file a paper return or electronically, you can pay by phone or online using a credit or debit card.
4. Electronic payment options provide an alternative to checks or money orders. You can pay taxes or user fees 24 hours a day, seven days a week. Visit the IRS website at www.irs.gov and search e-pay, or refer to Publication 3611, Electronic Payments for more details.
5. If you itemize, you may be able to deduct the convenience fee charged for paying individual income taxes with a credit or debit card as a miscellaneous itemized deduction on Form 1040, Schedule A, Itemized Deductions. The deduction is subject to the 2 percent limit.
6. If you file on paper, you can enclose your payment with your return but do not staple it to the form.
7. If you pay by check or money order, make sure it is payable to the “United States Treasury.”
8. Always provide on the front of your check or money order your correct name, address, Social Security number listed first on the tax form, daytime telephone number, tax year and form number.
9. Complete and include Form 1040-V, Payment Voucher, when mailing your payment to the IRS. Double-check the IRS mailing address. This will help the IRS process your payment accurately and efficiently.
What the IRS wants you to know about IRAs
Here are the top 10 things the IRS wants you to know about setting aside retirementmoney in a traditional IRA.
- You may be able to deduct some or all of your contributions to your IRA. You may also be eligible for the Savers Credit, formally known as the Retirement Savings Contributions Credit.
- Contributions can be made to your traditional IRA at any time during the year or by the due date for filing your return for that year, not including extensions. For most people, this means you must make contributions for 2011 by April 17, 2012. If you contribute between Jan. 1 and April 17, you should designate the year targeted for the contribution.
- The funds in your IRA are generally not taxed until you receive distributions from it.
- Use the worksheets in the instructions for either Form 1040A or Form 1040 to figure your deduction for your IRA contributions.
- For 2011, the most you can contribute to your traditional IRA is generally the smaller of the following amounts: $5,000 for most taxpayers, $6,000 for taxpayers who were 50 or older at the end of 2011 or the amount of your taxable compensation for the year.
- Use Form 8880, Credit for Qualified Retirement Savings Contributions, to determine whether you are also eligible for a tax credit equal to a percentage of your contribution.
- You must use either Form 1040A or Form 1040 to deduct your IRA contribution or claim the Credit for Qualified Retirement Savings Contributions.
- You must be under age 70 1/2 at the end of the tax year in order to contribute to a traditional IRA.
- To contribute to an IRA, you must have taxable compensation, such as wages, salaries, commissions, tips, bonuses, or net income from self-employment. If you file a joint return, generally only one spouse needs to have taxable compensation. However, see Spousal IRA Limits in IRS Publication 590, Individual Retirement Arrangements, for additional rules.
- Refer to IRS Publication 590 for more information on contributing to your IRA account.
