Student Aid for the College Bound

Though the 2019-20 school year has just begun, it is never too early to start thinking about college plans. If you or someone you know is planning to start college for the year of 2020-21, preparations to get federal student aid through the FAFSA program can begin as soon as October 1st. The FAFSA program gives around $120 billion to incoming freshmen in student loans every year.

Through either paper copy, the Federal student aid website, or the new myStudentAid mobile app, you can apply and learn about federal student aid and its importance. On their Facebook page, information about scholarships and deadlines are available for further reference.

 No matter what the college is, they will use this FAFSA form in order to figure out how to give financial aid to their students. Even if you believe you won’t get any aid, chances are very likely that any student will qualify for some form of it. Even so, it is advised to apply as soon as possible to maximize the amount of student aid that you get. Don’t wait until the July 30th deadline to apply for this opportunity. Schooling doesn’t have to be that one expense you stress endlessly about, for options exist  to help assist in payment as long as you look for them.



Are Your Scholarships Taxable?

Going to college is a huge step in life to broaden your horizons. With this step, comes the hurdle of funding the education.  For many, scholarships and grants make attending college a reality and because of this, the IRS is lenient on what they enforce as taxable scholarship money.  It is important to differentiate ahead of time what part of the money is defined as income, and if it will add to your tax liability to avoid a surprise down the road. 

Tax Exempt Scholarships

Generally, at an accredited college or university, students will avoid paying taxes when using their funds for basic education driven expenses. The IRS has deemed the following “qualified education expenses” that will not add to the tax liability of a student.

  • Tuition
  • Student/university fees
  • Books or any required course supplies

Taxable Scholarships

When dealing with scholarship funds, it is important to note that any left over money after the qualified expenses must be included as part of your taxable income.  However, depending on what they are to be used for, certain scholarships are subject to taxation.  Usually, these are scholarships or funds to pay for the following:

  • Room and Board
  • Utilities
  • General living expenses (bills, food)

Taxable Stipend Scholarships

Finally, the other type of scholarship funds to be aware of are stipends.  Stipend Scholarships are viewed as compensation for services you will provide in the future.  For example, you can receive a $5,000 stipend with $2,000 designated to pay for your services.  The $2,000 will be viewed as part of your taxable income, and the other $3,000 is tax exempt scholarship money.  These types of scholarships are common for teaching and military services. 

If you received a scholarship towards your education, it is important to find out the tax stipulations immediately.  If part of your scholarship is subject to taxation you will usually receive a W-2 from the provider describing the taxable portion, and you can report this using Form 1040. 


Beware of Popular Tax Scams

While tax season may only be three and a half months long, scammers are working constantly all throughout the year, to take advantage of honest taxpayers.  It is important for anyone filing taxes to know the signs of suspicious activity, as these scams can evolve every year.  If you feel like you were targeted by potential criminal activity it is important to contact the IRS immediately and report it. 

Phishing

A phishing scam is an extremely popular attempt to fraudulently gain access to a taxpayers’ personal information.  Phishing is generally done through email, and can be rather tricky for one to identify as the email will appear to come from a well-known source.  The IRS will never initiate contact with requests for personal information through email or text message.  If you feel you have received a suspicious email regarding tax information, follow these guidelines.

  • Never reply to any suspicious emails requesting personal information
  • Do not open any attachments or follow any links within the email
  • Forward the email as is, including all headers to phishing@irs.gov and the FTC at spam@uce.gov
  • Phishing text messages can be reported to “SPAM” (7726)
  • Delete the email/text message off of your computer and mobile device

Phone Scams

Another frequent scam attempted is over the phone.  Most popularly a caller will pose as an IRS or treasury worker, and try to solicit money out of unsuspecting tax payers. The caller will generally inform the victim of a debt that they owe and request a payment over the phone.  It is important to remember the IRS will always initially contact you through a mailing.  If you think you are being targeted through a scam over the phone, reference the list below to protect yourself and your finances. 

  • Ask the caller for their name, employee badge number, and make note of any other specific information regarding the call (time, date, phone number)
  • Review your account information online and reference with the information provided for you over the phone
  • If you suspect the communication to be fraudulent, report it by email to phishing@irs.gov and also file a complaint with the Federal Trade Commission

Natural Disasters

Taxpayers should also beware of scams that occur around areas affected by severe weather.  For example, after Hurricane Florence and Harvey, 2018 saw a rise in these crimes across America.  Scammers tried to pose as legitimate charitable organizations, over the phone and online to beseech funds from people trying to help those in need.  On the other hand, scammers will pose as an IRS worker and reach out to victims to file fraudulent loss claims.

  • Contribute to charity through check or credit card – avoid using cash
  • Be cautious of organizations soliciting donations and asking for personal finance information
  • Reach out and identify the organization on your own through the IRS websites Tax Exempt Organization Search (link)

The TCJA and You

With less than a month to go in the tax filing season, many Americans have already seen the effect that the Tax Cuts and Jobs Act (TCJA) is having on their bottom line.  In practice for the first time since being approved in December 2017, this new tax act is impacting everyone. Many people are finding minor decreases in their refunds or increases in their payment due.  Tax preparers are spending a little more time working through questions and concerns with clients. So who is being impacted and what, if anything, can you do to improve your situation for next year?

TCJA and you Photo by Sharon McCutcheon on Unsplash

The biggest impacts are to those with children and those who typically itemize deductions.  Homeowners are seeing a definite change in tax refunds as well. The variation to your tax return depends upon so many different details it is almost impossible to give examples of every one.  Filing status, income level, number of dependents, and whether or not you own a home all come into play in a variety of ways. Here are some common areas that are impacting most people.

The elimination of the personal exemption touches everyone but hits families the most.  At $4,050 per person, for a single taxpayer, this might not be a big deal. But for a family of 4 – this means $16,200 MORE of your income is taxable since the personal exemption is gone.

However, the increase in the standard deduction does a good job making up for the personal exemption loss.  At $24,000 for couples filing married and $12,000 if you are a single filer, this increase is all but equaling out the personal exemption for many.  The child tax credit has increased, further helping families. An additional equalizer in many cases is the lowered income tax rates across tax brackets.  

The net result of these changes is bringing many taxpayers within  close range of how their 2017 tax refunds looked. However, the end of itemized deductions is an area that is also having an impact.  Homeowners are especially noticing a change in their bottom line. How much you can deduct for home mortgage interest and home equity loan interest has been limited. Under the new tax laws, the amount you can deduct for state and local tax deductions is $10,000. This hurts taxpayers who would itemize their state and local income, property, and general sales tax payments on their federal tax returns. The TCJA eliminates the deduction for home equity loans.

So how do you prepare for next tax season?  The IRS continues to recommend doing a paycheck check-up.  The IRS has all the tools to complete a check-up on their website.  It’s also a good idea to talk to a financial advisor or tax preparer to plan ahead for next year.  If possible, wait until after the filing deadline when your tax preparer has time to sit down and think.  We would be happy to help!


Protecting Yourself this Tax Season

Every tax season brings a new post on how to avoid scams.  Redundant but relevant, as this is the time when scammers prey on taxpayers.  We provided some basics last year in Tax Scams.  If you don’t have time to read much further, know these basic tips:

  1. Never give out your Social Security Number to someone who calls you.  Ever.
  2. The IRS will never contact you by phone to demand money.  Ever.
  3. The IRS will not threaten  police action or ask for credit/debit card numbers over the phone
  4. The IRS will not call about an unexpected refund.  You are being scammed.

The IRS will communicate by letter through the mail.  If you need to contact them, they can be reached at 800-829-1040.  The IRS Is protecting consumers in several ways, so when you place that call be prepared to supply:

  • Social Security numbers or ITIN and birth dates for anyone on the tax return
  • Filing status
  • A copy of the tax return in question
  • Any IRS letters or notices received by the taxpayer

If you are contacting the IRS on behalf of another person you will need to complete Form 8821 and Form 288.  These will give Power of Attorney and Tax Information Authorization. If the other party is deceased then a copy of the death certificate and Form 56 are required.

What do criminals do with the information they steal?  Withdrawing money from bank accounts and using credit or debit cards for purchases are among the typical crimes.  Also common are selling the stolen information or filing a fake return io claim the money. Knowing how the stolen information is used, there are several important steps to take immediately after you suspect you’ve been victimized to minimize damages

  1. Figure out what information was breached.
  2. Utilize credit bureaus to determine the extent of the damage.
  3. Contact credit card companies and your bank to re-establish new accounts and freeze old ones.
  4. Reset all passwords.

For more information about protecting yourself and your investments, visit Tax Scams and Consumer Alerts.


Gambling and Tax Laws

If games of chance such as poker, horse racing, or playing the lottery are among your recreational hobbies, the new tax law brought some minor changes.  The IRS website includes a description of changes as they relate to each type of gambling.  It is the best place to verify current and future tax law plans, but the two biggest impacts are described below as well.

How Gambling Affects Taxes

The change that affects the most gamblers and therefore is the one most talked about, is how losses can be deducted.  While many types of itemized deductions were eliminated under the new law, gambling losses are still allowed! The change to these deductions is that they can only be deducted to the extent of gambling winnings for that tax year.  

At year-end, calculate all your losses.  Everything from non-winning lottery and bingo ticket costs to money spent and lost on slots.  You can then claim an itemized deduction for all these betting losses throughout the tax year, against your winnings.  For example, if you spend and lose $10,000 and win $9,000 during the year, you could deduct for the $1,000 difference.  If you lose $10,000 and win $11,000 you would be responsible for taxes on the $1,000 difference.

The increase in the amount of the standard deduction may make it more attractive to many taxpayers over taking itemized deductions.  Gamblers too may find taking the standard deduction a more beneficial decision than itemizing losses. If your losses are greater than the standard deduction amount than itemizing is likely your best choices.  Otherwise, take the standard deduction or talk with your tax preparer.

The tax law also includes changes for professional gamblers.  Expenses for travel, lodging, food, and the like are lumped in with losses now for deduction purposes.  These expenditures can no longer be separately itemized. Small time gambling hobbyists will be the ones most likely to still see returns under the new law, while gambling professionals are not going to be so lucky.

Do you have additional questions about gambling under the new tax law? Contact our office today and we will get you the answers……you can bet on it!


Get in Shape with Bull Ridge Fitness

Daylight savings time is, thankfully, upon us.  The days are getting longer, warmer and people are beginning to think about getting in shape for summer.  If you are looking for a great way to tone after a long cold winter, check out Bull Ridge Fitness, LLC.  Conveniently located in Willow Street, Bull Ridge is celebrating 2 years in business this week!  

Gym owner, Chris Martin, has been cross training for 8 years and during that time did some coaching at a local gym. When that gym went out of business, Chris continued working out at her home.  What began as working out with friends in her garage expanded into a business with many loyal customers. Chris shares that her favorite part of her job is helping people change their lives for the better.  She says of Bull Ridge, “Our mission is MOVEMENT. For each person that is at a different level. We meet you where you are at and make amazing things happen. We build strength in functional movements.”

Bull Ridge is a group training facility which offers the advantages of personal training in a team environment.  Each individual completes the same workout at their own level. Everyday brings a new 1 hour long workout. This time includes a warm-up, skill/strength, workout of the day (WOD), and mobility/stretching.

We know that joining a gym can be daunting for many reasons.  Bull Ridge offers a 1 week free trial so customers can come make sure that the fit is right for them.  We’re pretty sure you will want to stay! To get in touch with Chris directly her email is chris@bullridgefitness.com  The gym can also be reached at 717-587-5629 and their website is well designed to help answer many of your questions!

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“ITP, LLC is supporting local small business owners through this post.  The experiences described are personal to particular users, and may not necessarily be representative of all users of the products and/or services.  We do not claim, and you should not assume, that all users will have the same experiences. Your individual results may vary. We are not affiliated with the organization referenced and are not paid or compensated for this publication.”


Welcome Home With Lancaster Transplant

Being new to an area can be hard.  How do you meet up with people who share the same interests when you are in an unfamiliar home?  Where do you go for the best Mexican food and a fun scene? This is where Jocelyn Park and Lancaster Transplant can help.  Jocelyn began Lancaster Transplant five years ago and the group has grown in many positive directions since then.  

Lancaster Transplant offers the community a way to get connected to their new home and neighbors.  This organization is open to ANYONE who is looking to meet new people, not just Transplants to our area.  Their website has a wealth of information available, including what being a member entails.  Transplants meet up regularly for drinks, bike rides, field trips and other fun adventures.

Jocelyn came to Lancaster with undergrad and graduate degrees in Design.  Her experience as a transplant to Lancaster, combined with her design expertise, help in dreaming up big ideas  As a visionary, she enjoys leading a team of talented people to figure out how to bring these plans to fruition.  The Lancaster Transplant team is constantly thinking of ways to make people feel more at home in Lancaster. Interested in making connections of your own here in Lancaster?  You can call Lancaster Transplant at 717.925.0562 or email at hello@lancastertransplant.com.

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“ITP, LLC is supporting local small business owners through this post.  The experiences described are personal to particular users, and may not necessarily be representative of all users of the products and/or services.  We do not claim, and you should not assume, that all users will have the same experiences. Your individual results may vary. We are not affiliated with the organization referenced and are not paid or compensated for this publication.”


Starting Over: Career Change

A growing trend in today’s job market is for workers to change careers at least once.  There are a multitude of explanations for these changes. A big reason is being able to try out a career that didn’t exist years ago.

Technological fields such as social media and cyber security are some of the largest growing areas. Another reason for increased job switching is the rate that companies are downsizing, closing, or relocating.  

Initially upsetting, these misfortunes can lead to great opportunities to look in a new direction! Many women who return to the work world after having children find that having a schedule that coordinates with their kids’ school schedules is more important than making big bucks. Still, others find themselves at the other end of parenting after children have moved out.

Now can be the time to take on the new career that you’ve been wanting to try but were worried about job security as you raised a family. Perhaps you don’t need quite as much income, as many work hours, or the stress that comes along with all of that.

Even as the career change trend shows an increase, surveys show that while a large percentage of older workers wish to change careers for many of the reasons mentioned, less than 10% of them will make a change.  However, the vast majority of those who do make the switch report being very satisfied and successful in their new career. So how do you successfully make the switch?

Talk to family, friends, and professionals in the new career. LinkedIn is a well known online tool for meeting and talking with professionals across job sectors. Career counselors can also be a valuable asset. List the skills, training, perspective, and experience that you’ve acquired over the years that can make you valuable in a new position.  Research what additional training you would need to enter the new field. An online search of available training is a great place to start as is talking to those currently working in your desired field.  

If you are someone who tends to be adverse to risk, consider options to enter your new career part-time to start, while still holding on to the security of your full-time position. Last, plan your budget to determine what you truly need to earn to make ends meet.  Be honest during this phase of the planning and check out “Your Family Budget” for tools to help set-up and stick with a new budget.

Finally, time to polish off that resume!  Monster.com provides a free resume review.  This can be a great place to start if you’re updating for the first time in several years.  Utilize friends and family to practice interviewing skills.

The Muse shares 31 Common Interview Questions, along with tips on how to answer them!  When interviewing, let it be known that you are switching careers because you’re passionate about the field you are entering.  Your enthusiasm and energy, combined with the skills and experience gained in prior careers will make you an attractive candidate!


Zoetropolis Cinema Stillhouse

Did you know that Lancaster City has its own movie theater?  For over 20 years Zoetropolis Cinema Stillhouse has been serving up great independent films and treats to patrons.  They have moved twice since first opening their doors in the 90s and their current home is one you shouldn’t miss!

Zoetropolis – more than just movies!

Zoetropolis is newly re-opened at 112 N. Water Street, operating under a new model – the Cinema Stillhouse. It’s a unique balance of different things including a theater/restaurant/distillery combo. The building space itself is shared with two other local businesses – Columbia Kettle Works and La Cocina Mexicana.  Although they remain independent entities, these three local businesses compliment each other very well!

Zoetropolis offers outstanding alternative film content that they’ve become well known for…art house film, independent, documentary and foreign films. They are beginning to add more live music events to their calendar.  Currently, Zoetropolis is featuring 1-2 nights of live music performance per month, when the whole place transforms into a fantastic concert venue. Other live events that can be found at Zoetropolis include The Lancaster Story Slam and Lanc Out Loud Comedy nights.

What’s new, besides the fabulous location and live music?  They are on the brink of opening their own restaurant and distillery. Their distiller is excited to be sharing his own quality spirits with the initial offerings including vodka, gin and rum. The restaurant will offer a shared plates menu and when the weather is nice, their large garage doors will lift to allow for outdoor courtyard seating.

Zoetropolis is not like just any other movie theater.  Films are carefully selected for content and substance.  Movies are shown that bring value and meaning, artistic relevance, and a social connection – making you think in new and interesting ways.  The experience is enhanced further by the viewing environment. The theater offers comfortable seating to hang out afterwards allowing patrons to discuss and process while still completely in the moment.

For an upcoming list of movies and events, hours and pricing, refer to their website.  To get in touch with someone personally, email is the best means at info@zoetropolis.com

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“ITP, LLC is supporting local small business owners through this post.  The experiences described are personal to particular users, and may not necessarily be representative of all users of the products and/or services.  We do not claim, and you should not assume, that all users will have the same experiences. Your individual results may vary. We are not affiliated with the organization referenced and are not paid or compensated for this publication.”