This fall, we provided information on planning for college through the ITP blog in Time to Apply! and Back to School. “Time to Apply!” looked at Federal Student Aid which is now open for the 2018-19 school year. In “Back to School” we explored tax credits, deductions, and tuition plans that are available to students.
Today, we want to introduce you to a Financial Advisor who specializes in college planning and 529 plans. Daniel Cieniewiz has been working at 1847Financial for 3 and a half years. 1847Financial has advisors who can help with retirement planning and group benefit plans for businesses, but Daniel has found his passion in helping families prepare for the large expense of college. Daniel can appreciate the amount of time and capital spent in the pursuit of a secondary education and he takes pride in helping to make this expense more manageable for his clients.
1847Financial is located in Shillington, PA with offices throughout the mid-Atlantic. Daniel and his team are centered in Reading where he is able to focus on Berks and Lancaster County. Daniel can show clients ways in which they can save for college and he enjoys the relationships he has been able to establish over the past 3+ years.
If you, or someone you know, is at the college planning stage of life, Daniel is there to help with the process. He can be reached at his office at 610-741-6577 and more information about 1847Financial can be found on their website.
Registered Representative of, and Securities and Investment Advisory Services offered through Hornor, Townsend & Kent, Inc. (HTK). Registered Investment Advisor, Member FINRA/SIPC. 1847Financial, 161 Washington Street, Suite 700, Conshohocken, PA 19428. Phone: 610-771-0800. 1847Financial and ITP Taxes is unaffiliated with Hornor, Townsend & Kent, Inc.
As tax time rolls round, there are several questions I hear more regularly. One common query is whether a client should itemize deductions or take the standard deduction. Before answering that, I thought it would be helpful to take a look at the difference between exemptions, credits, and deductions.
Exemptions – reduce your taxable income as a result of the people in your family including yourself, spouse, children, and any other dependents.
Deductions – also reduce your taxable income and are for things you did like making charitable contributions, student loan interest, tax preparation fees, and retirement contributions.
Credits – reduce your tax bill for things such as continuing education, earning a low income with the Earned Income Tax credit, child tax credit, improving your home with energy saving measures, or buying an electric car.
Exemptions and deductions are similar in that they take the amount of income earned and reduce it, creating a lower overall taxable income. Credits don’t change your taxable income, but they are helpful in reducing the amount owed or increasing the amount of your refund.
The standard deduction is most common for several reasons, but mainly because it is the easiest option. A standard amount is offered, depending on your filing status, and this amount reduces your total taxable income by the following amounts in 2017:
Single or married filing separately — $6350
Married filing jointly or qualifying widow(er) — $12700
Head of household — $9350
Taking the standard deduction saves time throughout the year as it means not needing to save expense paperwork. Standard deductions are also perfect for the taxpayer who does not accrue deductible expenses during the year. Most taxpayers will ultimately take the simpler standard deduction when filing, but itemizing your deductions can result in bigger tax savings. Ask your tax preparer to take a look at the deductible expenses you paid in 2017. Such expenses include unreimbursed medical expenses, home mortgage interest, and gifts to charities. Comparing this number with your standard deduction can help to make the most informed decision.
If you have questions regarding taxes, my door is open!
Being married doesn’t mean you have to file a joint tax return with your spouse. Choosing to file as “Married Filing Separately” means that you each claim your own income, deductions or exemptions, and credits on your own tax return.
In general, filing a joint return as a married couple yields a larger return, or smaller tax payment. This occurs for several reasons. Larger standard deductions and credits are available to those filing a joint return. Couples filing together can claim two exemptions and multiple credits. Most of these credits are those realized by couples with children, college students, and the elderly. Examples include:
child and dependent care tax credit
tax-free exclusion of Social Security benefits
credit for the elderly and disabled
deduction for college tuition expenses
student loan interest deduction
The American Opportunity Credit and Lifetime Learning Credit for higher education expenses
So why would a married couple or spouse chose to file separately? One of the biggest reasons is that you are not responsible for any tax liabilities and penalties that your spouse incurs. If you have any reason to believe that your spouse will have a large tax bill, filing separately waives your responsibility to this debt. Along these same lines, some spouses like to keep their finances separate and therefore may chose to file separately to maintain that goal.
The other major advantage of filing separately will relate to anyone with large deductions or expenses that couldn’t be realized if a joint return is filed. Medical expenses are a primary example of these large deductions along with unreimbursed business expenses or large charitable contributions.
The decision to file a joint return or separate returns will be unique to each couple. If you are looking for the largest possible return and hoping to receive several credits, then a joint return will tend to be your best option. If you have large expenses to deduct or are nervous about your spouses’ tax bill, then it might be better to file separately. The best person to help you navigate this choice is a tax preparer who can compare your options and help you make an informed decision.
The holiday season is right around the corner, and no – we aren’t talking about tax season for once! Now is the perfect time to order pies, cupcakes, whoopie pies, cake pops, and other delicacies for all those office parties and family gatherings!
But how do you chose when there are so many bakeries in Lancaster County? Sugar Whipped is based in Lititz, PA and is known for using local, all natural ingredients with no artificial flavors. They are popular for their vegan and gluten free offerings and their whoopie pies have received some of the best reviews in Lancaster! Sugar Whipped offers exotic and fun cupcake flavors like Maple Bacon Stout and Irish Car Bomb. To check out the full line of monthly cupcake flavors, check out the Sugar Whipped website. Or, if you have your own ideas in mind, they are happy customize for you.
Don’t procrastinate – order today! Specialty and vegan or gluten free orders require a 7 day window and for regular cupcakes 2 days is requested. It’s easy to get in touch with Sugar Whipped. They are available by:
In Protecting Your Tax Return we looked at filing a return early this year to protect against identity theft. This remains a very important reason to file early, but are there other benefits to be gained as well?
Filing early means getting your tax return early – and who couldn’t use some quick cash?
It also allows some breathing room in case you find additional forms, receipts, or paperwork that are missing. Have you ever taken your tax paperwork in, only to discover you were missing an investment form that you needed to track down? Or a home mortgage document that you can’t remember where you placed? Filing early prevents the mad scramble for loose ends at closing time.
And filing early means preventing fines and fees charged by inadvertently filing past the deadline. However, if you know you’re facing a delayed filing, request an extension in advance and you can likely avoid these fees.
If you do owe money, filing early allows more time to save the money needed than at the last minute.
In general, it is much easier to get an appointment with your tax preparation firm early in the year. Appointments and time available can fill up quickly in March!
For those with deadlines for student financial aid filing, having your taxes completed early will help! This holds true for anyone who needs tax information for purchasing a new home.
A quickly growing area of our business economy is the online “on demand!” sector. On demand entrepreneurs can offer anything from a car ride to a home for rent with the click of a button on a phone app in this shared economy. As tax time approaches, there are several important things for these up and coming tycoons to keep in mind when they file:
If you earn any income via shared economy, whether it be cash only, part time, or full time, it will most likely be taxable.
The plus side is that most of your business expenses can be tax deductible! Some of these expenses include cell phones, tolls, and gas used towards your venture.
Depreciation, or “wear and tear”, on your home and vehicles can be claimed for times when they are utilized for business needs.
Take the time to determine whether you are considered an employee, self employed, or an independent contractor. It will make a difference in your taxes!
Home rentals must be claimed on your income tax return. Fortunately that also allows for the possibility for more deductions in the forms of mortgage interest, maintenance, and utilities.
November marks the season of giving thanks for all our blessings, health, family, and friends. For many this season means looking for ways to give back to our community as we show our gratitude.
Filing your 2017 taxes online through File For A Cause is one easy way to contribute to a local organization. When you file your tax return under FFAC, a portion of the filing fee will be donated to Excentia. Where does your donation go? These monies help individuals find jobs, get job training, learn socialization skills, build social capital, and to live independently or with supports – however they feel most comfortable. Excentia provides developmental services from birth through adulthood…..helping people to life enriched and empowered lives. Their Employment First Program has placed participants in every kind of job from barista to law office reception assistant to arborist.
Did You Know Excentia…….?
serves about 1,000 adults and children each year
has 29 residential homes located in Lancaster County
volunteers at over 35 different non-profit organizations throughout the county
handles over 40% of the Lancaster City Meals on Wheels routes
Do you prefer to file your own taxes online? If so, please consider File For A Cause and when you do a portion of the filing fee will directly go to support a local organization – Excentia. File For A Cause utilizes a very easy to navigate, user friendly, and most importantly – secure, online filing system. To learn more, please check out our website and remember, ITP Taxes LLC is available to help answer any questions you have – even if you are filing online.
In 2018, File For A Cause will be supporting Excentia for a second straight year. Who benefits from a portion of your tax filing fee? Excentia is a local non-profit organization providing services to help empower individuals with developmental needs in our area. Services are available for everyone from childhood through adulthood, to be utilized as long as necessary. Therapy and education are provided to help each person live, thrive, and grow to their fullest potential. Excentia values human dignity and with File For a Cause donations, you can help support them in their mission!
“File For A Cause was a great way for my husband and me to feel good about filing our taxes. We know that if we run into a question we can ask Dave for clarification and that is very reassuring. Plus, we are part of a whole group of other philanthropic-minded people who are giving back to Excentia’s programs. I would recommend the program to anyone who is considering filing taxes online.” – Megan Lefever Titter
At this point, many of us know whether or not the most recent data breach has compromised our financial information. If you’ve waited to take the steps to check the security of your information, the Federal Trade Commission website can help. This site outlines how to determine if your information was exposed and how to further protect yourself from fraud. The PA Department of Revenue website also has helpful suggestions for recognizing signs that identity theft has occurred and how to report it.
What remains unknown however, is if this breach will have an impact on our 2017 taxes. This is where CNBC News “Your Next Worry After the Equifax Tax Breach” can help. One of the biggest concerns of this data breach, in relation to taxes, is whether someone else will file under your Social Security Number and receive a refund. The best way to prevent this from happening is to file first. Experts are recommending filing as early as possible this year to prevent a tax breach. Be aware and suspicious of unusual tax paperwork or mail you may receive this season that hasn’t been sent in the past. You can be organized and prepared by making a list of forms and paperwork normally received and checking them off as they are mailed to you.
The PA Department of Revenue recommends that you “know your tax preparer”! ITP Taxes LLC is a local business you can trust to help you file a return this season!
As a tax professional, I have the opportunity to meet many interesting business people who are participating in very creative enterprises! One such individual is Lisa Horst, Marketing Distributor for Send Out Cards. Never heard of Send Out Cards? Check out Lisa’s web page and take advantage of sending out your first card – for free! It’s incredibly easy to use and is a great tool for business owners who want to thank clients or for individuals to stay in touch and show friends they are thinking of them!
Send Out Cards (SOC) was started in 2003 in Salt Lake City, UT and Lisa has been a Marketing Distributor since 2009 in Lancaster, PA. SOC allows you to create and send tangible greeting cards, inspiration keys, and gift baskets through online ordering. The site allows you to customize your order and create unique gifts by uploading your own photos and text. Stock pictures and designs are available as well and you can mix and match to create the perfect gift or card for your individual needs. The most popular SOC gift is the delicious and decadent brownie 2 pack. Who wouldn’t love to receive brownies in the mail?!
You can even send a card or gift while waiting in line at the grocery store! Just download the mobile app (sendoutcards) from your app store or by following this link, enter Lisa’s sponsor #86486, and begin sending happiness! Send Out Cards are very affordable as well with standard 2-panel greeting cards ranging from just $1.17 to $1.98 plus a stamp. If you’d like to see it in use, a short video shows the ease of utilizing the app.
Customers, clients, friends, and family all love to hear from you and sometimes a text or email isn’t the most effective communication method. SOC combines photos and your heartfelt message all in one greeting card that will help them remember you, without breaking the bank. SOC is a GREAT follow-up business tool and personal stay in touch tool! Once you start spreading kindness around like confetti with SOC, you may become addicted!!