Once you're all done with your taxes, it's the season for spring cleaning. Organizing ... decluttering your house ... throwing out old furniture, money can work the same way, too.
Personal finance expert Farnoosh Torabi gives us her recipe for a productive financial spring cleaning.
Automate your bills: “Automate your bills because that means less stress. It’s minimizing your financial burdens ... Also, to make sure you’re always paying your bills, never getting behind.”
Go paperless: “This is something as a country we’re doing more and more of, but some of us are a little bit behind ... That will help to declutter and give some piece of mind.”
Hold onto three (or six) years worth of tax documents: “If the IRS does come a knocking with an audit, they will want to see the last three years of your records, and all your supporting documents. The one exception, you have to answer this honestly, if you’ve been underreporting income and the IRS audits you for that reason, they can go back as far as six years. So if you’re somebody that takes a little bit of risk with your reporting, and pushes the envelope, make sure you have even more support and backup.”
Look ahead: "Spring is a time when we’re looking ahead. A lot of families perhaps are thinking about a home, people are buying cars, applying for loans for school, so this is a good time to get a firm understanding of where you stand credit wise. Go check your report at annualcreditreport.com (and that’s free!)."Marketplace Money for Friday, April 11, 2014Interview by Lizzie O'LearyPodcast Title Tidying up with financial spring cleaningSyndication SlackerSoundcloudStitcherBusiness InsiderSwellPMPApp Respond No
Craig Baldwin holds a sign advertising a tax preparation office for people that still need help completing their taxes before the Internal Revenue Service deadline.
April 15 marks the last day to file your taxes ... unless you hit the panic button and file an extension.
You can file an extension, but…
You still have to pay your estimated taxes. According to Kelly Phillips Erb, a tax attorney in Pennsylvania, “the IRS wants you to pay what you paid last year, that’s a good rule of thumb. If nothing has changed remarkably, if you paid as much as you owed last year, you should be fine. The penalties and interest come when at the end of the extension, you still owe a bucket of money. you want to try and approximate what you owe as much as possible.”
If you can’t pay your taxes in full:
- Pay in installments
At IRS.gov, taxpayers can enter into an installment agreement with the IRS. “There are some restrictions and some limitations,” says Erb. “The one to keep in mind the most is that you have to owe less than $50,000 to qualify for the installment agreement. And it’s for individual taxpayers. Business taxpayers generally still have to go through the normal channels.”
- Pay a little bit now and a little bit later.
“Taxpayers shouldn’t be frightened of making partial payments,” Erb says. Even if you have to pay a penalty and interest payments, that’s an improvement over leaving the full tax bill untouched.
Use a tax preparer ...
Though filing your taxes can be a labor of love for many people, Erb says there are times it’s worth using a professional. “If things have changed in your life, I highly recommend using someone … you know whether you’ve had a baby or whether you’ve gotten married and life events, you usually want somebody that can kind of help you get guided through the process because it’s my experience that the folks who are worried about getting their taxes done, it’s generally not that they are worried about making a mistake, it’s that they often are just kind of overwhelmed and I think those people tend to under-deduct.”
... But beware of preparer scams
“When you hire a tax preparer you want to make sure that they are credentialed, and that they know what they are doing. The IRS still require tax preparers prepare returns for compensation, those folks still need to have a PTIN number, you can think of it like a Social Security Number for preparers, so the IRS knows who’s preparing that return.”
... And IRS scams too
Scammers frequently pose as IRS representatives through email and phone calls, and threaten fines and arrest if you don’t immediately send money. “If you owe taxes, if anything has gone wrong with your filing, most of the time they’re going to contact you through a letter. They’re not going to text you. They’re not going to call you. And they’re not going to email you. And a lot of these identity thefts schemes that are going on right now are from folks posing as representatives from the IRS. Kind of the most prevalent one right now is when IRS allegedly, someone from the IRS, calls up folks, they’re kind of targeting immigrants and the elderly in particular, and say, ‘you owe money to us. We’re going to arrest you tomorrow if you don’t pay us now.’ And then they’re asking for debit card information over the phone.
Marketplace Money for Friday, April 11, 2014by Raghu ManavalanPodcast Title Last-minute tips for tax procrastinatorsStory Type InterviewSyndication SlackerSoundcloudStitcherBusiness InsiderSwellPMPApp Respond No
If you’ve noticed your receipt from the grocery store seems larger than usual, you have food inflation to thank.
While the prices of everything usually go up due to regular boring inflation, commodities like food have outpaced other goods.
Matthew Boesler, Business Insider reporter, says food inflation is increasing because of a few different factors.
“A lot of it is due to weather. We have a big drought in California. We’ve had dry conditions across the Midwest, the Great Plains regions,” Boesler says. “The extreme weather events serve to disrupt crop supplies. and that can drive prices up.”
“Another factor you have is the ‘financial-ization’ of these commodities markets,” he says. Hedge funds and other investors are increasingly pouring money into goods like beef and coffee. “It’s very easy for an investor to bet on rising commodity prices. And no one really bets on those prices going down, so you have a lot of one-way money flowing into these markets, and they can become quickly overwhelmed because [investment markets are] not designed for that.”
Data: Bureau of Labor StatisticsRaghu Manavalan/Marketplace
“Supply and demand sort of governs the price of a commodity, but the way these markets are set up and you know, given how much capital is flowing seeking investment opportunities, the jumps in prices can be very volatile and large.”
Recent updates to the Army's regulations on grooming and appearance forbids natural hairstyles that are popular with many black women. The women of the CBC have asked the Army to reconsider.
A grilled cheese on rye.
Here's an extended look at what's coming up next week:
On Sunday, the final season of "Mad Men" premieres. I had to put on my go-go boots and pour myself a martini for that tidbit.
On Monday, while we all drink heavily at a business meeting we've dressed up and styled our hair for, the Commerce Department is scheduled to report retail sales data for March.
On April 14th, 1939 John Steinbeck's "The Grapes of Wrath" was first published. The depression era novel went on to win the Pulitzer Prize. Speaking of the Pulitzers, Prizewinners are scheduled to be announced on Monday.
Did consumers pay more or less for stuff in March than they did in February? On Tuesday, the Labor Department issues its Consumer Price Index. And it's tax day. An American tradition.
That brings us up to hump day. We'll get numbers on construction of new homes for March. And the Federal Reserve releases its latest Beige Book summary of commentary on current economic conditions.
Wondering why I'm not talking about any hearings on Capitol Hill? It's because Congress is on recess.
Markets are closed for Good Friday.
Television host and comedian Conan O'Brien turns 51.
And since we here at Datebook love cheese, let's end with this deliciousness: April is National Grilled Cheese Month. Start melting.Marketplace for Friday April 11, 2014by Podcast Title Datebook: Say cheese... all April longStory Type BlogSyndication SlackerSoundcloudStitcherSwellPMPApp Respond No