Thrifty Gift Giving… part 3

Thrifty Gift Giving, part 3 of 4

Bargain Shopping

Bargain shopping is probably one of the most common methods of thrifty gift giving.  We see this every Black Friday and Cyber Monday.  Instead of struggling to beat the crowds on those days, why not bargain shop for gifts all year round?  Here are some of my favorite bargain shopping approaches:

1. Sales and clearance – The days between Thanksgiving and Christmas have nice sales, but the after season sales can be even better.  Watch your weekly ads for some amazing deals throughout the year.  Also, due to the economy, some stores have been forced to liquidate.  Keep an eye and an ear out for these situations and take full advantage of them.
2. Coupons – I literally save hundreds of dollars every year by using coupons.  Don’t just clip them from the local ads and papers.  Sign up with stores and manufacturers to receive their coupons via mail or email.
3. Thrift stores and yard sales – Sometimes you can find brand new items with the tags still attached.  Or you can find gently used items that can look like new with a little elbow grease.
4. Discount stores – You can find a lot of nice things in discount stores for very little money.
5. Online shopping – There are many online stores that offer great deals or hard to find times.  If you are going to go this route, make sure that you are truly getting a deal.  If the shipping and handling causes the purchase to be more than it’s worth, don’t go through with it.  Look for places that will ship for free or for next to nothing.

Have fun shopping and finding the deals and be sure to check-out tomorrow’s blog when I will offer some gift basket ideas.

Thrifty Gift Giving… part 2

Thrifty Gift Giving, part 2 of 4

Free – No Money Spent

Obtaining gifts for free is an obvious way to save money on presents.  However, it isn’t always easy to do.  Here are some methods that I have used in the past that may help you.

1. Re-gift – I’m sure most of you have heard of this.  If a gift you receive isn’t exactly for you, but it would be good for someone else, save it and give it to that person next season.
2. Winnings through contests and drawings – The chances of this happening are usually slim, but it’s worth a try so long as it doesn’t cost you anything.
3. Redeem credit card points – Most credit cards allow you to earn points which you can then redeem for products or gift certificates.  Many times you have to take the initiative to contact your credit card company and sign up to receive these benefits.  Do not use these points as an excuse to use your credit card, unless you are going to pay it off in full.  Often the benefits of these redemptions do not cover the costs of the interest incurred.
4. Freecycle – This is a great group that many people do not know about.  It is a forum where people give away things that they no longer want or need.  Sometimes you can find new or gently used items that would make great gifts.  To find your local Freecycle community, search for”Freecycle” using your favorite search engine.

Save money in these difficult times by utilizing some of the suggestions I share here.  Be sure to checkout tomorrow’s blog when I talk about bargain shopping.

Thrifty Gift Giving.. Part 1

Thrifty Gift Giving, part 1 of 4

Make Gifts

In today’s economy with rising prices and jobs losses all too common, thrifty gift giving has become a hot topic.  Over the next 4 days I will be sharing tips to ease the burden on your wallet while providing thoughtful gifts to friends and loved ones on your holiday gift giving list.

Something that I love to do every year is make gifts.  I realize that it may be intimidating for some, but with the proper planning and drive, you can make great presents.  Talented or not, you’re putting time and thoughtfulness into a gift, doubling its value to the recipient.  Here are a few ideas for you to run with:

1. Ornaments – You can purchase unfinished ornaments at your local craft store and personalize them with paint, decorations, pictures, etc.
2. Drawings and paintings – Pick something that is meaningful to the recipient and let it be your muse.
3. Baked goods and candy – This is something that can really stretch your dollar.
4. Poems or books – Write a poem or a mini book about the recipient or create a recipe book that includes some favorite recipes.
5. Coupon books – Who wouldn’t love to have you come over and mow their lawn? Create a booklet with coupons for your services such as cleaning, babysitting, etc.
6. Photos – Use photos that are meaningful to the recipient to create a framed collage or a scrapbook. You could also make calendars (write in all the family birthdays and anniversaries for them), coffee mugs, mouse pads, t-shirts and much more using the pictures.

Be sure to check-in tomorrow when I share ideas on obtaining free gifts in your frugal gifting.

IRS Mileage Rates for 2009/2008

IRS Mileage Rates for 2009

IRS Mileage Rates for 2009 where announced November 24, 2008.  The standard optional mileage rates for employees, self-employed individuals, or other taxpayers to use in computing the deductible costs of operating an automobile for business, charity, medical or moving expenses for 2009 are:

Business                            55 cents per mile

Charitable contribution     14 cents per mile

Medical and moving          24 cents per mile

IRS Mileage Rates for 2008

IRS Mileage Rates for 2008 consist of two different rates dependent upon date, and are:

Rates 1/1 – 6/30/08     Rates 7/1 – 12/31/08

Business                           50.5                 58.5 cents per mile

Charitable contribution     14                    14 cents per mile

Medical and moving          19                    27 cents per mile

I find it a valuable tool to keep a calendar in my vehicle to log my tax deductible mileage.  (Also, good for filling out reimbursement reports for employers).  January 1st of 2009 is time to log in the odometer reading for your new year’s calendar.  I have found the IRS easy to work with when proper documentation for deductions are available.

We look forward to sharing a lot more information through this blog so please check in now and then and share it with your friends.  For help with your taxing questions and problems, visit our web site or call Better Financial Solutions, LLC at 330-494-5335.

Working at Better Financial Solutions, LLC

Working at Better Financial Solutions, LLC

An accounting firm has always been one of my ideal places in which to work and now I am working at Better Financial Solutions, a CPA firm.  I am very excited that I actually get to experience working in my ideal job as a high school student.  I have been working in Better Financial Solution for a little more than four months now.  Although my work hours are less since school started at the end of August, I have always looked forward to coming to work and like the variations.  Working at Better Financial Solutions, I have learned so many things.

Some people might think working in an office is boring, but I find it enjoyable.  Marie Cutlip, a CPA of this firm, has taught me a lot about accounting and business.  Working with a variety of industries and accounts, preparing tax return support, and doing office work are actually quite fun.

It is fascinating to work on accounts and to see the flow of money going in and out on a daily basis.  Every single transaction that the businesses make are recorded.  As I am taking an accounting class in school, it helps me greatly to do well at work and to understand better about what I am doing.  Also when I am in my accounting class, I find it interesting to learn more about the things that I have already learned at work.  I feel that I already have a great start with pursuing my career in this field.

Self-employed Taxes and Strategies

Being self-employed can bring great rewards and freedoms but also great responsibility.  Self-employed taxes and strategies offers guidance to avoid tax traps.

Are You Self-employed?

You are considered self-employed and subject to self-employment tax laws if you:

• Carry on your own trade or business
• Have a profit motivation for your business activity
• Operate your business in a regular manner
• Are a sole proprietor
• Are an independent contractor
• Work full or part-time in a business endeavor
• Have a net profit (profit after expenses) of at least $400 [or of $100 or more as an employee of a church electing exemption from Social Security Withholdings).

Self-employment tax

All self-employed persons must pay a self-employment tax in addition to income tax. The tax is 15.3% of net earning and has two components; a 12.4% old age, survivors and disability insurance (OASDI) tax and a 2.9% component for hospital insurance (Medicare).  The 12.4% OASDI portion is paid on net income (revenues less expenses) up to a set amount similar to social security. The 2.9% Medicare tax is paid on all net income. If you receive any wage income on which Social Security or Railroad taxes were paid then the self-employment tax income maximum is reduced by the amount of wages received. If self-employment income is below $400, no self-employment tax is due.

Self-Employment Tax Traps

To reduce your chances of an unexpected tax bill, consider the following:

• Always keep self-employment activity and records separate from other expenses. Keep a separate checking and savings account for your self-employment activities. The IRS is very quick to deem expenses as personal and therefore non-deductible expenses if your bank account co-mingles personal and business expenses.
• Do not confuse hobby and rental income activity as self-employment activity. The tax code applies separate laws to these two activities. If in doubt…ask.
• Remember the IRS treats all profits as if they are wages subject to self-employment taxes. This is true whether you wish to distribute or retain your profits. Consider using alternative corporate structures if you want to avoid some of this tax.

Deductions

One of the biggest tax advantages for self-employed is the ability to deduct your business expenses directly against your income regardless of whether you itemize your deductions or not.  You are not subject to the 2% of adjusted gross income threshold that applies to an employee’s out-of-pocket business related expenses. As a self-employed individual, your business expenses reduce the amount of your income that is subject to the self-employment tax (FICA) while the unreimbursed business expenses of an employee do nothing to reduce their FICA tax.

Self-employed Health Insurance

Another major tax deduction provided by the IRS to the self-employed is the ability to deduct a large portion of your medical insurance costs. Under certain circumstances, if you hire your spouse as a bonafide employee and provide health insurance, 100% of the cost may be deductible.  Be careful, if the spouse is eligible to participate in another employer plan this will not work.  Similarly, a written self-insured medical reimbursement plan may be a 100% deductible expense plan and enable you to provide tax free reimbursement of uninsured medical costs to employees for things like co-payments, prescriptions, vision and dental care.

We look forward to sharing a lot more information through this blog so please check in now and then and share it with your friends.  For help with your taxing questions and problems, visit our web site or call Better Financial Solutions, LLC at 330-494-5335.

Small Actions Quotation

Great things are achieved through the steady accumulation of many inconspicuous small actions.” -  Ikeda