CARD act could make financial freedom harder for some

The 2009 financial reform CARD Act was meant to help protect customers. One provision of the bill is that those that provide credit can’t issue credit unless the applicant can prove that they can repay it. The bill is causing some severe unintentional consequences, however. Stay-at-home spouses are very possibly going to be losing financial freedom, under the provisions of this bill. Article source – CARD Act could strip stay-at-home partners of financial identity by MoneyBlogNewz.

What changes with the CARD Act in place

The CARD Act contains several provisions intended to safeguard consumers from unfair or inappropriate practices of charge card issuers. The Act also created several new rules that change how card corporations consider income. When applying for credit, “income” is very specific. It does not contain community property or household income. Instead, all income on an application for credit must be individual. Consumers won’t be able to over qualify for credit without money with this law.

The change from the CARD Act rules

Though it may not be intentional, the CARD Act could have a disproportionate impact on stay-at-home partners or parents. There might be one person who works while the other stays at home. In this case, the CARD Act makes it very hard for that stay at home person to get credit. Any stay-at-home spouses can be unable to get an independent credit history although it will stop those without income from getting a charge card. Without credit, there can be less opportunity for jobs. That will make it harder on an individual if the relationship ends suddenly.

The CARD Act and community property

In all the 50 United States, there is some “community property.” This is only in 10 of them though. A pre- or post-nuptial agreement would change things, but the property law means the couple shares anything. Every little thing in the marriage belongs equally to both partners. The CARD Act needs finances to be split in half for couples in community property states. For couples not in community property states, the CARD act simply means that one partner can’t obligate the other partner to bad credit loans or other debt without their explicit agreement.

How you’ll be impacted by the CARD Act

The CARD Act provisions will be really hard on any person who is a stay-at-home partner. If you stay at home and don’t have paying employment, you may be required to get your partner’s signature on every little thing from credit card applications to personal loans. Try and get a good credit history. This can help you a lot. Employment or some way of verifying monthly income from your partner is essential, as is maintaining open lines of communication about finances.

Citations

NCLC

nclc.org/

The Library of Congress

thomas.loc.gov/cgi-bin/bdquery/z?d111:HR00627:@@@D&summ2=m&

Can't pay your taxes? What to do about extensions and interest

The deadline for filing federal taxes is three days later than usual this year. Even with that additional time, some people will need an additional amount of time to get their taxes filed. Filing your taxes on time is very important. If you cannot file or pay your taxes on time, then you need to contact the Internal Revenue Service as easily as possible. As with all debts that you owe, ignoring the problem isn’t the best way to manage the situation. Instead, you need to contact the IRS as quickly as possible to address the problem. Source for this article – Can’t pay your taxes? What to do about extensions and interest by MoneyBlogNewz.

Extending your filing deadline

You will need to get an extension in filing if you will not be able to file your tax return by April 18. The proper filing of IRS Form 4868 should do the trick. This will make the deadline October 17 instead. Filing can be extended very easily. Nevertheless, the deadline for paying taxes won’t change. Whenever you file form 4868, you are required to estimate what your taxes can be. That has to be paid with the extension form. Failure to file an extension or a return will result in a 5 percent per month penalty, up to 25 percent of your total tax bill.

Payment deadlines also accessible

Tax filings and tax payments are different. That means the deadlines are different as well. You will have to file taxes nevertheless, even if you can’t pay the entire tax bill when it is filed. That way, you can keep away from paying both a failure to file and failure to pay penalty. You need to pay as much as you can as easily as possible. Make an effort to pay at least 90 percent of what is required when filing. This will cancel all penalties for six months, until the extended filing deadline. After you file, the IRS will send you a bill. It will only take 30 to 40 days to get it. It is important to pay fast since interest and penalties accumulate at 4 percent each day. Get a hold of the IRS if there is no way to pay. Call 1-800-829-1040 to talk about payments.

Exploring tax settlement choices

There are always ads for tax debt settlement. Television uses these often for commercials. Typically it is a poor choice to make an effort to use these tax settlement services. Getting same day loans to pay the debt would be a safer choice. Working class individuals can file an Offer in Compromise on their own with the Internal Revenue Service, which is all the tax settlement services do. An Offer in Compromise should be the last resort, after attempting to create a payment plan with the Internal Revenue Service. There are individuals standing by to talk to individuals at the Internal Revenue Service. Just call and figure things out.

Articles cited

IRS

irs.gov/businesses/small/article/0,,id=104593,00.html

H&R Block

hrblock.com/taxes/tax_tips/irs/extension_info.html

Child identity theft victims hurt most often by their family

sufferers of identity theft are increasingly those too young to realize it. New research shows that identity thieves are focusing increasingly on children because parents don’t pay attention and the theft can go undetected for years.

Why child identity theft takes place

There have been thousands already sufferers of identity theft while thousands more have the risk there nevertheless. A Carnegie Mellon University CyLab cybersecurity research center report explained this clearly. There were 42,232 children in the report looked at from the 2009-10 Debix AllClear ID Protection Network scan where parents were told about compromised child IDs. There were 4,311 kids, just a little over 10 percent, which had identity thieves steal Social Security numbers according to Debix AllClear ID data. Of 347,362 adults in the Debix AllClear ID data, there were 663 attacks. That is 51 times lower than the child rate at 0.2 percent for United States adults. The youngest it ever got was a five month old. The identity was stolen nevertheless. A 17-year old girl from Arizona found she was $725,000 in debt with 42 open accounts including mortgages, vehicle loans and charge cards. Her Social Security number was connected to eight suspects. A 14-year-old boy f! rom Kentucky had a credit rating going back 10 years listing a mortgage foreclosure.

Sufferers of friendly fraud

There has been lots of child identity theft. The early 1980s was when it began. The Social Security Administration got orders from the Internal Revenue Service. It said that children should be given Social Security numbers to go with them. Parents, family members and family friends started to do identity theft with these Social Security numbers. Javelin Strategy and Research reported that there were several “friendly fraud” cases last year. That was 30 percent of identity theft cases. Because credit checks do not verify age, identity thieves can freely take out loans, get credit cards and create accounts. The non-profit Identity Theft Resource Center recently helped a young man from Florida who failed a background check to become a police offer because his estranged father had stolen his identity years earlier and destroyed his credit.

Child identity theft solutions

According to the Identity Theft Resource Center, every child should be taught out identity theft. They should know sharing information on the Internet isn’t always safe. All personal information, including Social Security numbers and birth certificates, should be kept in a secure place. Be worried about a child having had credit opened if mail comes in the child’s name. A credit score could possibly be taken for the child from all three credit bureaus. Sometimes there is no credit report. That is most likely good for child. For those who have a credit history for the child, file a security alert. Do this at TransUnion, Experian and Equifax. File a police report using the credit reports as evidence. The credit bureaus are required to remove the credit report issues within 30 days after a police report listing the fraudulent accounts.

Articles cited

Forbes

blogs.forbes.com/moneybuilder/2011/03/31/protecting-your-child-from-identity-theft/

Atlanta Journal Constitution

ajc.com/news/child-identity-theft-increases-572552.html

Wallet Pop

walletpop.com/2011/04/05/report-as-child-id-theft-grows-rapidly-consider-these-precauti/

CEO pay soars as flat middle-class wages erode with rising cost of living

CEO pay in the United States was up 12 percent last year, averaging about $9.6 million. Fourth quarter profits for U.S. companies grew at a 30 percent rate, the most in several years of Sundays. While CEOs were giving themselves pay raises, wages for U.S. workers were stagnant as increasing gas and food prices eat into paychecks.

CEO increases at the expense of the workers

At a time when millions of Americans simply hope they keep their jobs, average CEO pay has risen to surpass pre-recession levels. The economy is beginning to rebound and executive pay is increasing, however employee pay is still constant with the recessions drop. As corporate profits soar, stock prices rise and productivity increases, CEOs can increase their own pay but don’t have to hire or award employees with rises because more than 13 million people are looking for work. CEO’s have no reason to hire employees when they are making do with who they have. Last year, an average of 12 percent raises was given to CEO’s by economic bail out sectors. Yet, private sector pay rose by about 2 percent. In March, unemployment was around 8.8 percent. It is forecasted to be years before the unemployment rate drops, according to most economists.

CEOs rake in huge stock opportunities

The highest paid CEO in the U.S. last year was Phillipe Dauman of Viacom who pocketed $84.5 million in just nine months. Ray Irani of Occidental Petroleum made $76.1 million past year, making him take the place of the second highest paid CEO. Forbes also states that Oracle’s Larry Ellison brought in $39.5 million making him the third highest paid. Fueled by Wall Street, CEOs are raking in the biggest paydays since 2007 with stock opportunities. Many CEOs accepted stock choices during the recession when they held little value, knowing that huge paydays lied ahead when the market recovered. Thanks to taxpayer bailouts and interest-free leverage offered by the Federal Reserve, the stock market has recovered spectacularly and the CEOs are cashing in. There was well over $20 million made by several CEOs cashing in their stock choices according to USA Today.

The rising commodity costs impact middle class

Middle-class America is having a difficult time with these payments to CEOs since they have had a hard time with pay increases. In the last five months, hourly income have not increased by as-much-as a single penny according to the Bureau of Labor Statistics. United States workers aren’t getting raises, yet the cost of products is ever increases. Since the start of the year, U.S. income and prices have been moving in opposite directions. Gas is the biggest thing hurting the American worker. An average of 12 gallons of gas a week is used by the average employee. Individuals have reported that filling a gas tank is costing $40 more per month than it did past year. In the mean time, the average weekly wage is up just $18 from past year.

Citations

New York Times

nytimes.com/2011/04/10/business/10comp.html?_r=2#38;ref=business

USA Today

usatoday.com/money/companies/management/2011-04-04-1Aoptions04_ST_N.htm

NPR

npr.org/2011/04/10/135272006/paychecks-cant-keep-up-with-rising-prices

Tax write offs you should not try at home

Some people are loading up to fire some strange tax deductions at the Internal Revenue Service this tax season. Whether it is sperm contributions or some other less than savory "business" expense, do not expect such things to go undetected. Don’t take these as examples, however marvel at the ingenuity – or laziness, or lunacy – that went into these crazy tries at tax deductions. Source of article – Bizarre tax deductions to brighten your tax day by MoneyBlogNewz.

Holy travel and entertainment write offs, Batman

Bankrate states that CPA Ken Sibley knew a male who tried to claim travel and entertainment expenses as tax deductions as a minister. Apparently, the minister was looking for real estate investment properties however never found his promised land after years of trying. It was not business expenditure.

Charity does not consist of getting married

Getting married is not enough to deduct expenses. It cannot be a part of business expenditures being deducted. Massachusetts CPA explained that it is not business expense, even if clients are attended. Wedding expenses are not considered a charitable donation either since it isn't a charity.

Expense taking 30 years

Don Meyer is a New Jersey CPA. He said that one manager of a famous entertainer got a $2 million office building purchased. It would be business expense and deducted as one. The manager wanted to use it that year for it. The recovery would take over 30 years to get. This was what Meyer told the male. Even a suitcase full of money and an ominous admonition to "make it work" couldn’t change the tax law.

Taxes for life

You cannot claim pets as security expense although you can deduct things are home for business expenditures. The IRS is also not okay covering home security systems. The Hunter Group of Fair Lawn, N.J., explained this detail of the IRS. One woman said that if somebody came into her home and killed her, she wouldn't be able to pay taxes anymore which mean she should be able to deduct her home security system.

Don’t make an effort to deduct adult magazines

Dues and subscriptions for professional and trade publications might be listed as tax deductions, so long as you are a professional in an approved field. According to Quizlaw, these would go under miscellaneous as long as the 2 percent floor rule is met. This means it must account for 2 percent or more of the adjusted gross income.

A Massachusetts CPA explained that a self-employed real estate agent trying to get adult magazines written off should probably reconsider the business strategy.

Once, Don Meyer had a prostitute client. That was different. Declaring her income was important to her. She said her job was in "public relations."

Articles cited

Bankrate

bankrate.com/finance/taxes/10-craziest-tax-deductions-for-2011-1.aspx

IRS

irs.gov/businesses/small/article/0,,id=204169,00.html

Quizlaw

quizlaw.com/federal_income_tax/can_i_deduct_dues_and_subscrip.php

On deducting haircuts and sperm donations

youtube.com/watch?v=uW6HWOekZ3M

Paying home loans getting simpler, however housing nevertheless depressed

Fewer individuals are having a difficult time paying the mortgage, though the housing market is still not doing too well. The housing market has continued to struggle, though employment is beginning to turn itself around.

Less homes underwater

A recent Harris Interactive poll, according to Daily Finance, revealed that, compared to last year, fewer survey subjects believed that their homes were underwater. There were 3,000 respondents, and 21 percent of them thought their homes were worth less than what was owed on it which was at 34 percent last year. Past year, there were 29 percent of Harris respondents that were not able to make mortgage payments, which dropped this year to 22 percent. There were 3 percent fewer with mortgages in the poll. There are fewer people applying for installment loans to cover a mortgage with a lower joblessness rate too.

Distressed homes flooding the market

USA Today reports that the number of distressed properties has been really worrying several. There were 1.8 million distressed homes without payment for at least 90 days as of January. The price of a distressed home always is at least 20 percent lower, which makes them attractive to bargain hunters and real estate investors. There are lots of them there though. That means all home costs end up being low. Soon the moratorium on foreclosures will end too, states Reuters. This will mean more foreclosures are to occur in the coming months. Several of the nation’s largest mortgage loan providers, including Bank of America and Wells Fargo, had to suspend foreclosures as questionable foreclosure practices at those institutions were being investigated by the government.

Cheap homes for those who can take advantage

More than likely, the market will continue as a buyer's market. More than likely, home prices will keep falling. MSNBC predicts this for the next few months. Mortgage rates are still coming off record lows several months ago, and people who can get the financing may never have to run out for same day loans to cover the mortgage payment if a low rate could be locked in. Lending might be hard to get. This is because loan providers are nervous about the market still.

Citations

Daily Finance

dailyfinance.com/story/real-estate/fewer-us-mortgages-in-trouble/19902674/

USA Today

usatoday.com/money/economy/housing/2011-03-30-distressed-homes-shadow-inventory.htm

Reuters

reuters.com/article/2011/03/31/us-financial-regulation-mortgages-idUSTRE72A63J20110331

MSNBC

msnbc.msn.com/id/38770102/ns/business-real_estate/

Ask for an Extended Payment Plan when you face payday loan default

If you’ve ever had trouble repaying your payday loans on time, here’s information you need. If you are dealing with a payday lender that is affiliated with the Community Financial Services Association of America, you can ask for an Extended Payment Plan (EPP). This amounts to a kind of emergency installment loan that stretches out the payments for four more paydays with no charge. Article source – Avoid payday loan default with an Extended Payment Plan by MoneyBlogNewz.

Lenders determine, after the state, EPP rules

Depending upon the state in which payday loans originate and whether the lender is a CFSA member, the stipulations of an Extended Payment Plan will vary. State laws are followed if the law already provides an EPP for customers on payday loans. CFSA members offer the service as an aid to customers in states where a specific law does not already exist. CFSA-member extended payment plans generally allow customers to repay their quick installment loans in four equal payments over the next four paydays, says eHow Money. Sometimes an EPP payment is missed. In this case, additional fees may apply.

How to request an EPP from CFSA-member lenders

• Lender should be CFSA. Try and get this. Any payday lender member will have the CFSA blue oval logo on its site or in its office. A lender doesn’t have to be a CFSA member to offer an Extended Payment Plan. This could nevertheless be accessible. Just ask about this. They’ll tell you what they can do.
• The lender needs to be contacted. Do this prior to the due date end of business day. If you are going to run into trouble repaying your payday loans, contact your lender before close of business on the day just before your loan is due. Go to the lending office or contact the lender online. The topic will be an Extended Payment Plan. Say this is what you need. You’ll then need to sign an agreement form that will specify the additional due dates. Read the extended payment plan carefully right before signing.

If the lender is a CFSA member and you haven’t used an EPP in the past 12 months, however the lender refuses to offer you an EPP to help you keep away from default, you can file a complaint. Contact the CFSA during Eastern time business hrs at 888-572-9329 (fax 703-684-1219) or cfsa@multistate.com. You can also send a letter to 515 King St., Suite 300, Alexandria, Va., 22314 to get a hold of the CFSA.

Articles cited

CFSA Consumer Complaint Form

cfsaa.com/cfsa-member-best-practices/how-to-file-a-customer-complaint.aspx

CFSA

cfsaa.com/cfsa-member-best-practices/what-is-an-extended-payment-plan.aspx

eHow

ehow.com/how_5906522_extended-can_t-pay-payday-loan.html

Get a money market account on the internet quickly

If you are dissatisfied with the rate of return on a traditional savings account, you’re in the right place. For a better rate of return, consider a money market account. They have slightly less liquidity than a savings account, however money markets are a safe investment that customers can easily sign up for on the internet. Post resource – Signing up for a money market account online is easy by MoneyBlogNewz.

Money market has accounts and funds

There are two basic variations when it comes to a money market: the money market account (aka the money market savings account) and the money market fund (aka the money market mutual fund). A bank usually is in charge of money market accounts while the FDIC insures it. These accounts are referred to as "electronic savings," "Internet savings" and "High-yield savings" by banks. There are requirements on a money market savings account that are not on a regular savings account. Nevertheless, they both offer liquidity.

Money market mutual funds are quality, short-term investments with some liquidity and interest rates that fluctuate daily. There have not been troubles with money market funds in the past when it comes to safety even though they’re not FDIC insured. Nevertheless, investors should know that if something takes place to the bank they’re invested in, they will not get their money back.

Which money market account will work best for you?

Your financial situation will determine what I best for you. You will have to shop around nevertheless. Between financial institutions, there will be great rates. Check Bankrate.com to compare rates. Watch out for banks that have a really high opening rate. Sometimes they plan to drop it down later.

Some banks give customers free checks and access to electronic funds transfer (EFT) from a money market fund and checking account. The number of monthly transfers might change though. There is typically a limit on this.

If you sign up for a money market account through a brokerage, unlimited check writing, an attached debit card and EFT transfers are common features. Future trades can be paid for by a separate money market account where extra cash is "swept" into. This account will get extra money from trades and investments.

Take a look at the website for your institution

It’s very clear what the procedure is to opening an account after you are at the website for the financial institution of your choice. When applying, you’ll have to get an account agreement form to print, sign and mail in. In case you are also getting checks, make sure you send in a signature card with it. You might nevertheless have questions about it. Call the toll free number most banks make accessible. It could be hard to do any transactions with a bank that makes it too difficult to sign up for a money market account.

Try an EFT

Make sure you sign up with an EFT connection if you are hoping to be able to instantly transfer money in or out of your money market account or money market mutual fund from your checking account.

Articles cited

eHow

ehow.com/how_6624319_open-money-market-account-online.html

Investopedia

investopedia.com/articles/mutualfund/07/money_market_savings.asp

Cathy Pareto, MBA, CFP, on the benefits of money market accounts

youtube.com/watch?v=BH_uiP5UlUE

Discharge of discount window details reveals big European bank bailout

The discount window provided by the Federal Reserve attracted a hoard of banks heretofore unknown as the financial system melted down. Thanks to a Freedom of Information Act request enforced by the Supreme Court the other day, data showing the true level of discount window lending has been released. The information provides a window on the severity and extent of the 2008 financial turmoil.

Bailing out banks throughout world

The discount window was created by the Fed a century ago to help healthy banks caught in a money crunch with short-term loans. When the Fed has to help out a financial institution, generally that bank's identity is kept secret. This is due to the stigma surrounded by a bank that needs some help. However the Fed was forced to make the details public by the Supreme Court after it ruled in favor of a Freedom of Information Act request filed by Bloomberg and Fox Business. Nobody was worried about the stigma anymore after the report was released Thursday by the Fed. This was because almost every financial institution in the world during the financial turmoil needed a bit of help. More than 25,000 pages of documents show the Fed lent as much as $110 billion through the discount window in one day as the financial crisis peaked.

European banks borrowing more than others

During the financial turmoil, Wall Street financial institutions got lots of criticism for taking government bailout funds. All of the data showed that European banks borrowed probably the most. The Fed report was clear about this. On Oct. 29, 2008, Belgian-French bank Dexia borrowed $26.5 billion and Dublin-based financial institution Depfa, owned by German mortgage lender Hypo Real Estate, borrowed $24.6 billion. There were other European banks to get billions from the discount window. These incorporated France's Societe Generale, Austria's Erste Group and Bank of Scotland. On this side of the pond, before it became the biggest bank failure in history, Washington Mutual borrowed $2 billion on Thursday, Sept. 18, 2008, to get through the weekend. Until Wamu was taken over by J.P. Morgan Chase on Thursday, September 25, 2008, it kept taking out the $2 billion loan overnight as it could not be paid back.

Details shows global degree of financial turmoil

When the collapse of Lehman Brothers in September 2008 triggered the financial turmoil, the global economy went into a tailspin, the financial system froze and banks worldwide begged the Fed for help. The release of the discount window data shows just how bad the damage was and the way quickly it spread. During testimony to a congressional panel investigating the financial turmoil in November 2009, Fed chairman Ben Bernanke said of all the financial institutions lined up at the discount window, only one was not at risk of total collapse. About two years after the loan has been released, the discount window lending information must be released in the future. This was part of the 2010 Dodd-Frank financial reform bill.

Information from

Fox Business

foxbusiness.com/industries/2011/03/31/demystifying-feds-secretive-discount-window/

Wall Street Journal

online.wsj.com/article/SB10001424052748703712504576234700412932330.html

Reuters

reuters.com/article/2011/03/31/usa-fed-lending-idUSN3126104220110331?pageNumber=2