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Tax Relief on Loan Interest


by Anna Chumakova on April 02, 2019  0 Comment

Tax Relief on Loan Interest
Anyone paying off their loan can appreciate an opportunity to make the repayment process easier, regardless of the amount of debt they carry. Especially those of us who struggle to get their ends to meet at the end of the month should take advantage of any chance to write off a portion of their payments. Fortunately, the IRS offers individual and business taxpayers quite a few tax relief options on loan interest. For certain types of loans, the IRS allows you to deduct the interest on your yearly tax return. Let's explore different types of interest and see when each qualifies for a tax deduction. Business Loan Interest Generally, the interest on business loans, including mortgages on business property and ...

Promissory Note Tax Implications


by Anna Chumakova on April 02, 2019  0 Comment

Promissory Note Tax Implications
A promissory note is a legal document in which one party promises in writing to pay a certain amount of money to another party by a certain date. Promissory notes are often used for providing investment loans or loans to friends or family who can't obtain finances through traditional institutions. A promissory note obligates the borrower to repay the debt. As such, a default on your promissory note could result in serious tax issues. Whether you are a lender or a borrower on a promissory note, it would serve you well to know how this IOU (I owe you) document works and how it affects your income taxes. Components of a Promissory Note For tax purposes, you need to consider a ...

Should You Apply for a Direct Consolidation Loan?


by Anna Chumakova on March 26, 2019  0 Comment

Should You Apply for a Direct Consolidation Loan?
With a Direct Consolidation Loan, you may simplify your loan repayment process by combining several federal student loans into one.   This type of loan won't lower your interest rate, but it might result in a lower monthly payment.  Application for a Direct Consolidation Loan might also help you qualify for other repayment programs; however, you might lose certain borrower benefits. Managing your student loans might be challenging for various reasons. While some individuals have a hard time keeping track of different due dates for different loans and thus miss payments, others experience financial hardship due to job loss or some other unexpected event. If you find yourself in a similar situation, you might consider loan consolidation to make it ...

Can You Get Personal Loans With Bad Credit?


by Anna Chumakova on March 26, 2019  0 Comment

Can You Get Personal Loans With Bad Credit?
Poor credit can be an obstacle to securing a personal loan. Although many lenders offer personal loans for individuals with bad credit, they often charge higher rates. To obtain better loan terms, consider taking some steps to improve your credit before applying. Personal loans can be used to cover emergency expenses, make big purchases more manageable, or help ends meet when you are stretched thin financially. They can even be used to pay off credit card debts. However, this type of loan is typically unsecured, which makes it harder to obtain, especially when your credit is not perfect. Creditors that offer personal loans for individuals with poor credit usually charge much higher interest rates to compensate for greater credit risk. Although ...

Should You Take Out a Hardship Loan From Your 401(k)?


by Anna Chumakova on March 26, 2019  0 Comment

Should You Take Out a Hardship Loan From Your 401(k)?
Retirement plan loans offer an alternative and easier way of obtaining a hardship loan.  However, this type of loan may also have a negative effect on your financial health in the future.  Before applying for a hardship loan from your retirement plan, thoroughly evaluate its benefits and downsides. When you are experiencing financial hardship, you might be inclined to borrow the needed amount of money out of your 401(k) plan instead of applying for a loan with a traditional lender. Compared with the plan's distribution benefits, which discourage early withdrawal with high penalties and tax charges, a hardship loan might seem like an appealing and easy option. Although retirement plan loans could make sound financial sense in certain situations, they also come ...

Tax Debt From a Spouse


by Anna Chumakova on January 10, 2019  0 Comment

Tax Debt From a Spouse
Typically treated as a single unit, married couples can still separate their assets and liabilities for tax filing purposes. Your liability for your spouse's debt will be determined by your relationship status and how you filed your taxes.  Several filing strategies can help you protect your assets from being garnished because of your spouse's debt. In terms of the law, married couples are deemed as a single unit with shared income, assets, and liabilities. However, in the tax filing process, the distinction might be made between the two individuals, particularly when one spouse owes back taxes. Whether you are liable for your spouse's taxes will depend on the status of your relationship when the debt was incurred and how you ...

IRS Personal Taxes


by Anna Chumakova on December 05, 2018  0 Comment

IRS Personal Taxes
Owing taxes to the IRS is a serious matter that must be resolved as soon as possible to avoid unpleasant consequences and unnecessary stress. Once you've realized that you owe a hefty tax bill, you must be proactive about the situation, especially if you find yourself unable to pay in full right away. Whether you are short on money due to an emergency or some significant life event, you need to know what to do next and what mistakes to avoid. Costly Mistakes — What Not to Do Before we go into details about what to do if you owe taxes, let's look at some common mistakes taxpayers make. Not Filing Your Return Many taxpayers tend not to file a ...

How to Get Extension on Taxes


by Anna Chumakova on December 02, 2018  0 Comment

How to Get Extension on Taxes
If you can't file your taxes on April 15, apply for a tax extension right away to get another six months to file your taxes. With a tax extension, you will avoid penalties for not filing your taxes, which exceed penalties for not paying by tenfold.  Unlike payment agreements, a tax extension only grants you additional time to file, not to pay. Sometimes life happens to all of us and things could get in the way of our most sincere intentions. You might find yourself unable to submit your tax return on time because you are simply behind on your to-do list. Or, you might already be in debt and delay filing your return because you can't pay your next ...

Taxes for Rideshare/Uber Drivers


by Anna Chumakova on November 28, 2018  0 Comment

Taxes for Rideshare/Uber Drivers
If you recently began driving for Uber, whether full-time or just to make some cash for holidays, you need to know about the tax implications of providing ridesharing services. When you are self-employed, as is the case with Uber drivers, your income tax filing requirements are completely different than those for employees. To prevent any unpleasant surprises, such as tax debt, let's review what changes are in store once you start working for yourself, and discuss your new tax filing process. Uber Drivers Tax Classification Uber drivers are classified as independent contractors providing driver services. At the end of the year, they usually receive Form 1099 instead of a W-2 used for employees. Since Uber drivers are non-employees, Uber doesn't ...

What to Know About IRS Installment Payments


by Anna Chumakova on October 30, 2018  0 Comment

What to Know About IRS Installment Payments
The IRS offers a variety of installment-plan options to help taxpayers pay their tax debt. Although it might be easier to pay the amount you owe in smaller increments, all installment agreements generate penalties and interest.  Both short-term and long-term plans are available, depending on how much you owe, and special setup-fee options are available for low-income taxpayers. Thing's aren't looking good. You've hit rock bottom. Tax debts are at your doorstep and you have no way to make the payments — or do you? If that description sounds applicable to you, then keep reading to learn what you can and should do to improve your debt situation. No solution is going to be completely flawless, but installment payments could ...

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