This week I decided to do a roundup of timely and relevant articles about your money and taxes!
What are the chances of a tax audit?
Eighteen million calls to the Internal Revenue will go unanswered, and more than half of people’s letters will take over a month to respond to, according to IRS Commissioner John Koskinen via the Wall Street Journal last week. But even though the agency is both underfunded and understaffed, it’s still ready to audit. To make sure everything adds up, the Wall Street Journal offers some guidelines for avoiding and surviving the agency’s suspicious eye.
But many people don’t need to worry; taxpayers earning between $200,000 and $1 million are more at risk than those earning less than $200,000. Still, the IRS will run your numbers through a computer program that compares your return with a variety of averages, looking for outliers.
You could have a tax refund waiting for you
If you’re one of the 918,600 taxpayers who hasn’t filed their 2010 tax returns, then the IRS is about to bid adieu to your money. As CNN Money reports, if you don’t file your return by April 15, then your money, along with the other $760 million worth of unclaimed refunds, will become property of the U.S. government. If you thought you earned too little to file back in 2010, think again. Refundable tax credits, like the Earned Income Tax Credit, were designed to help low-income filers. The agency says that half of the refunds are worth more than $571. For more, head to CNN.
This actually has nothing to do with taxes, but I thought I’d give you a break. I am bummed that bacon prices are rising! TIME reports that prices for bacon, OJ and coffee, are on the rise. Why? A virus is killing off piggies! But before you get queasy thinking about it, know that the disease doesn’t affect people, and it’s not a food safety concern. However, as the supply becomes scarcer, it’ll affect the price of pork. For your morning OJ and coffee, check out the full article.
Spring cleaning your finances
U.S. News & World Report offers five ways to clean up your money act, starting with your budget. Now that we’re nearing the end of the first quarter, ask yourself: Have I been keeping in line with my savings goals? If the answer is no, don’t feel defeated — you have three more quarters in the game to get better. And here is my personal financial spring cleaning checklist, in case you haven’t seen it.
Although the article didn’t give you the link, here is the link to your free annual credit report as required by law. I always think tax time is a
good time to check again, but keep in mind, this isn’t giving you your credit score, simply providing away for you to check the accuracy of the information listed.
After reviewing the budget, look to organizing, and possibly shredding, your old financial documents. The shredding is more for your financial security than it is for cathartic purposes, which is why you should consult the IRS’ website to see their guidelines for how long you should keep certain documents. Here is a post I did on a good year-end process to make sure you’re not throwing out anything you need.
Actions This Week
go easy on yourself during tax time (that’s plenty to keep most people busy), but as you wrap up your taxes—or prepare to file an extension—make a list of the things you’d like to accomplish money-wise once taxes are out of the way. And it doesn’t have to be super-long, just decide what you want to make happen in the next 30 days!
I don’t prepare taxes, but I tend to help people get organized before tax time comes, so if you want a better handle on managing your taxes going forward, let me know!
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