Free Tax Help!

If you or someone you know earned less than $49,000 in 2009, you may be eligible for up to $5,600 in Earned Income Tax Credit (EITC). – and your taxes can be done for free beginning in January.

Many families have their taxes done using their year-end paycheck and sometimes pay more than they should, especially if they want a quick refund. By taking advantage of the free tax preparation, these working families and individuals can keep more of what they earn.

Eligibility requirements for the 2009 EITC are:

~ Families with three or more qualifying children who earn less than $43,279 (or less than $48,279 married filing jointly) are eligible for a credit of up to $5,657.

~ Families with two qualifying children who earn less than $40,295 (or less than $45,295 married filing jointly) are eligible for a credit of up to $5,028.

~ Families with one qualifying child who earn less than $35,463 (or less than $40,463 married filing jointly) are eligible for a credit of up to $3,043.

~ Workers without a qualifying child who earn less than $13,440 (or less than $18,440 married filing jointly) are eligible for a credit of up to $457.

The Child Tax Credit, which is up to $1,000 per qualifying child, is another often overlooked benefit. For tax year 2009, the minimum income threshold needed to qualify for the Additional Child Tax Credit has been reduced from $12,050 to $3,000, so more families will be eligible.

For information on tax site locations and what to bring, check out the following links.

• Tax Site locations
• Items to Bring

Are You Ready to Own Your Own Home?

By Karen Saley, Extension Specialist

It’s very enticing with the $8,000 tax credit available, the many home-buying incentive programs offered, and the number of discounted properties on hand, to jump into purchasing a home right now. But you may want to slow down, take a breath and look at the realities of home ownership.

Many people have a good idea of what the mortgage's principal and interest will cost every month, but principal and interest are only part of the equation. Property taxes, homeowner insurance mortgage insurance, and homeowners or condo association fees can typically add hundreds of dollars to each monthly payment.

Before you sign on the dotted line it's a good idea to get a rate quote from a couple of insurance companies, check with the county appraisers office to find out what the taxes are on the property , and ask the current owner about any association fees. Remember to include these figures along with any mortgage insurance in your calculations when determining how much monthly payment you can afford.

The Federal Housing Administration recommends that you spend no more than 31 percent of your before-tax income on a monthly house payment, including principal, interest, property taxes, homeowners insurance, mortgage insurance and homeowners or condo association dues. Once your monthly payment begins exceeding that 31 percent you may be in jeopardy of not having enough monthly income to cover the rest of your obligations and save for your future.

So before joining in the American dream of owning a home, do a little homework to ensure that your dream doesn’t turn into a nightmare.

Are You a Saver?

By Karen Saley, Extension Specialist

You’ve probably heard it a million times…pay yourself first. Well I’m going to say it once more. You may think you don’t have any money to save, but I’m here to tell you that if it’s important, and it is, you will find even the smallest amount to set aside. You may be saying “if it’s such a small amount it won’t make a difference in my life so why bother.” It will make a difference because even if you aren’t able to save a substantial amount of money right now just the act of regularly saving will get you into the habit and when the time comes when you are able to save more it will make a great difference. Here are a few suggestions to get you started on your savings plan.

~Start by saving your change then add a dollar a day to that change
~Save every five dollar bill you come across.
~Track your expenses for a month to identify spending leaks.
~Make small sacrifices like that daily cup of coffee and save the money.
~Brown bag lunches can save a bundle.
~Seek out free entertainment
~Get your movies for free from the library
~Live below your means…don’t spend more money than you make!

Think of savings as a monthly expense just like any other bill you have and get in the habit of paying yourself first. Before you know it you will have a nice little nest egg.

For more savings tips along with other financial advice click on the link below
www.smartaboutmoney.org