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Mar 21 12

A gentle reminder that life is often unpredictable

by Bill Varettoni

Just a gentle reminder that life is often unpredictable.

I talked to the owner of this cafe in Rockville this morning, and sure enough the bakery was there first.

Consider this too a gentle reminder to our members to complete your emergency account calculator!

Mar 6 12

Community Ladders adds extended evening Skype appointments for West Coast and international members

by Bill Varettoni

More and more of our members are joining from outside the D.C. region.  Whether that is the West Coast of the U.S., or our American expatriate members in Ukraine, China and India, we realize that our EST hours might not fit all schedules.  As such, Community Ladders is now offering late evening Skype sessions on select weekdays.

We are excited to have new members join us from across the U.S.A. and around the world!

Feb 28 12

This Sunday (3/4) C-L gives a free seminar for young professionals at All Souls Church in Columbia Heights

by Bill Varettoni

Last August, Community Ladders presented a free financial planning seminar for young professionals at All Souls Unitarian Church in Columbia Heights, D.C. The seminar was very well received, and so we’re doing it again this Sunday, March 4, from 12:15 to 1:30 in the Longfellow Room.

We will cover a lot of ground, and so we will start promptly at 12:15 (right after the second service) and end at 1:30 when the church closes.
 
Among the issues that will be covered:

–         Common problems and anxieties facing young professionals

–         Elements of holistic planning particularly important for those with low- and middle-incomes

–         Student loan debt and options for repayment

–         Using credit effectively and building your credit score

         Tax deductions that always matter

         Budgeting suggestions

–         Retirement investing 

Would you like Community Ladders to speak to your church, non-profit, or office about common sense financial planning? See our webpage for more information!
Feb 27 12

This Thursday (3/1) C-L competes in ‘The Next Big Thing’ social enterprise pitch competition

by Bill Varettoni

Community Ladders is one of 5 companies chosen to compete this Thursday (3/1) at the “Be: The Next Big Thing” social enterprise pitch competition hosted at the University of Maryland. The competition is part of an all-day Social Enterprise Symposium.

If you’d like to check out the competition (and perhaps support C-L), it will be held from 6:00 – 7:00 PM in the Stamp Student Union’s Atrium (room 1107).  We will be the first company presenting our 6-minute pitch plus Q&A, so we expect to go on promptly at 6:00 PM.

Getting to UMD: There is a UMD shuttle bus that goes from the metro station to just outside the Stamp Student Union (it’s the final stop), and you do NOT need a UMD ID to ride the bus. If you are driving, you can park in Lot 1 after 4PM for free without a permit.

Hope to see you there! 

Feb 18 12

Community Ladders Can Prepare Your Return

by Bill Varettoni

Community Ladders offers a tax preparation service for a flat $65 for members and teachers (we got our start working with teachers, so they hold a special place in our heart).  For everyone else, it’s $75. The service includes federal and state paper-based returns, the program file (which you can use to pre-fill your taxes the following year), and a soft copy archive PDF. We don’t currently prepare small business or investment partnership taxes, nor do we deal with offshore tax shelters and the like.

Here is our guide (in PDF) on what to bring to your tax session: What to Bring to your Tax Preparation Session.

Taxes are prepared by Bill Varettoni, who is a registered tax preparer with the IRS, a graduate of the Jackson Hewitt Full Tax Preparation Course, and has a degree in accounting. Contact us to schedule an appointment or request more information.

Feb 18 12

Tax Tips and Deduction Guidance

by Bill Varettoni

Somethings (almost) Always Matter

It is a point of professional pride that I found errors in two of our members’ prior-year tax filings. Coincidentally, both were prepared personally by H&R Block tax associates, and both failed to deduct legitimate moving expenses. For one member, the difference was so significant that we filed an amended return to get money back (the other’s would have been a ~$35 refund, and she decided not to bother). The failure of these paid preparers is especially galling because moving expenses, when certain criteria are met, always count- even if you are taking the standard federal deduction. And it’s not just a few things that count towards moving expenses – it’s almost anything related to the move, so it adds up quickly.

Here are things that almost always count, regardless of whether one itemizes or takes the standard deduction:

– Moving expenses

– Student loan interest (phases out at higher incomes)

– Traditional IRA contributions (phases out at higher incomes)

– Educator expenses (the first $250 of eligible purchases)

As the anecdote I started this entry with compels, if you are having someone prepare your taxes don’t be shy about asking about these categories!

Other Deduction Guidance

Given the range of possible deductions, it’s not surprising that people commonly miss some. Here is one of our favorite collections of oft-missed deductions.

When to File

Congress and the IRS are often quite busy changing and tweaking things late in the calendar year.  As such, the tax software companies have little time to debug the final version of their software. For this reason (and a few others), I don’t even start preparing people’s taxes until February each year, after the IRS has issued its clarifications and the software makers have used early filers to find the bugs in their software.  Furthermore, while most W2 and 1099 forms should arrive by the end of January, some companies are invariably late; if you file too early and forget about income, you will need to file an amended return. I’ve also seen brokerages occasionally send revised 1099 forms in mid-February.  So, unless you’re desperate for a refund (or are filling out a FAFSA), it may be less hassle to wait until the end of February to start your taxes.

Feb 18 12

Free tax software for 70% of taxpayers; free personal preparation for those earning less than $50K

by Bill Varettoni

 

Free Federal Tax Software

70% of taxpayers have an adjusted gross income (AGI) of less than $57,000 and are therefore eligible for free federal tax preparation software. Your AGI can be found at the bottom of the first page of your Form 1040, line 37. A list of providers can be found here.

State Filings (not always free)

Filing your state returns using these programs may, or may not, cost you money (it depends on your state).  The cost of a state filing through software is often around $20 – $40, so your ‘free filing’ can still cost you a bit. One thing I encourage people to do if they already have their 1040 filled out, is to use their state’s online filing system to file for free.  There are pages and pages of special deductions to sift through, but these are often only applicable to a few taxpayers. In the D.C. area for instance, Maryland, Virginia and D.C. all have free online filing through their treasury sites:

VAhttp://www.tax.virginia.gov
DChttps://www.taxpayerservicecenter.com/individual/Ind_Logon.jsp?type=100
MDhttp://individuals.marylandtaxes.com/filinginfo/efile.asp

Getting your Taxes Prepared for Free

The VITA program offers free in-person tax preparation for people earning less than $50K.  Taxes are prepared by volunteers.  Lines can be quite long, so it’s best to get your taxes done before April rolls around.

Some non-profits organize sessions catering to those eligible for the Earned Income Credit (note that income limits are significantly lower than for the VITA program, often $45K for families and $25K for individuals).  These tax preparation sessions will often be coupled with financial literacy efforts. Here’s an example of D.C.’s EITC program.

Students

Students should check to see if their universities offer free tax preparation services (staffed by volunteers). This can be quite helpful for graduate students receiving grant money and scholarships, since the tax code can be a bit complex in this area.

For Those Over Age 60

The IRS sponsors a free tax preparation program called “Tax Counseling for the Elderly” for people over age 60.  To find a provider, use AARP’s website (you do NOT have to be an AARP member).

Feb 18 12

Doing Your Own Taxes or Using a Preparer

by Bill Varettoni

Doing Your Own Taxes

Software – Tax software programs have improved greatly over the years, but they’re not foolproof. I’ve been preparing people’s taxes for years, and I still find occasional problems when using software.  I suggest to our members that, as they enter their tax information, they think about what effect each entry should have, and then double check that the program is doing what you think it should be doing. Personally, I keep a running tally in a notebook as I prepare people’s taxes, checking to see that each new entry has the effect and magnitude I would expect.  Common spots for difficulties include multiple state tax returns, foreign taxes paid, scholarship income, and partnership income.

Personally, I have a strong preference for owning actual computer software (rather than preparing taxes online). With software, you have the program file, archive PDF, and all other materials available whenever you want (when I prepare taxes for people, I give them all of these to keep).  You don’t need to pay an online service to pull your previous year’s information – the software program pulls it for free. I also often use people’s tax program files to demonstrate the effects of different hypothetical situations (e.g. starting a SIMPLE IRA, or enrolling in graduate school), to estimate the next year’s tax bill, and to amend a previous return. With online accounts, you often don’t have the freedom to experiment without permanently changing your one stored tax file.

Using IRS forms to e-file – For those brave souls preparing their taxes without the aid of a computer program, the IRS offers electronic fillable forms.  These are identical to paper-based forms, but they have built in calculations and can be e-filed for free.

When to file – Congress and the IRS are often quite busy changing and tweaking things late in the calendar year.  As such, the tax software companies have little time to debug the final version of their software. For this reason (and a few others), I don’t even start preparing people’s taxes until February each year, after the IRS has issued its clarifications and the software makers have used early filers to find the bugs in their software.

Using a Paid Preparer

All tax preparers need to be registered with the IRS. We each have a unique Preparer Tax Identification Number (PTIN) that we use when signing people’s taxes.  If your preparer does not sign with a PTIN, s/he is not a legitimate preparer.

Beginning with this tax season, the IRS has instituted a preparer competency exam and annual continuing education requirements. On the cost side, the makers of tax preparation software for preparers are charging significant fees for each return that is e-filed. The result of these two developments will likely be far fewer “mom and pop” tax preparers this year, and a rise in the cost of return preparation.  I would also expect to see a lot more tax scams and unlicensed preparers refusing to sign returns and provide a PTIN.  Beware!!!

Jan 31 12

February Special for Couples

by Bill Varettoni

With hearts and flowers all around, talking about joint finances might seem like a real buzz kill.  But if you are serious (or even merely serious-ish) about your significant other, getting your finances in order now can substantially increase your happiness going forward. And we all know that money is one of the top topics couples argue about (money and sex compete for the top spot in most polls).

Even if you split household bills and keep everything separate, it makes sense to get your respective financial lives in shape given the chance that you might be together long term.  And even if you don’t stay together, at least you’ll both have a better handle on your personal affairs.   See our recent blog on “Hooking up … financially” on how current trends in coupling and relationship development are making joint financial planning all the more critical.

At Community Ladders, we are huge fans of long-term, ongoing financial coaching (it’s one of the main reasons we exist). As such, we want to reward couples that stick it out by giving this offer:

Any couple that joins Community Ladders in the month of February 2012 will get the month of February 2013 for free.

We hope this will encourage people to invest in themselves – and each other!!!

Jan 29 12

Feb. 2 – Community Ladders’ (社区扶梯) founder speaks in Beijing, China about launching and running a social business

by Bill Varettoni

Spark:Her and FYSE.org present a seminar with Bill Varettoni: Designing and Running a Social Enterprise on a Super-Small Budget – A Case Study of Community Ladders (社区扶梯)

  • Starts Thursday February 2, 2012 07:30 PM
  • Address Jianguomen, Details upon RSVP
  • RSVP required: Please email to events@fyse.org
About The Event

[Beijing] Spark:Her with Bill Varettoni: Designing and Running a Social Enterprise on a Super-Small Budget – A Case Study of Community Ladders
Thursday February 2, 2012
 
In this talk, Bill Varettoni will discuss the planning, launch, and first 15 months of operations of his social enterprise, Community Ladders.  Even though the business is based in the United States, the talk will focus on experiences and lessons learned applicable to social enterprises in China and many types of businesses.
Among the issues covered:
– Defining the problem
– Deciding on a social business versus a non-profit
– Dealing with skepticism and taking on personal risk
– Planning in stages
– Mistakes and breakthroughs
– Launching and running on a shoe-string budget (i.e. creating a cheap proof of concept)
– Setting expansion goals
About Bill Varettoni
Bill Varettoni is the Founder and President of Community Ladders. Leveraging a broad professional background in international development, small business advising, and government service, Bill created Community  Ladders because he saw a persistent problem lacking a practical solution. Bill started as an entrepreneur at age 11, and has relished building things and solving problems ever since.  
About Community Ladders
According to last week’s New York Times, “Nobody has figured out a way to consistently give large numbers of people reasonably priced financial advice across all areas of their life and to do so in an ethical manner.” Community Ladders was created 15 months ago to specifically address this problem.
Community Ladders provides very affordable, one-on-one, holistic financial planning services to Americans of all ages and incomes. A social business devoted to the long-term protection of consumers, we aspire to use our collective membership to negotiate for better and safer financial products.  Community Ladders is a trusted partner in helping people build and maintain wealth and financial security.
About FYSE/ Spark:Her
FYSE identifies  and supports  exceptional social entrepreneurs  implementing sustainable and impactful solutions. Our new program Spark:Her has the mission to inspire, empower and accelerate women social entrepreneurs. More info at www.fyse.org