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					                                      M  T
                                                                                                The Register-Mail                                                                                       SECTION



                                                                                                                                                                                                        E
                                                                                                                                                                                                        SUNDAY
                                                                                                                                                                                                    Feb. 4, 2007




                                                                      M Y M                                                                               2006 TAX TIME

Debt got
                                                                                                                                                                              By The Associated Press


                                                                                                                                                                             F D
                                                                                                       The first step is acknowledging that your
                                                                                                                                                                  April 17, 2007. The usual deadline, April
                                                                                                    financial situation is destroying your quality              15, is on a Sunday, and the next day, April




you down?
                                                                                                    of life. The second is to do something about it.            16, is Emancipation Day in the District
                                                                                                                                                                of Columbia, a legal holiday under a new
                                                                                                                                                                city law. Although it’s not a federal holiday
                                                                                                                                                                — and the IRS will be open that day — the
                                                                                                                                                                agency has extended the tax filing deadline
                                                                                                                                                                to April 17 because of a federal statute that
                                                                                                                                                                says District of Columbia holidays have a
                                                                                                                                                                nationwide impact. This change came too
                                                                                                                                                                late to be reflected in IRS forms and pub-
                                                                                                                                                                lications for the 2006 tax year, which had

There’s                                                                                                                                                         already been printed.

                                                                                                                                                                            F E
no time                                                                                                                                                          Automatic six-month extension to
                                                                                                                                                                Oct. 15, as long as Form 4868 is filed by the
                                                                                                                                                                April deadline.

like the                                                                                                                                                                       W’ N
present
                                                                                                                                                                    For taxpayers who itemize, there are
                                                                                                                                                                stricter rules for charitable deductions of
                                                                                                                                                                household goods; items donated after Aug.
                                                                                                                                                                17, 2006, must be in “good used condition or

to get                                                                                                                                                          better” to qualify for the deduction.
                                                                                                                                                                    Inflation-related increases for: personal
                                                                                                                                                                and dependent exemptions; standard deduc-


finances
                                                                                                                                                                tions; thresholds at which certain tax ben-
                                                                                                                                                                efits begin to phase out; maximum income
                                                                                                                                                                for claiming earned income credit; slight
                                                                                                                                                                increase in income threshold for phase-out

under                                                                                                                                                           of deduction for IRA contributions by joint
                                                                                                                                                                filers already covered by a retirement plan
                                                                                                                                                                at work.


control
                                                                                                                                                                    Age at which teens are subject to the
                                                                                                                                                                “kiddie” tax on investment income is raised
                                                                                                                                                                to under 18; it had been under 14.
                                                                                                                                                                    Telephone tax rebate: Taxpayers can
                                                                                                                                                                claim a standard refund of $30 to $60,
                                                                                                                                                                depending on the number of exemptions
 BY ROBERT J. HAWKINS                                                                                                                                           checked on the tax return. (If you have
   Copley News Service                                                                                                                                          records of actual taxes paid for service



L
        iving from                                                                                                                                              billed between March 2003 and July 2006,
        paycheck to                                                                                                                                             you may claim that amount; file Form 8913.)
        paycheck is as                                                                                                                                             Even if you aren’t required to file a tax
        hard as ever.                                                                                                                                           return — perhaps your income was too low
But bankruptcy just                                                                                                                                             — you can still get the refund. There’s a
isn’t the quick and                                                                                                                                             new form, 1040 EZ-T, for this purpose.
easy solution it once
was for crawling out                                                                                                                                                     E T B
from under that mound
of debt — not since the                                                                                                                                           Several popular tax breaks that expired
slyly named Bankrupt-                                                                                                                                           at the end of 2005 were restored by Con-
cy Abuse Prevention                                                                                                                                             gress in its final days last year. Among
and Consumer Protec-                                                                                                                                            them: a deduction of up to $4,000 for quali-
tion Act of 2005.                                                                                                                                               fying higher education tuition and fees,
  Oh, it’s still possible, but                                                                                                            Copley News Service
                                                                                                                                                                and a deduction of up to $250 for teachers
much harder. In the four weeks                                                                                                                                  who pay for school supplies with their own
leading up to the new rules                                                                                                                                     money.
around 750,000 bankruptcy                bringing your debt under con-             require some legwork. Credit        for gas and food.                          Also extended was the deduction for
applications were filed. In the          trol: You.                                cards, loans, mortgages, insur-        Take a look, especially, at           state and local sales taxes, which primar-
11 months that followed, only               What you can do on your                ance, child support, alimony        your credit card interest rates.         ily benefits people living in states where
375,000.                                 own is really amazing.                    - these are the obvious ones.       Chances are, if you’ve missed            there is no state income tax.
  If you have the means to                  First, it is surprising how            Now, list (from your pay stub,      some payments the interest
pay off your debts, you’re
not going to be able to simply
                                         little grasp we often have over           perhaps) contributions to           rates are so high they feel like                      E C
                                         our own financial situation.              automatic savings, 401(k)s,         extortion. Incredible as this
dump them any more. Addi-                Every month, when the last                IRAs, stocks, and the like. And,    may sound, you can call your               Available for certain energy-saving
tionally, new rules kicked in            bill is paid, or partially paid           finally, your personal expenses     credit card firm and ask for a           home improvements and for hybrid and
Oct. 20, 2006 that enable the            or even ignored “just this                like food, clothing, utilities,     lower rate. You’ve got better            alternative fuel vehicles.
government to more closely               one time,” we feel like we’ve             entertainment, dining, dues,        than a 50-50 chance of getting
scrutinize bankruptcy applica-
tions for fraud.
                                         dodged a bullet. And then
                                         turn our attention to scrimp-
                                                                                   tuitions and miscellaneous
                                                                                   items.
                                                                                                                       it if you do it right. Find a
                                                                                                                       copy of Scott Bilker’s “Talk
                                                                                                                                                                              F E-:
  But is bankruptcy really the           ing and scraping and trying                  Add up both sheets and see       Your Way Out of Credit Card                The IRS’ Free File Alliance with tax
best solution for you? Because           to get enough ahead to meet               how far apart you really are.       Debt” at your local library and          software companies allows taxpayers with
of the implications for your             the onslaught of bills for next           Now lets go over those expense      follow his script.                       incomes of $52,000 or less to prepare and
credit for years to come, it is          month.                                    items, one by one, and ask             While you are at it, go to the        file returns online for free if they access
worth your while to explore                 Face it, that’s a pretty lousy         some hard questions.                Web site www.annualcreditrep             the program through the IRS Web site at
other ways of managing debt              way to live.                                 First, think about what you      ort.com and request a copy of            www.irs.gov.
before seeking protection                   Here is a way to start tak-            can do without and get rid of       your credit report from one of
under bankruptcy. And, yes,
there are plenty of options
                                         ing control of your life: Grab
                                         two blank sheets and write
                                                                                   it. For example, if you can’t
                                                                                   pay your bills you might con-
                                                                                                                       the three nationally reporting
                                                                                                                       agencies -— Experian, Equifax
                                                                                                                                                                                  R
open to you, all of which                “Income” at the top of one and            sider fewer dinners out. If you     and TransUnion. You have a                 For the first time, the IRS will split a
require work, discipline and             “Expenses” at the top of the              walk around with a couple           right to a one free copy from            taxpayer’s refund into three different
some tenacity on your part to            other.                                    of hundred dollars in “mad          each agency once a year under            financial accounts, such as checking, sav-
make them happen.                           Listed income should be                money” in your wallet, leave it                                              ings and retirement accounts; file Form
  Let’s start with the key to            pretty easy; your expenses                in the bank. Start paying cash                        See DEBT, Page E6      8888.
                                                                                                                                                                  It should take no more than two weeks to
                                                                                                                                                                receive a refund from a tax return filed elec-
                                                                                                                                                                          ,
                                                                                                                                                                tronically no more than eight weeks for a
                                                                                                                                                                paper-filed return for which the filer is receiv-
                                                                         I T                                                                         ing a paper check from the government.
                                                                                                                                                                  To check refund status go to the IRS



                                                                          Getting defensive
                                                                                                                                                                Web site at www.irs.gov and click on the
                                                                                                                                                                “Where’s My Refund?” link on the left.
                                                                                                                                                                When prompted, enter your Social Security
                                                                                                                                                                Number, filing status and exact amount of
                                                                                                                                                                the refund shown on your 2006 tax return.
                                                                                                                                                                Or, call the refund hotline at 1-800-829-1954.
                                                                          Take proactive steps to                   “They did five different transac-

                                                                          protect your identity,
                                                                                                                  tions in a month’s time, so I didn’t
                                                                                                                  know that this was going on,” Brit-                  IRS F/P
                                                                                                                  tingham said.
                                                                                                                                                                  Download these at www.irs.gov by navi-
                                                                          personal information                      She made the mistake of not
                                                                                                                  checking her statement in October.            gating to “Forms and Publications” — or
                                                                                      BY CIGI ROSS                Instead, she wrote her usual check            order by mail by calling 1-800-829-3676.
                                                                                     The Register-Mail
                                                                             GALESBURG — Lori Britting-
                                                                                                                  to the credit card company without
                                                                                                                  verifying all the transactions reg-                        O T H
                                                                          ham has first-hand experience with      istered to her account. She never
                                                                                                                  noticed the checks were missing                 www.irs.gov. This is a robust Web site
                                                                          identity theft.                                                                       with links to every tax topic. There are
                                                                             The East Galesburg resident          from her mailbox.
                                                                                                                    “I never look at those checks, I            interactive tools for calculating withhold-
                                                                          became a victim in September                                                          ing and earned income credit, along with
                                                                          when someone stole checks sent to       just tear them up and throw them
                                                                                                                  away,” Brittingham said. “They                interactive history lessons, games and “Tax
                                                                          her from her credit card company                                                      Trivia.”
                                                                          out of her mailbox. In November         didn’t come with the bill so I
                                                                          she noticed $6,300 of extra charges
                                                                          on her statement.
                                                                                                                  would’ve never known that I didn’t
                                                                                                                  get them.”                                                 P T H
                                                                             “(Whoever did it) called the cred-     Brittingham was able to prove
                                                                                                                  she hadn’t used the checks and                  1-800-829-1040 for individuals, 1-800-829-
                                                                          it card company and said they were                                                    4059 (TDD) for those with hearing impair-
                                                                          me,” Brittingham said. “They did        the charges were removed from
                                                                                                                  her account. And she learned her              ment, 1-800-829-4933 for businesses.
                                                                          it over the phone. Then the money                                                       However, it can take time to get through.
                                                                          was transferred from my credit          lesson about protecting personal
                                                                                                                  information.                                  To reduce the time taxpayers wait to speak
                                                                          card to their bank account.”                                                          to IRS representatives, the agency blocked
                                                                             Brittingham said the only infor-       Chris Kieffer is the vice presi-
                                                                                                                  dent for electronic banking for               more calls in 2006 than it did in 2005.
                                                                          mation the thief needed was her
                                                                          mother’s maiden name, which peo-
                         Illustration by KEN EXUM/The Register-Mail       ple who know her knew as well.                              See IDENTITY, Page E2                 www.register-mail.com
E2               The Register-Mail, Galesburg, Ill.                               Sunday, Feb. 4, 2007

                                                                                                                                   MONEY & TAXES
Identity                                                      FEDERAL TRADE
                                                              COMMISSION TIPS
                                                                                                                                                                                 W’ N  
From Page E1

   First Bank in St. Louis.
He said people tend to be
                                                               Before you reveal any
                                                              personally identifying information,
                                                              find out how it will be used and
                                                              whether it will be shared with
                                                                                                                    Phone users, energy savers get breaks
more reactive than proac-
tive when it comes to pro-                                    others. Ask about the company’s                       But parents can lose GATHER RECORDS FOR TAX PREPARATION                                                                                lar equipment in 2006 can
                                                                                                                                                                                                                                                           claim the residential ener-
                                                              privacy policy: Will you have a
tecting themselves from
credit card fraud and iden-                                   choice about the use of your                          on ‘kiddie tax’       A checklist of the most common records you’ll need to prepare your                                               gy credit. Taxpayers can
                                                                                                                                                                                                                                                           take a credit for 10 percent
                                                              information; can you choose to                                                               2006 taxes, whether you use tax software, a professional tax preparer or
tity theft.                                                                                                                                                                                                                                                of the cost, though there’s a
                                                              have it kept confidential?                                 BY EILEEN PUTMAN                  an old-fashioned paper tax return:
   “The biggest things I                                                                                                                                                                                                                                   maximum, and specific lim-
                                                               Read the privacy policy on any                            The Associated Press              Copy of 2005 tax return.
tell people to be aware of                                                                                                                                                                                                                                 its apply to certain equip-
                                                              Web site directed to children. Web                      WASHINGTON, D.C.                      Identifying documents, such as a Social Security card or driver’s                             ment.
is stay in touch with your
                                                              sites directed to children or that                    — Telephone customers,                    license, for you and your spouse.                                                               People who purchased
bank account, review credit
card and bank statements                                      knowingly collect information from                    energy-savvy homeown-                   W-2s from all employers.                                                                      hybrid or other alternative-
and make sure there’s noth-                                   kids under 13 must post a notice                      ers and parents of older                Forms 1099, 1099-DIV, 1099-R and 1099-G showing dividend and                                  fuel vehicles can also take a
ing on them you don’t rec-                                    of their information collection                       teens should pay special                  interest paid to you in 2006 as well as any refund, credit, or offset of                     credit, though it’s reduced
ognize, and annually pull a                                   practices.                                            attention at tax time. Many               state and local taxes.                                                                       if the manufacturer has
credit report on yourself,”                                    Put passwords on your all your                      changes affecting 2006 tax              Receipts indicating the state and local taxes, real estate taxes and                          sold 60,000 or more such
Kieffer said. “These are                                      accounts, including your credit                       returns are aimed squarely                personal property taxes you paid in 2006.                                                    vehicles. A list of specific
proactive steps any con-                                      card account, and your bank                           at you.                                 Form 1098 for home mortgage interest and points.                                              vehicles and their credits
sumer can take.”                                              and phone accounts. Avoid using                         On balance, the news is               Receipts and documentation for charitable contributions and gifts                             is on the Internal Revenue
   For credit card offers that                                easily available information — like                   good.                                     (cash and non-cash).                                                                         Service Web site at http:
are sent through the mail,                                    your mother’s maiden name, your                         Even if you don’t have                Income receipts from rental real estate, royalties, partnerships, S                           //www.irs.gov.
Kieffer suggests a shredder.                                  birth date, the last four digits of                   to file a tax return you can              corporation and trusts.                                                                         Most taxpayers can claim
Most of those offers will have                                your SSN or your phone number                         get a refund on certain tele-           Records of unemployment compensation, Social Security benefits or                             a one-time refund on fed-
a lot of your personal infor-                                 — or obvious choices, like a series                   phone taxes.                              other income.                                                                                eral excise taxes for long-
mation on them already    .                                   of consecutive numbers or your                          And late last year, Con-              Records of medical and dental expenses if you think you can meet the                          distance telephone service
   “Protect that information                                  hometown football team.                               gress reinstated several                  7.5 percent adjusted gross income threshold required for this deduction.                     — whether for landline, cell
about yourself,” Kieffer                                       Minimize the identification                         popular tax breaks for the              Documentation of casualty and theft losses.                                                   phone or Voice over Inter-
said. “It’s just as easy for                                  information and the number of                         middle class, including a               Remember to keep a copy of your tax return and supporting                                     net Protocol. The govern-
somebody to tape it togeth-                                   cards you carry to what you’ll                        deduction of up to $4,000                 documents for at least three years from the date you file the return.                        ment stopped collecting the
er as it is for you to tear it                                                                                      for higher education tuition                                                                                                           3 percent tax after July 2006
                                                              actually need. Don’t put all your
apart once or twice.”                                                                                               and fees. The provision,                                                                                                               after businesses repeatedly
                                                              identifying information in one                                                              widely available.                              home’s energy conserva-
   Kieffer said online bank-                                                                                        which expired at the end of                                                                                                            fought the tax and won.
                                                              holder in your purse, briefcase or                    2005, was designed to help              And, there’s a bit of bad                    tion, you may be able to
ing is safe on bank sites,                                                                                                                                                                                                                                    You can claim either a
                                                              backpack.                                             taxpayers whose incomes               news for packrats. Taking                      take a residential energy                         standard refund of $30 to
but to be cautious of fake
                                                               Keep items with personal                            put them beyond the reach             a tax deduction for donat-                     credit. A credit is a dol-                        $60, depending on the num-
e-mail correspondence from
banks, called phishing.                                       information in a safe place. When                     of two education tax cred-            ing the deteriorating junk                     lar-for-dollar reduction                          ber of exemptions checked
These e-mails claim to be                                     you discard receipts, copies of                       its that primarily help mod-          in your attic to charity is                    in tax liability, whereas a                       on your tax return, or the
your bank trying to secure                                    credit applications, insurance                        erate- and lower-income               harder. Household goods                        deduction only reduces the                        actual excise taxes paid
personal information about                                    forms, physician statements,                          families.                             and clothing donated after                     income against which tax                          for service billed between
you. They will link you to                                    bank checks and statements,                             Lawmakers also rein-                Aug. 17, 2006 must be in                       is assessed.                                      March 1, 2003 and July 31,
a site that looks similar                                     expired charge cards, credit offers                   stated a deduction for state          “good used condition or                          Homeowners who pur-                             2006 if you have phone
to your banks site. Kieffer                                   you get in the mail and mailing                       and local sales taxes, which          better” to qualify for the                     chased insulation, certain                        bills documenting the tax.
said banks will never send                                    labels from magazines, tear or                        primarily benefits people             deduction, available to tax-                   energy-efficient windows,                         You don’t have to itemize
e-mails like that to your pri-                                shred them. That will help thwart                     living in states without an           payers who itemize.                            hot water boilers, furnaces,
vate account.                                                 any identity thief who may pick                       income tax. Also restored               But if you improved your                     air conditioners or simi-                                                See NEW, Page E4
   “Banks are never going to                                  through your trash or recycling                       was a deduction of up to
validate through that mech-                                   bins to capture your personal                         $250 for teachers’ expenses.
anism,” he said. “If some-                                    information.                                            But Congress also took
thing doesn’t look right,                                      Consider ordering a copy of                         something away from fam-
don’t use it. If you have                                     your credit report from each of                       ily pocketbooks last year
questions ask a branch                                        the three major credit reporting                      — raising the age at which
employee.”                                                    agencies every year. Make sure                        teens are subject to the
   For online shoppers, Kief-                                 it’s accurate and includes only                       “kiddie” tax, the tax on the
fer advises getting to know                                   those activities you’ve authorized.                   child’s investment income
the merchant.                                                 Credit reporting agencies can’t                       that must be figured at the
   “Make sure it’s somebody                                   charge you more than $9 for a                         parent’s top rate instead of
reputable,” he said. “Fraud                                   copy, and in some states your                         the child’s generally lower
happens after the fact when                                                                                         rate.
we don’t know where we’re
                                                              credit report is free.
                                                               Use a secure browser when                             Before, only those under                    � �������������������������������������������������������
shopping or who we’re                                                                                               14 were subject to the high-
using as a vendor.”
                                                              shopping online to guard the
                                                              security of your transactions.                        er tax; now, those under 18                           � �������������������������������������������
   And Brittingham has                                        When submitting purchase                              are included. That change                                                   �
                                                                                                                                                                                                �������������
some advice, too. After her                                   information, look for the “lock”                      may ensnare earnings on
experience she had the                                        icon on the browser’s status bar                      certain college funds or                               � �����������������������������������������������������
                                                                                                                                                                           �
limit on her credit card low-                                                                                       savings vehicles started
                                                              to be sure your information is                                                                         �                                                                                                       �
                                                                                                                                                                     � ���������������������������������������������������������������������������������������������������������������
ered to only $300.                                                                                                  before taxpayer-friendly                         �                                                                                                    �
                                                                                                                                                                     � ���������������������������������������������������������������������������������������������������� ���������������
                                                              secure during transmission.
   “Never have a limit that’s                                                                                       529 college plans became
more than you’re willing to
lose,” she said. “Whatever                                  nightmare.”



                                                                                                                                                 �������������
you might spend if you                                                   
were somewhere and need-                                      On the Web:
ed to buy something.”                                         Annual Credit Report
   And she’s learned anoth-                                 allows you to check your
er lesson.                                                  credit for free every 12

                                                                                                                                                    �
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   “I will read every state-                                months
ment that I get,” she said.                                   www.annualcreditreport
“It’s just been a complete                                  .com


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                                                                                                                                                                                                                                    The Register-Mail, Galesburg, Ill.             Sunday, Feb. 4, 2007                 E3

                                                                                                                                                            MONEY & TAXES
         IRS T                                                                                                                                                                                    P  C
Instructions
for last-minute                       Don’t delay on financial aid applications
tax changes                           School deadlines
  WASHINGTON, D.C.
(AP) — Here are instruc-
                                      often sooner than
tions from the Internal
Revenue Service reflect-
                                      federal date
ing tax changes Congress
passed in December. The                              BY JANE CARLSON
changes came too late to                                The Register-Mail
be included in the 2006 tax             GALESBURG — In the
forms, which had already              race to find ways to pay for
been printed.                         college, using the Internet
  The instructions are                to apply for federal financial
especially important for              aid and search for scholar-
taxpayers who prepare                 ship opportunities can help
their own taxes and file              students and parents get up
paper returns, as they may            to speed.
have already received the               Financial aid experts say
IRS printed tax packet.               the quicker families com-                                                                                                                                                                            Deb Hroziencik looks over financial aid information during a sem-
  Updated forms, publica-             plete the Free Application                                                                                                                                                                           inar Jan. 25 in the GHS learning center.
tions and instructions are            for Federal Student Aid
also available for download
and/or printing at the IRS
                                      after Jan. 1, the better. Fill-
                                      ing out the FAFSA online
                                                                                                                                                                                                                                            FAFSA ON THE WEB
Web site, www.irs.gov.                can save time in several                                                                                                                                                                                  Students who plan to attend college in the 2007-08 school year should
Filing deadline                       ways.                                                                                                                                                                                                 fill out the FAFSA as soon as possible. Here are the steps for completing
                                        “The FAFSA online is                                                                                                                                                                                the application online:
   It’s April 17, 2007. The
usual deadline, April 15,             quicker because you don’t                                                                                                                                                                             1. Go to www.pin.ed.gov to get a U.S. Department of Education personal
                 ,
is on a Sunday and April              wait for processing or mail-                                                                                                                                                                          identification number.
16 is Emancipation Day in             ing,” said Lisa Hanson,                                                                                                                                                                               2. Go to www.studentaid.ed.gov/docs to find out what documents you’ll
the District of Columbia,             director of financial aid at                                                                                                                                                                          need.
a legal holiday under a               Carl Sandburg College.                                                                                                                                                                                3. Before filling out the FAFSA online, you can complete a FAFSA on the
new city law. Although it’s             The built-in editing sys-                                                                                                                                                                           Web Worksheet at www.studentaid.ed.gov/worksheet. This step is for
                        ,
not a federal holiday the             tem for FAFSA on the Web                                                                                                                                                                              students and parents who feel more comfortable referring to something
IRS has extended the tax              means it’s less likely an                                                                                                                                                                             filled out on paper before going online to complete the application.
filing deadline to April 17           application will be missing                                                                                                                                                                           4. Fill out the FAFSA at www.fafsa.ed.gov.
because a federal statute             information and be sent                                                                                                                                                                               5. Check your e-mail for a response and further instructions.
says District of Columbia             back. The online version                                                                                                                                       KENT KRIEGSHAUSER/The Register-Mail    Source: U.S. Department of Education
holidays have a nationwide            also features “skip logic,”
                                                                                                                       Terry Jackson, director of financial aid at Knox College, speaks
impact.                               which eliminates the need
                                                                                                                       to a group of parents and students in the Galesburg High School                                                     al colleges.                               tance Commission Web site,
                                      to answer additional ques-
Sales tax deduction                                                                                                    Learning Center about financial aid. Jackson advises getting an                                                       “Families need to be plan-               www.collegezone.com.
                                      tions that may not pertain to
                                                                                                                       early start on financial aid applications.                                                                          ning ahead,” Hanson said.                    The ISAC Web site also
   Taxpayers who itemize              originals.
deductions can choose to                Hanson and Terry Jack-                                                                                                                                      ents should watch out for                Parents of high school                   features financial aid
claim the state and local             son, director of financial                                                          FINDING SCHOLARSHIPS                                                      scholarships or services               juniors and younger stu-
                                                                                                                                                                                                                                           dents who are curious about
                                                                                                                                                                                                                                                                                      information and scholar-
                                                                                                                                                                                                                                                                                      ship listings. Hanson and
sales taxes they paid in              aid at Knox College, hold                                                                                                                                     that claim “guaranteed win-
2006, instead of any state            informational meetings at                                                           ON THE WEB                                                                nings,” have an unclear or             what the FAFSA would                       Jackson also recommend
and local income taxes they           Galesburg High School each                                                                                                                                    unexplained application                determine as their financial               www.fastweb.com and
                                                                                                                          FASTWEB Scholarship Search                                                                                       contribution can use a con-                www.finaid.org as reputable
paid.                                 year for high school juniors                                                         www.fastweb.com                                                         process or list only a phone
   This option is available           and seniors and their par-                                                                                                                                    number or post office box,             tribution calculator online,               online resources for finan-
                                                                                                                          Illinois Student Assistance                                                                                      such as one available at                   cial aid and scholarship
to taxpayers nationwide,              ents.                                                                               Commission                                                                rather than a full address.
though it’s primarily                   The next meeting is a                                                                                                                                         Those seeking financial              the Illinois Student Assis-                information.
                                                                                                                           www.collegezone.com
designed to benefit resi-             FAFSA Completion Work-                                                                                                                                        aid also should be aware of
                                                                                                                          General Financial Aid
dents of states without state         shop, to be held at 6 p.m.                                                                                                                                    scholarships or services that                                    ��������������
                                                                                                                          Information
and local income taxes.                          ,
                                      Thursday Feb. 15, in the                                                                                                                                      promise large amounts of                                          �����������
Either amount can be                                                                                                       www.finaid.org
                                      learning center at Galesburg                                                                                                                                  money without a defined set
shown on Schedule A, Line             High School. Hanson and                                                                                                                                       of criteria.
5, labeled “State and local           Jackson will walk parents                                                       have to get on the right Web                                                    “If it sounds too good to
income taxes.”
                                                                                                                                                                                                                                                        �������������
                                      and students through the                                                        site.”                                                                        be true, it probably is,” Han-               ������������������������������������
                                                                                                                                                                                                                                                                                             ������������������������



                                                                                                                                                                                                                                                                                             ���
   If you choose to claim the         process of completing the                                                         Another online pitfall can                                                  son said.                                             ��������������������
sales tax deduction, enter            FAFSA online.                                                                   be Web sites that charge                                                        In addition to completing               ��������������������
“ST” on the dotted line to              Hanson said parents and                                                       fees to find scholarships                                                     the FAFSA as early in the                ��������������������������������
the left of Line 5.                   students who complete the                                                       for students. Hanson said                                                     year as possible, students               ������������������������������
   The IRS will issue Pub-            FAFSA online from home                                                          the majority of the Web                                                       and parents should also
lication 600, containing              should make sure they are                                                       sites featuring scholarship                                                   visit the Web sites of pro-
instructions for figuring the         at the federal FAFSA Web                                                        opportunities use the same                                                    spective colleges — or call
deduction and the sales tax           site (www.fafsa.ed.gov).                                                        database and the informa-                                                     their financial aid offices
tables for all 50 states and          Other Web sites using the                                                       tion is free.                                                                 — to check each college’s
the District of Columbia.             FAFSA name have popped                                                            “There are a number of                                                      deadline date for applying
Tuition and fees                      up online and charge fees of                                                    free searches out there,”                                                     for financial aid.
                                      up to $80 to process applica-                                                   Hanson said. “You really                                                        Some colleges have dead-
   The deduction for up to
                                      tions.                                                                          shouldn’t pay a high                                                          lines as early as February  ,
$4,000 of tuition and fees
                                        Hanson said it’s important                                                    amount.”                                                                      although the federal dead-
paid to a post-secondary
                                      to remember that FAFSA                                                            There are other signs a                                                                           .
                                                                                                                                                                                                    line is not until July Miss-
institution is claimed on
                                      stands for Free Application                                                     Web site, print or online                                                     ing those deadlines means
Form 1040, Line 35, which is
                                      for Federal Student Aid.                                                        advertisement or scholar-                                                     students could be missing
the line labeled, “Domestic
                                        “It is free to file,” said                                                    ship-finding service is a                                                     out on the institutional
production activities deduc-
                                      Hanson. “You just have to                                                       scam. Students and par-                                                       grants provided by individu-
tion.” Do not use Form
1040A.
   If claiming the tuition
and fees deduction, enter
“T” on the dotted line to
                                                                                                                                                                                                    �����������
                                                                                                                                                                                                             ����� �������
                                                                                                                                                                                                                   �
                                                                                                                                                                                                       �����
                           .
the left of that line entry If
claiming both the domestic                                                                                                                                                                          ��                     ��
production activities deduc-
tion and the tuition and
fees deduction, enter “B” on
the dotted line and attach a            ������������������������������������                                                                                                                           � ����������������������������
                                                                                                                                                                                                       �
breakdown of the amounts                 �������������������������������                                                                                                                                        �
                                                                                                                                                                                                                � ���������
claimed for each deduction.              ������������������������������                                                                                                                               �
                                                                                                                                                                                                      � ����������������������������
Educator expenses                        �������������������                                                                                                                                        �
                                                                                                                                                                                                    � ������������������������������
   The deduction for up to               ����������������������������                                                                                                                                         �
                                                                                                                                                                                                              � �������������
$250 of out-of-pocket class-             �������������������������       �����
                                                                                                                                                                                       ��� �����            ������������
                                         �����������������������
room expenses paid by                                                 ����������                                                                                                      ������ ��
                                                                                                                                                                                                             � �����������
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                                                                                                                                                                                       �������
                                         ������������������
an educator is claimed on
Form 1040, Line 23, labeled                                                                                                                                                           �������        ������������
“Archer MSA deduction.”                                                                                                                                                                                 � ����������������������
                                                                                                                                                                                                        �                                                     ����������                ���������
Again, do not use Form
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                                       ������������������������������
1040A.                                                                                                                                                                                                 � ����������������
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   If claiming educator


                                          ��������
expenses, enter “E” on the              ��������������������                                                     � ���������������
                                                                                                                 �
line to the left of that line
entry Enter “B” if claiming
      .                                                                                                                                                             � �� � �
                                                                                                                                                                    � ��� �
                                                                                                                                                                  ��� �������
                                                                                                                                                                    �                                                                                                 ��������������������
                                                                                                                                                       � � ����




both the Archer MSA and
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                                                                                                                                                       ��




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                                        �                                                                                                                   �������                  ���
educator expense deduction,                                                                                                                ����
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                                                                                                                                                                                        �
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and attach a breakdown.                ����������������������������������������������������������������������������������������������������������������������������������������������������������


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E4         The Register-Mail, Galesburg, Ill.         Sunday, Feb. 4, 2007

                                                                                                MONEY & TAXES
                                                                  W’ C
                                                                                                                                                             New
                                                                                                                                                                                                       taxpayers who don’t need
                                                                                                                                                                                                       the money, it’s also a
                                                                                                                                                                                                       way for the less well-off


Annual review of coverage can pay off                                                                                                                        From Page E2

                                                                                                                                                             deductions to claim this
                                                                                                                                                             refund.
                                                                                                                                                                                                       to avoid paying income
                                                                                                                                                                                                       taxes on their required
                                                                                                                                                                                                       IRA withdrawals and to
                                                                                                                                                                                                       put the money to chari-
                                                                                                                                                                                                       table use.
Insurance claims                       Sundberg, a partner at Bul-
                                       lis and Sundberg LLC Insur-
                                                                              but if the policy isn’t modi-
                                                                              fied to reflect the improve-
                                                                                                                          policy holder to up the value
                                                                                                                          of their life insurance plans.
                                                                                                                                                               Even if you aren’t
                                                                                                                                                             required to file a tax
                                                                                                                                                                                                         In another IRA-related
                                                                                                                                                                                                       change, military person-
could come up                          ance Services.
                                          “You customize a program
                                                                              ments, the client could be
                                                                              “short changed” if a claim is
                                                                                                                            Doing so would help pay
                                                                                                                          funeral expenses and protect
                                                                                                                                                             return — perhaps your
                                                                                                                                                             income was too low
                                                                                                                                                                                                       nel who received non-
                                                                                                                                                                                                       taxable combat pay in
short if policies                      to their needs and then you
                                       have to review that because
                                                                              filed, Sundberg said.
                                                                                 Business owners should
                                                                                                                          retirement, he said.
                                                                                                                            Vehicle insurance plans
                                                                                                                                                             — you can still get the
                                                                                                                                                             refund. There’s a new
                                                                                                                                                                                                       2006 can include that as
                                                                                                                                                                                                       earned income when fig-
not updated                            it could change,” Sundberg
                                       said. “It’s almost like a
                                                                              follow the same protocol.
                                                                                 “On the business side,
                                                                                                                          also vary and warrant an
                                                                                                                          annual review.
                                                                                                                                                             form, 1040 EZ-T, for this
                                                                                                                                                             purpose.
                                                                                                                                                                                                       uring IRA contributions.
                                                                                                                                                                                                       That gives them a higher
                                       will, it changes all the time.         things change all the time                                  ,
                                                                                                                            Mike Cratty owner of               This year the IRS will,                 IRA contribution, and
     BY REBECCA O’HALLORAN
         The Register-Mail
                                       There’s not one person that’s          from payroll to sales to                    Cratty Insurance Agency   ,        if requested, deposit                     if they put money into a
                                       just like the other one so             acquiring,” Sundberg said.                  said factors such as the num-      a refund directly into                    traditional IRA, it may
  GALESBURG — Insur-                   that’s what you customize.”            “It’s very important to                     ber of drivers constantly          three separate financial                  also mean a higher tax
ance agents recommend                     Sundberg said clients               review that every year.”                    fluctuate.                         accounts, such as check-                  deduction. (Contributions
clients review their policies          might have added an addi-                 Reviewing life insurance                   “People’s needs change,”         ing, savings and retire-                  to Roth IRAs aren’t tax
annually to secure the most            tion or made other home                plans annually is also criti-               Cratty said. “One thing that       ment. The idea, said IRS                  deductible, though they
complete coverage possible.            improvements without                   cal, said Dave Phillips of                  comes to mind on an auto           Commissioner Mark W.                      have tax benefits later
  Policy holders often think           notifying the insurance com-           American Family Insur-                      policy is that they may basi-      Everson, is to encour-                    on.)
they’re covered for every              pany .                                 ance. He said sometimes                     cally have full coverage on        age savings and dampen                      Congress’s restora-
thing and that’s not neces-               The improvements would              an increase in the number                   a vehicle that has been paid       demand for refund antici-                 tion in December of
sarily the case, said Rick             increase the property value,           of dependents will cause a                  off.”                              pation loans, which pro-                  the expired deductions
                                                                                                                                                             vide quick cash for high                  for education expenses
                                                                                                                                                             fees using the expected                   and state and local sales
                                                          C D                                                                             refund as collateral.
                                                                                                                                                               Also for 2006, the usual
                                                                                                                                                                                                       taxes came too late to
                                                                                                                                                                                                       be reflected on 2006 tax
                                                                                                                                                             inflation-related increas-                forms and publications,

New law bars tax write-off for your attic junk                                                                                                               es are in place for person-
                                                                                                                                                             al and dependent exemp-
                                                                                                                                                             tions, standard deduc-
                                                                                                                                                             tions, thresholds at which
                                                                                                                                                                                                       which were printed ear-
                                                                                                                                                                                                       lier in the fall.
                                                                                                                                                                                                         To incorporate the
                                                                                                                                                                                                       changes, the IRS says
Items must be                     claim the item’s fair market                                                              A word of caution about          certain tax benefits begin                that some lines on the
                                       Giving more
                                  value, which is usually less
                                                                               Giving more                               a new provision allowing            to phase out and the max-                 forms will essentially do
in ‘good used                     than its purchase price.
                                      Stretch advises for noncash
                                   Taxpayer deductions taxpayers            Taxpayer deductions for noncash
                                                                                                                         older taxpayers to make a
                                                                                                                         direct transfer of funds from
                                                                                                                                                             imum income for claim-
                                                                                                                                                             ing earned income credit.
                                                                                                                                                                                                       double duty: For example,
                                                                                                                                                                                                       Line 5 of the Schedule
                                   charitable donations totaled more        charitable donations totaled more
condition or better’              to prepare a list of donated
                                   than $9 billion in 2003.
                                  items, including condition                than $9 billion in 2003.
                                                                                                                         their IRA to a qualifying
                                                                                                                                  .
                                                                                                                         charity The amount of that
                                                                                                                                                             There’s a slight increase
                                                                                                                                                             in income threshold for
                                                                                                                                                                                                       A itemized deductions
                                   Amount of noncash                        Amount of noncash                                                                                                          form is for state and local
                                  and estimated fair market                                                              transfer can’t be claimed as a      phase-out of deduction                    income taxes, but taxpay-
       BY EILEEN PUTMAN            charitable
                                  value, anddonations, in rep-
                                                 get a charity              charitable donations, in
                                                                                                                         charitable deduction, though        for IRA contributions by                  ers who choose to deduct
       The Associated Press        billions of dollars, 2003                billions of dollars, 2003
                                  resentative to sign the list                                                           it is excluded from taxable         joint filers already cov-                 state sales taxes instead
                                   Corporate stock                          Corporate stock
  WASHINGTON, D.C.                when the donation is made.                                                             income.                             ered by a retirement plan                 will enter that figure
                                                                 $13.7                                        $13.7
— Clean out the attic. Donate         Donna LeValley a tax,                                                                 For vehicles used in vol-        at work.                                  there.
the junk to charity Take a
                      .            Real estate
                                  lawyer and contributing                   Real estate                                  unteer work, you can deduct           There’s a new wrinkle                     The IRS says it will
tax deduction.                    editor for J.K.5.9  Lasser’s                                 5.9                       either actual operating costs       affecting taxpayers                       send updated instruc-
  Not so fast.                     Clothingguide, suggests
                                  2007 tax                                  Clothing                                     such as gas or oil, or claim        who’ve hit age 701⁄2, the                 tions to taxpayers who
  Congress passed new rules taxpayers visit the Salva-
                                                     5.8                                       5.8                       a flat mileage rate of 14           age at which required                     are mailed tax packets.
for deducting household            Household Web
                                  tion Army items site at                   Household items                              cents per mile for the time         minimum withdrawals                       But with electronic tax
goods and clothing donations http://www.satruck.com/
                                              3.2                                        3.2                             you were engaged in the             from IRAs begin. They                     preparation and filing
in 2006. Unless the item is in    valueguide.asp for estimates
                                   Vehicles                                 Vehicles                                     volunteer work. If the work         can now make a direct                     skyrocketing, not many
“good used condition or bet-      of the 2.3fair-market value of                      2.3                                involved Hurricane Katrina          transfer of up to $100,000                people still receive such
ter” or was donated before        various appliances and other
                                   Other donations                          Other donations                              relief, the rate is 32 cents per    from the IRA to a qualify-                packets.
Aug. 18, 2006, you won’t get      household goods.  5.9                                        5.9                       mile. In either case, parking       ing charity. The amount                     All forms and instruc-
the tax deduction.                                    ,
                                      Realistically LeValley                                                             fees and tolls are deductible.      of that transfer is exclud-               tions are posted on the
  The question, of course, is     notes, noncash can’t verify
                                   Major the IRS charitable                 Major noncash charitable                        Still in effect are rules for    ed from taxable income.                   IRS’ Web site.
what “good used condition”         donations, in thousands, 2003
                                  the condition of every item               donations, in thousands, 2003                donating vehicles that great-         Though this may pri-                               
means. Who defines it, and        to see if it meets the “good
                                   Clothing                                 Clothing                                     ly complicated this deduc-          marily benefit wealthy                      On the Net: www.irs.gov
what proof is needed?             used condition” test. 6,845                                               6,845        tion in 2005. If you donated a
  “It means you can’t give            “It’s only enforceable if                                                          vehicle valued at more than



                                                                                                                                                              ��
                                   Household items                          Household items
away your kids’ blue jeans
that have holes in the back-
side,” said Clint Stretch,
                                  they were to audit everyone
                                                         3,994
                                  or require receipts with the
                                   Cars and other vehicles
                                  tax return,” LeValley said.               Cars and other vehicles
                                                                                                     3,994               $500, your tax deduction is
                                                                                                                         generally limited to the sum
                                                                                                                         the charity receives when it
                                                                                                                                                                              ������
managing principal for tax               857
                                  The main purpose of the                         857                                    resells the vehicle — even                            ���������
                                                                                                                                                                                                  ���������������������
policy at Deloitte Tax LLP   .    new provision, she says, is
                                   Electronics                              Electronics                                  if the vehicle’s fair market
                           ,
“If you give trash away don’t “keeping people on their
                                        541                                     541                                      value is higher. But you can
try to take a deduction.”         toes.”
                                   Food                                     Food                                         deduct the fair market value                                            �����������������������������
  In changing rules for               As for cash donations,                                                             if the charity checks Box 5a,            ��������������������������������������������������������
                                                                                                                                                                                                         �
                                                                                                                                                                ��������������������������������������� � ���������
                                       444                                      444
this deduction, available to      any contributions of $250 or                                                           5b or 5c on Form 1098-C, indi-
taxpayers who itemize, Con-       more should have a written
                                  SOURCE: Internal Revenue Service   AP    SOURCE: Internal Revenue Service       AP     cating that it plans to use or                 �����������������������������������
gress wanted to stop people       acknowledgment from the                                                                improve the vehicle or give it        ��������������������������������������������������
from writing off items of         charity   .                                     It is mandatory to include gov-
                                                                           social clubs or foreignall sources thatto a needy person.                                    �����������������������������������
minimal value such as “used           Don’t forget to subtract             ernments. (But you may be
                                                                       accompany this graphic when repurposing or editing Finally if you claim a
                                                                                                                                    ,                       �
                                                                                                                                                            � ������������������������   � �����������������������������
                                                                                                                                                                                         �
socks and used undergar-          from the deduction any ben- it for publication.
                                                                           able to deduct some contribu- charitable deduction of more
ments,” according to Con-                                                  tions, Chart shows dues, else-
                                <AP> TAX CHARITABLE DEDUCTIONS 013007: like union noncash charitable than $500 for property you
                                  efit you get in return. An                                                                                       ,
                                                                           where on with BC-SPE-Taxes-
gress’ Joint Committee on donations for 2003; 1c x 5 inches; 46.5 mm x 127 mm;the tax return.)
                                  example: You write a check                                                             must attach IRS Form 8283,
Taxation.                                                                     Check IRS
                                Charitable Deductions; SVD/STF; ETA 1:30 p.m. <AP> Publication 78
                                  for $100 to the local zoo,                                                             “Noncash Charitable Con-                   �����������������������������������������������
  While deducting your old        which then sends you a book              to see if the organization is                 tributions,” to your return.
socks may seem like a minor
transgression, such dona-
                                  on elephants valued at $20.              listed as a qualifying char-
                                  Your tax deduction is limited ity There’s also an online
                                                                              .
                                                                                                                         And taxpayers donating an
                                                                                                                         item valued at more than
                                                                                                                                                                    ���������������������
tions add up. As recently         to $80.                                  “Search for Charities” tool                   $5,000 must have an apprais-        �� ����������������������������������������������������������
as the 2003 tax year, the             Speaking of checks, it’s             on the IRS Web site at http:                  er sign Part III of Section B
IRS reported that taxpayer                                                 //www.irs.gov. Also, church-
                                                                                                                                                             ����� �������������������������������������
                                  not unusual for charities to                                                           of Form 8283.
deductions for used clothing      wait months before cashing               es, synagogues, temples,                         For more information on          ����                                      �������������������            ������ ����
and household items totaled       yours. No matter — a check               mosques and government                        charitable deductions, see                      �
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                                                                           agencies are eligible to                                                                      �
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more than $9 billion.             is considered delivered on                                                             IRS Publications 526, “Chari-
  Household items donated                                                  receive deductible donations, table Contributions,” and                           ���������������������������������
                                  the day you mail it. So even
after Aug. 17, 2006, must now     if it isn’t cashed until 2007, it even though they may not be                          561, “Determining the Value         ����� ������ �������������
                                                                                                                                                                              � �������������
be in decent shape to qualify     counts as a 2006 donation if             listed in Publication 78.                     of Donated Property     .”          �����
as a deduction. There’s an        you sent it in 2006.
exception: Taxpayers can              And although donating
claim a deduction of more         to your favorite cause may
than $500 for any single item, seem the charitable thing
                                                                                           �
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                                                                                             � ������              �
                                                                                                                   � ��  � ������� � ��
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regardless of condition, as       to do, many organizations                                 �����������������������������������������������
long as a qualified appraisal     don’t qualify for purposes of
of the item is included with      this deduction. Among them:                            ���������������������������������
the tax return.                   political campaigns, political                                            �������������                                                 ������������������������������������������������
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goods, the IRS says you           organizations, civic leagues,                                                                                                        �����������������������������������������������������
                                                                                                     �
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ity if possible, a receipt that   commerce, sports clubs,                                       � �����������������������������������
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                                                                                                                                                               The Register-Mail, Galesburg, Ill.   Sunday, Feb. 4, 2007                          E5

                                                                                                MONEY & TAXES
                                                             P R                                                                                           Kiddie tax now ensnares more
E-filing getting easier, speeds refund                                                                                                                                 teens’ investment income
                                                                                                                                                                            BY EILEEN PUTMAN
                                                                                                                                                                            The Associated Press
                                                                                                                                                                                                        die tax works: If a child
                                                                                                                                                                                                        is under 18, he or she is
                                                                                                                                                                                                        allowed to have $1,700 in
                                                                                                                                                                         WASHINGTON, D.C.
IRS offers Free File            for federal e-filing. If your
                                adjusted gross income is                      Less taxing
                                                                                                                          and routing numbers for
                                                                                                                          Less taxing
                                                                                                                          direct deposit of refunds.                   — A nasty surprise for           investment income before
                                                                                                                                                                       many taxpayers is mas-           the kiddie tax kicks in.
service for those               $52,000 or less, you can
                                qualify for free online tax
                                                                             The IRS received 73 million
                                                                                                                          Starting this year, taxpay-
                                                                                                                          The IRS received 73 million
                                                                                                                          ers who use direct deposit                   querading under the              (There’s no tax on income
                                                                             electronically filed tax returns in          electronically filed tax returns in          harmless-sounding moni-          of $850 or less, and the
who earn less than              preparation and e-filing
                                through the IRS’s Free
                                                                             2006, while about 61 million
                                                                             taxpayers submitted paper returns.
                                                                                                                          will be able to divide their
                                                                                                                          2006, while about 61 million
                                                                                                                          refunds submitted paper returns.
                                                                                                                          taxpayers into three sepa-
                                                                                                                                                                       ker “kiddie tax.”                next $850 in income is
                                                                                                                                                                         Beware, it may pack a          taxed at the child’s rate.)
$52,000 a year                  File alliance of tax prep
                                companies — as long as
                                                                              80 million
                                                                                                                   73
                                                                                                                          rate deposits to financial
                                                                                                                           80 million
                                                                                                                          accounts, such as checking,            73    wallop.                            For unearned income
                                                                                     Number of tax                         70 Number of tax                              Children under 18              over $1,700, the child’s tax
                                you use the IRS Web site                      70                                          savings and retirement                                                        is computed at the par-
     BY EILEEN PUTMAN
      The Associated Press
                                www.irs.gov to link to those                  60
                                                                                     returns filed                        accounts. filed
                                                                                                                           60
                                                                                                                                 returns                               with unearned income,
                                                                                                                                                                                                        ent’s tax rate. (But a child
                                offers.                                              electronically                              electronically
                                                                                                                             Those owing tax can pay                   including certain college
                                                                                                                                                                       savings funds and other          who turned 18 in 2006 or
   WASHINGTON, D.C.                Some of those companies                    50                                          electronically by charging
                                                                                                                           50
                                                                                                                                                                       investments, are likely to       on Jan. 1, 2007, isn’t sub-
— Filing taxes electroni-       may be limited to filing in                                                               it to a credit card; hav-
                                                                              40                                           40                                          owe more in taxes, thanks        ject to the kiddie tax for
cally is the quickest way to    certain states or to taxpay-                                                              ing the IRS withdraw the
                                                                                                                                                                       to a provision Congress          2006 income.)
get a refund. The Internal      ers of a certain income                       30                                          money directly from a bank
                                                                                                                           30
                                                                                  24.6                                        24.6                                     made retroactive to Janu-          Parents who sold some
Revenue Service hopes that      level. The IRS advises tax-                                                               account; or through the U.S.
                                                                              20                                           20                                          ary of 2006. That means          of the child’s investments
carrot will draw even more      payers to “carefully review                                                               Treasury’s Electronic Fed-
                                                                                                                                                                       an unexpected tax bite           early in 2006 — on the
e-filing taxpayers this year.   the free offer descrip-                       10                                          eral Tax Payment System
                                                                                                                           10
                                                                                                                                                                       for parents who assumed          assumption that because
   “E-filing is changing the    tions” before starting their                                                              by phone or over the Inter-
                                                                                0                                           0                                          they left that hurdle            the child was 14 or older
way the nation does taxes,”     returns.                                           ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06          See ’00 ’01 ’02 ’03 ’04 ’05
                                                                                                                          net.’98 ’99 http://eftps.gov’06
                                                                                                                                                                       behind when their child          the resulting capital
said IRS Commissioner              While tax prep and e-fil-                                                              for more information. (But
                                                                            SOURCE: Internal Revenue Service         AP SOURCE: Internal Revenue Service               turned 14.                       gains would be taxed at
Mark W. Everson. He said        ing of a federal return may                                                               don’t respond to e-mails AP                                                   the child’s lower rate
the agency received 73 mil-     be free, the company may                                                                  purporting to be from all                      “It’s done a lot to
                                                                                                                                      It is mandatory to include
                                                                                                                                                                       destroy a lot of planning        — will be disappointed.
lion electronically filed tax   charge for filing state or                  updated by the IRS. These                     EFTPS and asking for per-
                                                                                                                        sources that accompany this graphic when
                                                                                                                                                                       that a lot of people had         Because Congress made
returns in 2006. About 61       local income taxes. It also                 can be downloaded from                        sonal information; that’s
                                                                                                                        repurposing or editing it for publication. a
                                                                                                                                                                       done to fund education,”         the kiddie tax change
million taxpayers submit-       may sell other services or                                                                known scam.)
                                                                            the programs’ Web sites Chart shows number of tax returns filed
                                                                            <AP> TAX E FILING 013007:                                                                  said Donna LeValley, a           retroactive to Jan. 1, 2006,
ted paper returns in 2006.      products, which the IRS                                                                      E-filing taxpayers create
                                                                            during filing season.1c x 3 1/8 inches; 96.3 mm x 79 mm; with BC-
                                                                            electronically since 1998;
                                                                                                                                                                       tax attorney and contrib-        those gains are taxed
   More than 20 million         notes that consumers are                       Such programs use an
                                                                            SPE-Taxes-E-Filing; GC; ETA 6 p.m. <AP>       a personal identification
                                                                                                                                                                       uting editor of the J.K.         at the parents’ rate if
returns were filed from         under no obligation to pur-                 interview process to walk                     number, which serves as
                                                                                                                                                                       Lasser tax publications.         unearned income exceeds
home computers, an              chase.                                      taxpayers through the                         their electronic signature
                                                                                                                                                                         Before, only children          $1,700.
increase of about 19 per-          There’s a new, consumer-                 return preparation. Before-                   and requires knowing their
                                                                                                                                                                       under 14 with investment           You can choose to
cent over the previous year.    friendly wrinkle to Free                    hand, gather your records:                    2005 adjusted gross income.
                                                                                                                                                                       income were subject to           include the child’s
   Refunds for e-filed tax      File this year. Companies in                your 2005 tax return; 2006                    Taxpayers who don’t cre-
                                                                                                                                                                       the “kiddie tax” — the           income on your tax
returns come in about two       the Free File Alliance have                 income records such as W-2 ate a PIN can still file
                                                                                                                                                                       nickname for the part of         return, provided the
weeks if the IRS deposits       agreed not to offer Refund                  statements from employers                     electronically but will also
                                                                                                                                                                       the child’s tax that must        child’s income is less
the refund directly into the    Anticipation Loans, which                   and end-of-year interest                      have to mail Form 8453-OL
                                                                                                                                                                       be figured at the parent’s       than $8,500 and consists
taxpayer’s bank account.        provide taxpayers quick                     and dividend statements,                      to the appropriate IRS ser-
                                                                                                                                                                       top rate instead of the          only of interest and
That’s compared with eight      cash against their expected                 as well as any 2006 tax                       vice center after they have
                                                                                                                                                                       child’s rate, which is           dividends or capital gains
weeks for taxpayers who         refunds, usually for high                   refunds; and payments                         received IRS confirmation
                                                                                                                                                                       usually lower. Now, the          distributions on those
file a paper return and opt     fees.                                       such as state and local                       that the e-filed return was
                                                                                                                                                                       kiddie tax is extended to        investments. Reporting
for a paper refund check.          “We heard many legiti-                   taxes, business expenses,                     accepted.
                                                                                                                                                                       children under 18.               the child’s investment
   Besides producing faster     mate concerns about the                     mortgage interest and any                        During transmission, the
                                                                                                                                                                         “Parents may think             income on your return
refunds, filing electronical-   marketing of ancillary                      other deductible expenses.                    tax return is sent from a
                                                                                                                                                                       their children have out-         may reduce paperwork
ly reduces errors because       products during the last                       Taxpayers also can take                    modem or other Internet
                                                                                                                                                                       grown this provision,”           and costs — since the
tax preparation software        filing season,” Everson,                    their records to a profes-                    connection to an electronic
                                                                                                                                                                       said Bob Scharin, senior         child doesn’t file a return,
rejects returns with data       of the IRS, said in a state-                sional preparer, who can                      return transmitter, which
                                                                                                                                                                       tax analyst from Thom-           tax preparation expenses
entry mistakes or inconsis-     ment. “This is a construc-                  also file the tax return elec- converts the file to a format
                                                                                                                                                                       son Tax & Accounting             may be reduced.
tencies. The most common        tive step.”                                 tronically. It’s a more costly that meets IRS specifica-
                                                                                                                                                                       who advises tax profes-            But including a child’s
problems — an incorrect            Another way to e-file is                 route, though it may be                       tions and forwards it to the
                                                                                                                                                                       sionals. “That could be a        income on your return
adjusted gross income fig-      by using home tax software                  worth it if your taxes are                    IRS for processing. Within
                                                                                                                                                                       big surprise to someone          also adds to your adjusted
ure or Social Security num-     such as TurboTax or Tax-                    complicated. Tax prepara-                     48 hours the IRS confirms
                                                                                                                                                                       with a 16- or 17-year-old.”      gross income, which in
ber, or carrying over the       Cut. The programs can be                    tion bills from H&R Block,                    whether the return has
                                                                                                                                                                         Shifting income to chil-       turn may subject you
wrong amount from the tax       bought online or in office                  for example, average about                    been accepted or rejected.
                                                                                                                                                                       dren in lower tax brack-         to phase-out or reduc-
table — are often careless      supply stores and usually                   $160 per client, according to                                    
                                                                                                                                                                       ets is a strategy long used      tion of certain exemp-
errors that are easy for tax-   include rebates and cou-                    the company.                                     On the Net:
                                                                                                                                                                       by the wealthy to reduce         tions, deductions, IRA
payers to fix once the tax      pons for free e-filing of at                   The IRS can find an e-                        IRS: www.irs.gov
                                                                                                                                                                       their tax, and Congress          contributions and other
program highlights them.        least one tax return. The                   filing tax pro for you if                        Electronic Federal Tax
                                                                                                                                                                       took aim at that practice        tax breaks, as well as
   In many cases, state and     companies — Intuit in the                   you enter your ZIP code in                    Payment System: http://
                                                                                                                                                                       when it passed the kiddie        increase your state and
local tax returns can be        case of TurboTax and H&R                    the e-file locator box on //                  eftps.gov
                                                                                                                                                                       tax nearly 20 years ago.         local tax liability.
e-filed at the same time as     Block in the case of TaxCut                 www.irs.gov.                                     TurboTax:
                                                                                                                                                                         But the wealth-shifting          Whichever tax-filing
federal returns.                — update tax forms and                         Taxpayers due a refund                     www.turbotax.com
                                                                                                                                                                       strategy was also a way          strategy you choose,
   There are several routes     instructions as they are                    must provide bank account                        TaxCut: www.taxcut.com
                                                                                                                                                                       for middle-income par-           be sure to file the cor-
                                                                                                                                                                       ents to save for children’s      rect forms: Form 8814 is
                                                                                                                                                                                                        attached to the parent’s
                                                                 B P                                                                                           college expenses.
                                                                                                                                                                         Nowadays, many par-            return when a child’s
                                                                                                                                                                       ents choose as college           investment income is


Audit chances pretty good if you’re rich                                                                                                                               savings vehicles the             reported with the par-
                                                                                                                                                                       popular 529 plans, which         ent’s income. When the
                                                                                                                                                                       allow earnings to grow           income is reported on
                                                                                                                                                                       tax-free when the money          a child’s separate tax
                                                                                                                                                                       is used for higher educa-        return, Form 8615 is filed
Overall, audits of                                                                Not every audit means a                of limitations, during
                                                                                                                                                                       tion. But 529s weren’t as        with the child’s return

individuals up 6%                Tax audits up                              Tax audits up
                                                                              “field” audit, a face-to-face
                                                                              meeting with an IRS agent.
                                                                                                                         which the IRS can go back
                                                                                                                         and make additional tax
                                                                                                                                                                       widely available when
                                                                                                                                                                       parents of today’s older
                                                                                                                                                                                                        and no additional form
                                                                                                                                                                                                        is filed with the parent’s
                                 Overall, audits of individual                Some are correspondence
                                                                              Overall, audits of individual              assessments. But that time                                                     return.
                                                                                                                                                                       teens started saving.
                                 taxpayers were up 6 percent                  taxpayers essentially a let-
                                                                              audits —were up 6 percent                  can be extended if the IRS
     BY EILEEN PUTMAN                                                                                                                                                  Instead, those parents
                                 in 2006.                                     ter from the IRS to clear
                                                                              in 2006.                                   suspects serious underre-
      The Associated Press                                                                                                                                             typically saved for college
                                 Income of $99,999 and lower                  up discrepancies or appar-
                                                                              Income of $99,999 and lower                porting of income. There
                                                                                                                                                                       by putting money into
  WASHINGTON, D.C.                                                            ent inaccuracies.                          is no statute of limitations
                                       0.85% of returns audited                     0.85% of returns audited                                                           custodial mutual funds,
— Your chances of being                                                           More serious tax issues                for failure to file a return
                                                                                                                                                                       bonds or other savings
audited are pretty good if       $100,000 and higher                          $100,000 and higher
                                                                              involve underreporting                     or when tax fraud is sus-
                                                                                                                                                                       instruments in the child’s
you’re wealthy. They’re not                 1.57%                             income and overstating
                                                                                         1.57%                           pected.
                                                                                                                                                                       name.
bad if you’re not.                                                            deductions, exemptions                       If the case reaches actu-
                                 $1 million and higher                        $1 million and higher                                                                      It’s the return on
  About 1 in 16 taxpayers                                                     and credits. For that rea-                 al prosecution, there is
                                                                    6.1%                                        6.1%                                                   those investments — the
with income of $1 million                                                     son, a tax return with a                   this sobering fact: The IRS
                                                                                                                                                                       “unearned” income
and higher was audited           Number of tax audits                         large number of deduc-
                                                                              Number of tax audits                       reports it had a conviction
                                                                                                                                                                       that includes interest,
last year, a 33 percent                                                       tions may be flagged for                   rate last year of 91.5 per-
                                        Income $99,999 and lower                     Income $99,999 and lower                                                          dividends, rents, royalties
increase from the previous                                                    audit.                                     cent.
                                        $100,000 and higher                          $100,000 and higher                                                               and profits on the sale
year.                                                                             Celebrities have also                              
                                        $1 million and higher                        $1 million and higher                                                             of property — that falls
  “If you’re earning that                                                     been known to attract the                    On the Net:                                 under the kiddie tax. The
kind of money and we             1.4 million                                  1.4 million
                                                                              IRS’ attention: Late last                    IRS Tax Advocate Ser-                                                          �����������������������
                                                                                                                                                                       tax doesn’t apply to wages
notice a problem, you’re                                   1.04 million       year, actor Wesley Snipes 1.04 million     vice: www.irs.gov/advocate,
                                 1.2                                          1.2                                                                                      a child earns at a job.            ����������
going to hear from us,”                                                       pleaded innocent to federal                phone: 1-877-777-4778
                                   1                                            1                                                                                        Here’s how the kid-
IRS Commissioner Mark                                                         charges that he failed to
W. Everson said in a state-      0.8                                          file
                                                                              0.8 tax returns and that he                                                                                                 ���������������������
ment on the agency’s                                                          falsely claimed millions of                                                                                                 ���������������������������
                                 0.6                                          0.6
enforcement figures for                                                       dollars in refunds.                                                                                                         ������������������������
the 2006 fiscal year.            0.4                                 0.26     0.4 Taxpayers have the 0.26        right
                                                                                                                                                                                                          ����������������������������
  But it’s not just those in                                                  to appeal IRS findings
the financial stratosphere
who face increased IRS
                                 0.2

                                   0
                                                                     0.02
                                                                              0.2
                                                                              and, if the dispute can’t be
                                                                              settled, to take their case
                                                                                0
                                                                                                                 0.02         ���������� ��� �� ���������                                                 ���������������������������
                                                                                                                                                                                                          ��������������������������
scrutiny.
  Audits of taxpayers with
                                       1998 ’00
                                 * Preliminary figures
                                                       ’02     ’04 ’06*             1998 ’00        ’02
                                                                              to the Taxpayer Advocate
                                                                              * Preliminary figures
                                                                              Service, which is part of
                                                                                                            ’04 ’06*
                                                                                                                              ��� ��� �������� �������� ���                                               ������������������������

                                                                                                                              ����������������� ������
                                 NOTE: Figures unavailable for income         NOTE: Figures unavailable for income
                                                                                                                                                                                                          ��������������������������
incomes above $100,000           of $1 million and higher for 1997-2003.
                                                                              the IRS but operates inde-
                                                                              of $1 million and higher for 1997-2003.                                                                                     ���������������������������
were up 18 percent from                                                       pendently and will help
2005, the highest figure in     SOURCE: Internal Revenue Service              taxpayers resolve prob- AP
                                                                         AP SOURCE: Internal Revenue Service
                                                                                                                                                                                                          �����������������������������
more than a decade. Audits                                                    lems.                                           �������������������������������������������������������������               ��������������������������
of certain businesses,          vidual taxpayers were up <AP>The IRS can also work TAX AUDITS 013007: Graphic                 ���� ������������� ��� ����� ���� ��� ��� ����������� ������������          ��������������������������
especially “S” corpora-         by 6 percent in 2006; total shows the number of tax audits by
                                                                              out payment plans for
                                                                                                                              ����������������������������������������������������������                  ����������������������������
tions and partnerships,                                                       those year; owe inches; 47
                                individual returns audited salary and who 1c x 5unpaid mm                                                                                                                 ��������������
increased by 34 percent,        were 1.3      Itmillion, for an
                                                is mandatory to include    x 127 mm; with BC-SPE--Taxes-Audits;
                                                                              taxes, interest or penalties.                   ���������������� �� ���������
                                                                          JB; ETA 6 p.m. <AP>
though audits of larger         all sources that accompany this graphic
corporations — with assets      when repurposing or editing it for
                                publication.
                                                                                                                              �����������������������������������������������������������
over $10 million — were
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down slightly.                  average individual audit                      Congress set three years
  Overall, audits of indi-      risk of about 1 in 100.                     as the deadline, or statute
E6           The Register-Mail, Galesburg, Ill.        Sunday, Feb. 4, 2007

                                                                                                                        MONEY & TAXES
Debt                                                                                                                                             B M
From Page E1

the Fair Credit Reporting
Act. You may find debt on
                                           Short-term refund loans carry hefty price
                                                 BY EILEEN PUTMAN
there that you never even                                                                                                                               to the company’s Web site.                 NCLC in Boston. Neverthe-      panies that provide free tax
knew you had — or at
least old credit cards that
                                                 The Associated Press
                                                                                                        Fast loan, high price                   Fast loan, high price
                                                                                                                                                           Fees are withheld from
                                                                                                                                                        the loan proceeds, which
                                                                                                                                                                                                   less, RALs still present “huge
                                                                                                                                                                                                   public policy concerns”
                                                                                                                                                                                                                                  preparation and electronic fil-
                                                                                                                                                                                                                                  ing for taxpayers with adjust-
need closing.                                 WASHINGTON, D.C.                                          Millions of Americans choose to                   Millions of Americans choose to
                                                                                                                                                        can be loaded onto a prepaid               because they drain money       ed gross incomes of $52,000
                                           — There are loans for just                                   take out refund anticipation loans                take out refund anticipation loans
   Meanwhile, also look at                                                                              (RAL), short-term loans against
                                                                                                                                                        “ipower CashCard.” Fees
                                                                                                                                                          (RAL), short-term loans against          from the working poor, she     or less. Under the agreement,
the interest rates on your                 about everything these days,                                                                                 can include a $30 bank load                said.                          the companies will no longer
                                           so why not loans against your                                the expected value of their tax                   the expected value of their tax
secured debt — home,                                                                                    refund. The convenience costs                   fee, a $20 “Jackson Hewitt
                                                                                                                                                          refund. The convenience costs              Data collected by the IRS    offer RALs to taxpayers who
auto, fishing boat, RV    .                tax refund?                                                                                                  Office Fee,” as well as various show that in the 2004 filing              use that program.
                                                                                                        taxpayers billions.                               taxpayers billions.
Have the rates gone down                      Bad idea, say tax experts.                                                                                other fees associated with                 season, 56 percent of the        The Taxpayer Advocate,
since you first took out                   Such loans provide quick                                     Approximate number of RALs                        Approximate
                                                                                                                                                        themillions the number of RALs
                                                                                                                                                          In
                                                                                                                                                               use of      CashCard,               13.8 million RAL recipients    an independent office within
the loan? If so, consider                  cash at a hefty price.                                       In millions
                                                                                                                                                        including a $15 “card closure/ — about 7.7 million — were                 the IRS that helps taxpayers
refinancing.                                  An estimated 12 million                                             12.1    12.7 12.2 12.4                           12.1 12.7 12.2
                                                                                                                                                        cancellation” fee. 12.4                    also recipients of the Earned  resolve tax problems, wants
                                           taxpayers took out refund                                       10.8                                            10.8
   Clearly this is the point                                                                                                                  9.6          The company did not 9.6                 Income Tax Credit, the fed-    Congress and the agency to
where you need to set up a                 anticipation loans — or RALs                                                                                 respond to a reporter’s                    eral poverty assistance pro-   do more to stop abusive loans
budget and start tracking                  — in 2004, the latest year for                                                                               repeated requests to make a                gram for working families.     — including reducing the
your day-to-day spending                   which there are comprehen-                                                                                   spokesman available to dis-                  Eligible taxpayers typi-     time it takes to get refunds
habits. And there is help                  sive figures, according to                                       ’00    ’01 ’02 ’03         ’04    ’05            ’00    ’01 ’02 ’03
                                                                                                                                                        cuss its RALs.
                                                                                                                                                                                     ’04    ’05
                                                                                                                                                                                                   cally need help in preparing and issuing refunds on U.S.
out there for you to do                    the National Consumer Law                                    Approximate RAL loan fees                          Critics of RALs, like fees
                                                                                                                                                          Approximate RAL loan the                 the complex paperwork to       debit cards that don’t carry
this.                                      Center. These mostly low- and                                In billions                                     National Consumer Law Cen- claim the credit. That can
                                                                                                                                                          In billions                                                             high transaction or process-
   You can use software                    moderate-income taxpayers                                                             1.14      1.09
                                                                                                                                                        ter, $0.81 0.91
                                                                                                                                                                              1.14
                                                                                                                                                              say they amount to loan-
                                                                                                                                                                                         1.09
                                                                                                                                                                                                   leave them vulnerable to       ing fees.
                                                                                                             $0.81 0.91
programs, like Quicken                     paid a total of more than $1                                                                                 sharking — easy cash at usu-               unscrupulous tax prepar-         In part to dampen RAL
and Microsoft Money.                       billion in fees for their easy                                                                               rious rates.’01  Though the vol-           ers, even as they urgently     demand, the IRS this year
Or you can go to con-                      money   .                                                           ’00        ’01     ’02       ’03                 ’00            ’02
                                                                                                                                                        ume of RALs appears to be
                                                                                                                                                                                          ’03
                                                                                                                                                                                                   need cash to pay bills, unex- will deposit a taxpayer’s
sumer-oriented Web sites,                     RALs are a short-term cash                               SOURCES: National Consumer                 AP    leveling off — Consumer says it
                                                                                                                                                         SOURCES: National the IRS              AP pected expenses and tax        refund directly into as many
like CNN Money (http:                      advance using the expected                                  Law Center; Consumer                              Law Center; Consumer
                                                                                                                                                                       9.6 million returns
                                                                                                                                                        processedAmerica                           prep fees.                     as three financial accounts,
//money.cnn.com), or                       tax refund as collateral. Tax-                              Federation of America                             Federation of
                                                                                                                                                        with RAL indicators in 2006,                 The IRS does not endorse     such as checking, savings and
www.smartmoney.com                         payers get the money before                                                                                  down slightly from previous                RALs and notes that with       retirement.
                                           the Internal Revenue Service                                include a tax preparation fee,                <AP> TAX REFUND LOANS
and www.myspending-                                                                                                                                     years — opponents say such
                                                                                                                                                     013007: Graphic shows how many                electronic filing of tax         Still, many taxpayers who
plan.com. All have budget-                 sends a refund; they sign over                              now averaging $160. Rauber                       loans are still a problem
                                                                                                                                                     refund anticipation loans were for            returns, taxpayers receive     purchase RALs don’t have
ing programs into which                    the actual refund to the lend-                              said the lender, HBSC, “will                     lower-income taxpayers.                    refunds in two weeks or less   a bank account in which to
                                                                                                                                                     taken out in recent years; 1c x 3
you can plug your infor-                   er. The typical loan period is 7                                          It is mandatory to through
                                                                                                       only provide an RAL include                         “We’re seeing trends in
                                                                                                                                                     5/8 inches; 46.5 mm x 92 mm; withthe          — though it can take six to    deposit a refund check or
mation.                                    to 14 days.                                                 a
                                                                                                       alllicensed accompany this graphic
                                                                                                          sources that tax professional,”
                                                                                                                                                        right direction from at least
                                                                                                                                                     BC-SPE-Taxes-Refund Loans;                    eight weeks for those filing   can’t wait the time it would
                                                                                                       when repurposing or editing it for
   If, after all this, your                   Many companies offer                                     meaning that “to obtain an
                                                                                                       publication.                                     some of p.m. </AP>
                                                                                                                                                     MMS; ETA 1 the industry actors,               paper returns.                 take to get an IRS check, Tax-
bills are still higher than                RALs, though they aren’t                                    RAL from H&R Block, a cli-                       whether due from lawsuits                    Last fall, the IRS reached   payer Advocate Nina E. Olson
your income, consider                      always called that — look                                   ent must have their taxes                        or public attention,” said Chi             an agreement with an alli-     noted in her 2006 report to
entering a debt manage-                    for phrases like “fast cash                                 prepared by us.”                                 Chi Wu, staff attorney at the              ance of tax software com-      Congress.
ment plan. This is a for-                  refunds,” “express money”                                       Rauber says Block makes
mal program in which                       or “instant refunds.” Most                                  sure clients understand that
an agency will gather                      carry a multitude of fees,                                  an RAL is a loan and disclos-                       ��������� �             �          ��������� �            �      ���������� �       �       �����
up your unsecured debts                    sometimes hidden or not                                     es all fees ahead of time.

                                                                                                                                                         ���� ������
(credit cards, tuitions,                   immediately obvious to the                                      “We’ve reached out to
personal loans) and nego-                  consumer.                                                   consumer advocate groups.
                                              In a 2006 report to Con-                                 We’ve enhanced our disclo-
                                                                                                                                                 ��� �������� � �����������
tiate a repayment pro-
gram on your behalf.                       gress, the IRS’ Taxpayer                                    sures,” she said.
   In return, you write one                Advocate Office cited as typi-                                  She cites Block’s RAL fact
                                           cal a $3,000 RAL facilitated                                sheet to clients, which states
check to the agency, which
disperses the money                        by tax-prep giant H&R Block                                 they must repay the full                           �� ��� ���� �������� ����                                                            ������������������
                                                                                                                                                                                                                                                       ����
                                                                                                       amount of the loan “even if
                                                                                                                                                                ��� �������
among your creditors.                      through lender HSBC Bank.
   You might have to agree                 The loan carried a $24.95                                   the IRS does not send all of
to not apply for new credit                bank account setup fee and a                                your refund.” The brochure
                                           $75 finance charge — on top                                 notes that taxpayers whose
                                                                                                                                                        ��������������������
while the repayment pro-
gram (often as much as 48                  of an average $150 tax return                               RAL applications aren’t
months) is going on. On                    preparation fee.                                            accepted by the lender-bank
                                              Last year Block settled a                                still must pay an account fee
the other hand, you’ll no
                                           number of class-action law-                                 and adds: “The total cost of                                    ����������������������������
longer be getting the eve-                                                                                                                                                                                                                       ������������������
ning calls from debt col-                  suits over its RALs.                                        an RAL may be substantially                                                               �������������                                    �������������
lection agencies and some                     The company has since                                    higher than other kinds of                                         ���������������������������������������������
sanity will be restored to                 lowered fees by 40 percent                                  credit, and you may want to
                                                                                                       consider other alternatives.”                                                           �������������������
your life.                                 for its average RAL of
   The federal U.S.                        $2,800, said spokeswoman                                        Jackson Hewitt Tax Ser-                                               ���������������������������������
Trustee Program has a                      Kate O’Neill Rauber. Such a                                 vice, the nation’s second-larg-
list of approved debt-                     loan could cost as low as $60
                                           when combined with a bank
                                                                                                       est tax preparer with over
                                                                                                       6,000 franchise sites, offers
                                                                                                                                                                            ������������
management agencies
at its Web site, http:                     account and Block’s “Emer-                                  RALs of up to $9,999 through                                                                                                             �����������������
//www.usdoj.gov/ust/eo/                    ald Prepaid Card.”                                          a bank lender that can be had                                ��� ����������������                     ��� ��������������                        ����
bapcpa/ccde/index.htm.                        But that charge doesn’t                                                              ,
                                                                                                       in as little as a day according
It also has loads of great
information on credit
counseling and debtor
education. (This is where
you go, as a last resort,
to find out about bank-
ruptcy.)
   One more source of
general information on
getting your debt under
control is the Federal
Trade Commission. Go to
www.ftc.gov and look for
the “consumer” link.
   Just remember, the first
step is acknowledging
that your financial situ-
ation is destroying your
quality of life. The second
is to do something about
it.

       ��������������������������
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