New Info Blog

Money is what “makes the world go round.” And one of the most difficult propositions in life is to manage money.

While some are born with great financial acumen others need to be methodical and follow sound advice.

Here are a few basic tips:

1. Inculcate frugality within you; desist temptation to spend now save later. Every dollar earned must be divided into four parts: one part to meet essential expenses; one part to be invested in short-term savings; one part for retirement savings; and one part for emergency expenses.

2. Create with expert advice an infallible financial plan. Plan your credit report, taxes, and expenses. Keep a watch and learn how to regulate yourself.

3. Avoid the debt trap set by credit card companies and the easy availability of loans. Only spend what you have in hand and not any monies in advance.

4. Learn the art of investment. The World Wide Web is a reliable resource for information, reviews, and guidelines on investments. If doubtful seek expert advice on investments; the ideal is to balance investments into sure-fire investments, medium risk investments, and high risk investments.

5. Make wise decisions when buying a home, office, and more. Avail a mortgage that works for you. Property can be a good investment when bought after deep thought and in allocation where the appreciation is high.

6. Teach every family member how to invest and the secret of handling money wisely. Even children need to learn from a young age.

7. Insure your interests. Take enough insurance but learn the art of saving on premiums, clubbing policies, and umbrella policies. Know how to save money every step.

8. Spend prudently. Plan your luxuries and eating out. Learn how to shop sensibly and not indulge.

9. Avoid lending money or borrowing money. Financial matters are best handled alone and not through family or friends.

10. Review your financial plan regularly and make the necessary adjustments. As a family grows needs change. Begin saving for college and education from the early years. Teach the children never to take you for granted. Discuss things with your family members.

Use expert advice when needed so that you are always protected financially. Read websites such as that hosted by the Federal Trade Commission to protect America’s consumers: http://www.ftc.gov

The World Wide Web is a knowledge highway and brings financial advice to the finger tips. Keep abreast of money management, taxation, insurance, and property laws. Plan for retirement and be secure in the future.

Matthew Pawlina is a writer for Financial Advisors, the premier website to find, advisor financial rated, advisor become financial, advisor as career financial, advisor financial new, advisor complete financial, advisor financial service, advisor financial training, and many more.

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“The main reason people struggle financially is because they have spent years in school but learned nothing about money. The result is that people learn to work for money. . . but never learn to have money work for them.” Robert Kiyosaki

The #1 New York Times Bestseller “Rich Dad, Poor Dad” is a story about the money lessons that Robert Kiyosaki learned from his two dads, his biological father, who was his poor dad, and his best friend’s father, who was his rich dad. Poor dad was a Ph.D. and held a very important government position, but he never had enough money at the end of the month and he died broke. Rich dad dropped out of school at the age of 13 and went on to become one of the wealthiest men in Hawaii.

“Rich Dad, Poor Dad” is a must-read for anyone looking to develop a rich person’s financial programming and mindset. The first important lesson this book teaches is the following: Don’t work hard for money; instead, have money work hard for you.

Kiyosaki explains in his book that there are three types of income:

• Earned income

• Passive income

• Portfolio income

Poor dad taught his son Robert to go to school, study hard, and get good grades so that he could find a secure job that would pay him a good salary and give him excellent benefits. That is, he advised him to work for earned income, or to work for money. However, there are several problems with this strategy. First, income streams from a salary are linear: you only get paid once for your effort. If you stop showing up for work, you stop getting a paycheck. It’s like being on a treadmill. Second, earned income is confined to the amount of time that you work, and time is a limited resource. Therefore, there’s a limit to how much earned income you can make. And third, earned income pays the most taxes.

Passive income is income that does not require your direct involvement. You make a strong initial effort to get this type of income started, but then you do minimal work thereafter to keep it going. It can be income derived from royalties–for example, you write a book–, income derived from patents–you invent something–, income derived from real estate, and so on. Brian Lee at geniustypes.com swears by bulk candy vending machines to create passive income. There are many ways to create passive income and the key is to be on the look-out for passive income producing opportunities.

Portfolio income is generally derived from paper assets such as stocks, bonds and mutual funds. Bill Gates is one of the four richest men in the world because of portfolio income, not earned income. That is, he’s rich because of the stock that he owns, not because of the salary he earns. One of the many benefits of portfolio income is that paper assets are easier to maintain than other types of assets.

Another way to think of passive and portfolio income is as residual income.
With residual income you work hard once, and it unleashes a steady flow of income for months or even years. You get paid over and over again for the same effort. That is, you get paid multiple times for every hour of work and the stream of income continues to flow whether you’re there or not. Therefore, you can spend your time doing things other than working for money. In addition, how much money you make is not determined by how many hours you work, but by how many residual streams of income you create.

Rich dad would say to Robert: “The key to becoming wealthy is the ability to convert earned income into passive income and/or portfolio income as quickly as possible.” Start looking for opportunities to create passive and portfolio income and develop a disciplined, well-planned strategy for your money.

Written by Marelisa Fábrega who blogs at http://abundance-blog.marelisa-online.com

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OK. You’re sitting in the privacy of your own home. You’re surfing the net. You’re getting the skinny on Brad and Angelina and all the really important things in life. Suddenly, you notice the ad with the guy dancing a jig, and the ad saying you can get a home loan of $150,000 for less than $600 a month.

That sounds good to you, so you take the bait. You go to their on-line mortgage calculator, plug in some numbers and find out that you could re-finance for a lot less than what you are paying now. But notice the little asterisk (*) on the page. It discloses that the payment given by the calculator does not include all possible fees. And these “possible” fees are more than possible, they are probable.

The payment you get from the on-line mortgage payment calculator gives you a principal and interest payment. What else is there to a loan payment? I’m glad you asked. Principal and interest is the lion’s share of what you pay each month, but today’s loans are structured to insure that your annual real estate taxes and your home owner’s insurance are paid.

The way the lender insures that taxes and insurance are paid is called “escrowing”. In simplest terms, that means the lender collects a little bit from you every month and sets it aside. Then, by the time your annual taxes and insurance premiums are due, there is enough built up to pay them. If the lender expects your taxes to be $1200, they will collect about $100 every month. If your insurance is $600 a year, the lender will collect about $50 per month. So tax and insurance escrow totals $150 a month. Add that onto the payment you got from the on-line mortgage payment calculator. But we’re still not finished with the add-ons.

There is usually a third amount added onto a mortgage payment-P.M.I. (private mortgage insurance). P.M.I. is an insurance premium that you pay for your lender. It insures them that they will get paid if you, for whatever reason, default (stop paying) on your loan.

If you’re buying, unless you can come up with a minimum of 20% down, you will pay P.M.I. If you’re refinancing, you must have at least 20% equity in your home in order to avoid paying P.M.I. A good estimate for your P.M.I. premiums is about $100 per month. Including escrow payments, we see that we must add a total of $250 onto the payment reflected by the on-linemortgage payment calculator.

Now, you have a more accurate estimate of your total monthly mortgage payment.

Learn from Lyn Collier’s years of Real Estate experience.

Read simple, to-the-point articles about avoiding costly mistakes and What a mortgage calculator does not tell you at one of the best mortgage information sites on the web – http://www.e-home-mortgage-loans.com/index.html

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Beginning or expanding a business can be an exciting venture. But to do so successfully, a business owner is going to need capital. That comes from either the owner’s personal check book or financing extended through a bank. To secure financing through a bank, a business owner must understand the 5 C’s of Credit. These guidelines are used by financial institutions as a way of analyzing a borrower’s request for a loan. The 5 C’s: Cash Flow, Collateral, Capital, Character and Conditions are the major elements a bank uses to examine a business and its owner during the loan process. Each can have an impact on a funding request.

Cash Flow
A business owner may feel he or she needs additional capital to run a business, but they must also demonstrate the ability to repay the loan being considered. In determining this, a bank will analyze the company’s projected and historical cash flow in comparison to its debt. A commonly used method, the “EBITDA” ratio looks at a business’ Earnings Before Interest, Taxes, Depreciation and Amortization. Broadly speaking, it’s the measure of the cash flow generated by a business. This is the cash flow available to repay the debt once the company has met its other payments required to sustain the business.

A bank may also be interested in how much capital has been invested by the owner, which requires calculated risk. Financial statements and personal credit assist bankers in knowing how much an owner’s personal resources can support the business as it is growing. For companies that have yet to make a profit, elements such as an excellent customer list and payment history also come in to play. Bottom line: the business should be perceived by a bank as solid.

Collateral
Bankers also look at collateral, or the secondary source of repayment. Collateral are assets offered by a company as an alternate repayment source. Typically these assets include real estate, accounts receivable, inventory, and equipment. In a liquidation scenario, accounts receivable can be used to pay down a loan, while equipment and real estate can be sold to generate income to pay down the loan as well. Until a business is established, a business owner will need to pledge collateral that may be linked to personal assets, such as a house. No one wants to be in the position of losing a home because a loan has turned sour. A business owner needs to think carefully about how he or she will handle the collateral element when borrowing money from a financial institution.

Capital
Banks essentially are looking for sufficient equity in the company on the part of an owner. Sufficient equity can aide a business when times are soft. It’s important a company be able to sustain itself during tough times. Additionally, banks want assurance that an owner is truly invested in the company and will do what it takes to turn things around if cash flow becomes a problem. When examining capital, banks typically analyze the company’s total liabilities compared to equity, or the Debt to Equity Ratio. Most banks like to see the Debt to Equity Ratio no higher than 2 to 3 times.

Character
It’s not hard to understand why investors want to invest with those who possess impeccable references and credentials. This is where the character of the loan applicant comes in to play. While the character card can be challenging to assess, a bank will carefully review business and personal credit reports, as well as communicate with vendors regarding a business owner’s dealings with them. Owners need to demonstrate that they are indeed effective leaders and can conduct themselves professionally in challenging times. Securing a business loan from a bank is based on trust, to a large extent. Banks need to know that a business owner will act in good faith at all times to honor any and commitments.

Conditions
Bankers must always take a look at current economic conditions surrounding a business as well as issues surrounding its industry to determine key risk factors. It’s important, therefore, for the owner to make evident the ability to manage these risks to ensure the future viability of the business. Banks will examine the competitive landscape of the company, customer and supplier relationships, and other industry factors that may impede the company’s growth. Business owners should be prepared to describe the primary threats to the business and what measures are being taken to protect the company from these risks.

The 5 C’s of Credit form the back bone to a bank’s analysis when considering a request for a loan. A clear understanding of a bank’s requirements should help a loan applicant be prepared to provide appropriate information and successfully position the company in a way that results in the approval of a loan for the future growth of the business.

American Momentum Bank is a progressive, Florida based bank that strives to offer a deep understanding of our commercial, retail and online banking clients’ immediate and long-range goals, unparalleled personal service, and solutions tailored to our Clients’ specific needs. Experienced, professional management and Associates, combined with flexible decision making, is essential to the success of our Clients. Our banks’ success is a result of our Clients’ and Associates’ success. For more information, please visit http://www.americanmomentumbank.com

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You should if you want to take full advantage of a tax deduction many people overlook. The home office deduction allows individuals to deduct expenses that are not otherwise deductible such as utilities and homeowners insurance. There are certain requirements you must meet to have a home office, including:

You own a business (if you are an employee, you must meet the “for the convenience of the employer” test). You have an area set aside in your home used regularly and exclusively for specific administrative or management activities There is no other place of business where you conduct those activities

These requirements help you to determine whether the area used in your home is your principle place of business for certain business functions.

If you don’t think the area you use qualifies, you may just need to change the facts. Are there too many nonbusiness items in your office area? Move them to another room and you may qualify. Are you struggling to find business activities that you can do at home? Bookkeeping, billing and ordering supplies are just a few activities that are easily done from home.

Once you’ve determined that you have a home office and you would like to take the home office deduction, you need to track certain expenses.

Allowable home office expenses include:

- Utilities

- Mortgage interest

- Property taxes

- Homeowners and liability insurance

- Repairs and maintenance of office area

- Depreciation of office area

Deductions that do not qualify as home office expenses are items that do not relate to the home office such as landscaping and pool care. In addition, taxpayers are denied a deduction on a first phone line regardless of the level of business use. A taxpayer must have a second phone line to deduct telephone expenses, long distance charges and internet service.

Of course you can’t deduct 100% of these expenses. The expenses are allocated based on square footage or number of rooms in the house. In most cases, the number of rooms allocation yields a higher deduction, make sure your CPA calculates both numbers to maximize your deductions.

- What You Should Know About Home Office Deductions -

Home office deductions are allowed for areas used exclusively for the management and administrative duties of the business when these functions are not conducted in the principal place of business.

Prior to 1999, the IRS regarded the location of major business transactions, based on time usage, as the principal place of business. For example, sales conducted in customer’s homes disallowed the home office deduction, even if invoicing, bookkeeping and other management functions were conducted from the home. Now these responsibilities are accepted for home offices.

However, if multiple businesses are conducted from the home, separate office space should be allocated, or the entire deduction taken, in the most active business. This is particularly important where spouses each conduct business from the same home office space.

Home Office Requirements:

The home office must be an area in the home set aside and used regularly and exclusively as an office. No other fixed place of business can be used to conduct the same business regularly.
General expenses of your home are deductible in proportion to the business office percentage of your home. This can be measured either by square footage or by number of rooms, excluding bathrooms and hallways.

Certain home office expenses must be paid through your company, while others are personal expenses.

The following items should not be paid by your company:

- Mortgage expense and interest.

- Property taxes.

- Homeowners and liability insurance.

- Repairs and maintenance of the office space.

The following items should be paid through your company:

- furniture and fixtures purchased specifically for business purposes, whether stored in the home office or at another location.

- Separate business phone lines that are installed at the home office.

- Office supplies.

- Other items specifically used for the business.

The following items are not generally deductible:

- Landscaping and lawn maintenance.

- Pool care.

Tom Wheelwright is not only the founder and CEO of Provision, but he is the creative force behind Provision Wealth Strategists. In addition to his management responsibilities, Tom likes to coach clients on wealth, business, and tax strategies. Along with his frequent seminars on such strategies, Tom is an adjunct professor in the Masters of Tax program at Arizona State University. For more information, please visit http://www.provisionwealth.com

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Some of the safest investments are bonds. A bond is a “security” which gives the holder a financial claim on the issuer. This claim protects the holder in circumstances in which the issuer is unable to pay the amount due. There are various types of bonds that you can purchase. Bonds are similar to Certificates of Deposit. Instead of being issued by banks, however, bonds are issued by the Government or private companies. Depending on the type of bonds that you buy, your initial investment may double over a specific period of time.

Mutual funds are also relatively safe. Mutual funds exist when a group of investors put their money together to buy stocks, bonds, or other investments. A fund manager typically decides how the money will be invested. All you need to do is find a reputable, qualified broker who handles mutual funds, and he or she will invest your money, along with other client’s money. Mutual funds are a bit riskier than bonds.

One of the safest, yet mis-understood investment vehicles with government guaranteed interest rates of between 12% and 50% with the potential for even more are Tax Lien Certificates.

Unpaid property taxes often create a cashflow problem for local governments. To solve this problem, local governments allow investors to pay off these taxes. The investors receive the government’s lien for property taxes.

Depending on state laws and competition, investors can realize returns as high as;

* 16% per year in the state of Arizona (Sec. 42-18053),

* 18% per year in the state of Florida (Sec. 197.172 (2)),

* 20% per year in the state of Georgia (Sec 48-4-42) and

* 50% per year in the state of Texas (Sec. 34.21 e 2)

Clearly, a rate of return guaranteed by a local government and backed by real property with the right of foreclosure is an incredibly safe investment with a very high rate of return.

For more information on how to invest in Tax Liens as a safe investment visit: http://www.ezandfree.com/safeinvestments.html

David E. Brumbaugh is the Owner and Operator of EZAndFree.com as well as several other web sites. To learn more about how to use tax lien certificates as a safe investment, I recommend the following educational and property location resource:

“Tax Leins Made Easy”: http://wwww.moredetails.info/safeinvestments1

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The main thing tax will need for tax mistakes income tax return is proof of the income you made and the taxes you paid in the previous year. That includes income made through employers, interest from accounts, dividends from investments, income made through self-employment, income made as a subcontractor, and any other income. Student loans and other types of loans may also be considered income for the purposes of income tax, as can winnings from a lottery, casino, or other contest. If you are unsure what can be considered as income for tax purposes, you should contact a certified public accountant.

The other thing that is important is social security numbers for everyone you will claim on your income tax return. That includes social security numbers for your spouse and any children you will claim. Without social security numbers, proof of residence, and birth dates, you cannot claim deductions on your income tax return for these individuals.

The next thing that you should gather is what you will need for deductions. If you have a mortgage, your interest paid tax the mortgage company may be tax deductible. If you use a vehicle for business purposes, you can claim a tax deduction for mileage. If you have children in daycare so that you can work, you can claim a tax deduction for that expense. You can also claim tax deductions for excessive medical expenses and charitable contributions.

If you are self-employed, you will need to also gather your receipts for tax deductible expenses. A tax deductible business expense is any expense that is used solely or primarily for the business you are involved in. The tax deductible expense must be documented in order to claim it, so any receipts you have, usage logs for computers and vehicles, etc. should be gathered so that you can take the highest deduction possible. If you have any doubts about what is tax deductible for your business, you should contact a certified public accountant to assist you in your income tax preparation.

Once you have gathered all of the necessary tax documents, you must determine which tax forms you need to file. If you are an individual with few tax deductible items, you can file a simple tax return. However, if you are self-employed you must also file a tax form called Schedule C. If you have a lot of tax deductible items, you will want to file a more complex tax return to itemize your tax deductions. If you are unsure what tax forms you need to file, you should contact a certified public accountant to assist you in your income tax return preparation.

Tax day can be a stressful time, but it doesn’t have to be. Gather all of your required tax documents as early as possible, and don’t put off the inevitable. Contact a certified public accountant as soon as you can if you are unsure what tax forms you need to file, or what tax deductions you can take. And, most importantly, don’t panic on tax day!

For more information on the accounting field please visit
http://www.bytelan.com/indexaccounting.php

John Tahan is a webmaster, computer expert and musician, for all your musicians and music lovers you can visit: http://www.tzarrockmetal.com, http://www.guitarapprentice.com

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You should if you want to take full advantage of a tax deduction many people overlook. The home office deduction allows individuals to deduct expenses that are not otherwise deductible such as utilities and homeowners insurance. There are certain requirements you must meet to have a home office, including:

You own a business (if you are an employee, you must meet the “for the convenience of the employer” test). You have an area set aside in your home used regularly and exclusively for specific administrative or management activities There is no other place of business where you conduct those activities

These requirements help you to determine whether the area used in your home is your principle place of business for certain business functions.

If you don’t think the area you use qualifies, you may just need to change the facts. Are there too many nonbusiness items in your office area? Move them to another room and you may qualify. Are you struggling to find business activities that you can do at home? Bookkeeping, billing and ordering supplies are just a few activities that are easily done from home.

Once you’ve determined that you have a home office and you would like to take the home office deduction, you need to track certain expenses.

Allowable home office expenses include:

- Utilities

- Mortgage interest

- Property taxes

- Homeowners and liability insurance

- Repairs and maintenance of office area

- Depreciation of office area

Deductions that do not qualify as home office expenses are items that do not relate to the home office such as landscaping and pool care. In addition, taxpayers are denied a deduction on a first phone line regardless of the level of business use. A taxpayer must have a second phone line to deduct telephone expenses, long distance charges and internet service.

Of course you can’t deduct 100% of these expenses. The expenses are allocated based on square footage or number of rooms in the house. In most cases, the number of rooms allocation yields a higher deduction, make sure your CPA calculates both numbers to maximize your deductions.

- What You Should Know About Home Office Deductions -

Home office deductions are allowed for areas used exclusively for the management and administrative duties of the business when these functions are not conducted in the principal place of business.

Prior to 1999, the IRS regarded the location of major business transactions, based on time usage, as the principal place of business. For example, sales conducted in customer’s homes disallowed the home office deduction, even if invoicing, bookkeeping and other management functions were conducted from the home. Now these responsibilities are accepted for home offices.

However, if multiple businesses are conducted from the home, separate office space should be allocated, or the entire deduction taken, in the most active business. This is particularly important where spouses each conduct business from the same home office space.

Home Office Requirements:

The home office must be an area in the home set aside and used regularly and exclusively as an office. No other fixed place of business can be used to conduct the same business regularly.
General expenses of your home are deductible in proportion to the business office percentage of your home. This can be measured either by square footage or by number of rooms, excluding bathrooms and hallways.

Certain home office expenses must be paid through your company, while others are personal expenses.

The following items should not be paid by your company:

- Mortgage expense and interest.

- Property taxes.

- Homeowners and liability insurance.

- Repairs and maintenance of the office space.

The following items should be paid through your company:

- furniture and fixtures purchased specifically for business purposes, whether stored in the home office or at another location.

- Separate business phone lines that are installed at the home office.

- Office supplies.

- Other items specifically used for the business.

The following items are not generally deductible:

- Landscaping and lawn maintenance.

- Pool care.

Tom Wheelwright is not only the founder and CEO of Provision, but he is the creative force behind Provision Wealth Strategists. In addition to his management responsibilities, Tom likes to coach clients on wealth, business, and tax strategies. Along with his frequent seminars on such strategies, Tom is an adjunct professor in the Masters of Tax program at Arizona State University. For more information, please visit http://www.provisionwealth.com

Tags: administrative duties, advantage, Ally, amp, Ast, Bookkeeping, business, Business Activities, ceo, cia, Coach, convenience, creative, Employ, Employe, Expenses, find business, Fre, furniture, home, inc, informat, insurance, Irs, lows, Mai, many people, mortgage, Mortgage Interest, oic, People, Personal, phone expenses, pool, principle, Prope, property tax, property taxes, proportion, Rate, Regard, Rsi, sales, sit, Target, Tax, tax deduction, Taxes, taxpayers, Wheel

Apart from the financial and accounting services that accountants provide, many people are oblivious to the fact that accountants are just serving a host of government departments with the work that they render. Tax, statistics and labor related issues are areas where accountants are compelled to comply.

It is believed that governments would collapse if accountants in practice were to stop submitting all the taxes on behalf of their business and individual clients. Hence, tax and legal subjects are compulsory for any accounting student.

Like all sectors of the economy, accountants play a vital role in developing society, and their services to their respective countries should be acknowledged. Their skills enable states and countries to prosper.

The statistics generated in tax forms, labor etc. is an important barometer of economic and employment growth. Accountants contribute to the formalization of businesses that would otherwise have been outside of the tax Their assistance, ensures that more businesses are established, bringing in more tax revenues for governments.

Where do we draw the line? Are accountants obliged to co-operate in every arena?
The accountant carries a huge responsibility in complying with the law at all times.
The laws of democratic dispensations, however, entitle the accountant to privacy.
Accountants are NOT at liberty to divulge certain information that is regarded as confidential. In their haste to appease authorities, they loose sight of the importance of accountant-client privilege.

Authorities, in western countries, as well as other democracies, are passing numerous laws that effectively “coerce” accountants and financial tax to report irregularities and “suspect” transactions in tax, share dealing and financial instrument trading. After Enron and World Com, authorities are keeping a close eye on financial advisors. These regulations are welcomed, but places advisors in a precarious position.

Honest mistakes can me misconstrued, as serious transgressions. Accountants lack the capacity to scrutinize every transaction in their client’s books. The hosts of laws being passed in many countries are turning advisors into bloodhounds, when they should be “watch dogs”.

A fine balance should be struck between the requirements of the law and the needs of business owners. Clients pay for the services, after all, and their opinion matters most. Of course, unethical or illegal behavior can never be countenanced.

It is advisable that recourse should be sought in those laws that demand court orders or search warrants before information is obtained illegally by tax Many “demands” circumvent basic, common law principles.

Accountants should act like attorneys, and defend their client’s interests, first and foremost.

Accounting and finance related queries can be addressed, on our website. Feel free to visit our site by clicking on the url below. Sean Goss website: http://www.sgafc.co.za

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Many taxpayers don’t ever consider checking to see if they fall into the AMT. In fact, many don’t even know what it is.

Those that attempt to figure it out, often get confused by the calculations and simply assume that they don’t owe it.

“Many taxpayers are unaware that the AMT applies to them until they receive a notice from the IRS, and some discover they have AMT liabilities that they did not anticipate and cannt pay,” said Taxpayer Advocate Nina Olson in a report to a congressional subcommittee last year.

While the instructions for Form 1040’s line 45 (where you enter your AMT amount) require taxpayers to fill out fairly simple worksheet, the taxpayer ahs to read 16 exceptions to that worksheet that refer the taxpayer to go directly to Form 6251to figure potential AMT liability.

Many don’t know where to even go for the form, as they simply picked up a 1040 and started filling it out as usual.

One of the exceptions is “interest paid on a mortgage not used to buy, build or substantially improve your home.” Does this mean that home equity loan that consolidated the credit cards?

“There’s no one thing that one can say for sure ‘this is going to be an AMT problem,” said Mark Luscombe, a principal analyst with CCH.

Many are shocked to find that they are in the AMT. After all, it was originally intended to stop the wealthy from avoiding their income taxes.

“You don’t have to be making a lot of money to fall into the alt-min anymore,” said Barbara Steinmetz, a certified financial planner. “Property taxes help boost you there. State income taxes help boost you there.”

“If you are working through the 1040 and you go line by line, you shouldn’t miss it,” says the IRS.

The AMT currently traps high-income taxpayers with difficult tax situations. Most of these are aware of the issue, because they have their tax returns prepared professionally.

Without yearly patches on the AMT, millions of middle-income families could be subject to the parallel tax.

“It’s like watching a horror movie and there’s this slow moving creature that’s about to consume the middle class,” said Len Burman of the Urban Institute and the Tax Policy Center.

Martin Lukac represents http://www.RateEmpire.com and http://www.1AmericanFinancial.com, a finance web-company specializing in real estate and mortgage rates. We specialize in daily updates, mortgage news, rate predictions, mortgage rates and more. Find low home loan mortgage interest rates from hundreds of mortgage companies!

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