I have 10 items listed on ebay. Four have bids, another 4 or 5 have people watching the item. The auctions end tomorrow night. And those last seconds are when most of the activitiy occurs! Fingers crossed for high bids.

We have learned in the last week that our housing allowance will go down, since my husband is now stationed in another state. It will go down from $1521 per month to $1422, a drop in our income of $99 per month, or about $50 per pay period.

I did decide to cancel the newspaper subscription. It became effective this week. We are very aware that it is missing. It is one expense we got a fair amount of enjoyment out of. But, it's a trial for now. The cancellation saves us $17.39 per month.

We have $100 worth of rewards from our debit card that can be redeemed. I'm resisting at the moment since it seems it could be worth more as we get closer to the holidays and that money will come in handy.

I was invoiced this week for our sliding door, siding repair and painting. Total outflow for those expenses was $3,209.45. It was a necessary expense that will help avoid issues when we go to sell. I do really like the new sliding door. It works so well!!

With the repair and recent expense for my husband's move we have nearly depleted the extra $7000 that we saved last year. That is really hard to watch, but I know without saving that money it would have been far worse! The good news is that we will receive money from the Army for the move. Right now, I'm estimating we will receive about $4100. Not bad, huh?

In other good money news, DH's paycheck will be about $225 more than usual next week. This is a result of taking vacation or leave that he earned in a combat zone. Those days were non taxable earnings, thus less money was taken out for tax withholding.

It seems most of those updates are good news. I am starting to feel better about our cash situation. It is all going to work out.

I looked at our 2011 goal page on my sidebar. It seems we have accomplished just about everything listed. Savings for college and retirement are on auto pilot. We paid off the van and saved the $12K for the truck. We even paid for our Las Vegas trip in cash.

One of the goals was to pay for two vacations, but in light of my husband's move, we have decided to reevaluate. Right now, taking a vacation is not financially feasible, and the time available is very limited.

The other goal is to consider converting more money from my husband's Rollover IRA to his Roth. This amounts to just under $6,000. It seems this would be a good year to do this, with the lower income from deployment, but it could also be a good year to qualify for the Earned Income Tax credit and receive a nice refund. The extra cash is a bit tempting. I will probably wait until the last minute to decide.

Since my husband is now home from deployment we expect to see his paycheck amounts go lower. He no longer qualifies for tax exemption, or combat pays, worth nearly $1100 per month. Boy, it sure was nice!

I will need to rework the budget in light of lower paychecks, a new loan and an upcoming move for DH. I expect the next year to be tight particularly because of the move.

It seems I will need to start watching those pennies a little closer. I might need to decide about canceling the newspaper and the landline. So hard to give up, especially when those would only save us $50 or so a month. I would expect the groceries may be the bigger issue. It seems everytime I go to the grocery store in the last month some item has increased dramatically. Yesterday, it was shredded cheese. I will need to watch for these items on sale and stock up!

I know some of you reading have already cut back in light of job losses and paycheck reductions. It now appears to be our turn. Any advice?

Our federal tax refund, $1,990, was deposited into our account today. We do owe our state $124 by April 30th (yes we get a delay here). We will save the $124 and pay the state just before the due date. The remainder of the refund, $1,866, will be saved for the truck purchase.

New Truck Savings Balance: $4,556

We are getting closer each time money comes in!

If you are getting a tax refund, what are you doing with yours?

It's been a productive weekend! This puts me on a great foot to start the week and accomplish more.

I did the usual tasks of making a grocery list, getting groceries, doing laundry and helping with homework. I also officially filed our taxes, washed the van floor mats (since we had a warm day), vacuumed the van, and finally sewed two curtains and six coasters for my sister. I also cleaned up after myself!!

Since I was so productive, I didn't have time to ponder the "What Would I Change" topic! We'll see, I might weigh in tomorrow. Nice to see what everyone has to say.

I should probably have posted about organizing your tax information prior to suggesting you look for the least expensive way to file (yesterday's post).

I keep a manilla file folder for each tax year. The year is written in permanent ink of various colors to make it more fun! I make the folder at the beginning of the calendar year, so that if something tax related comes up there is a place to file it. Receipts for donations of cash or household goods get put in there throughout the year.

As tax season approaches, now, I write on the inside cover what documents I will need to file our taxes. I use the prior year return to help me know what those items are. As we receive the tax forms in the mail or online (you do know many tax forms are online, right?), I simply checkmark the item off. Once all the items are received, I know that I'm ready to do my taxes. Or, if you don't do your own tax return, you know that everything is ready for your preparer.

After I efile, I print a hard copy and save the return on our hard drive. I kept the hard copy with all the supporting documentation in the same file folder. I even go so far as to put the documentation in order of how it is entered on the tax return. Does anyone else do this?

I keep the prior year and current year folders in my everyday file drawer. The older ones I kept in a file drawer in our basement. I have to say I have not ever thrown a return away. It is an interesting documentation on income. I'm sure I will at some point, since I know I can't be audited back to the previous century!

How do you handle your tax bookkeeping?

I was prepared to pay to use a software service to do our taxes. I seem to switch between Turbo Tax and TaxActOnline every so often. This year I entered everything into TaxAct and was planning to pay $13.95 to file the federal and state returns. This price was a special I locked in before the new year.

I decided I should see if there were any online tax software that would allow me to save $13.95 and file for free. We are military and our income was lower this year, so I gave it a shot.

I went to the

irs website to find a free file program we might qualify for. Sure enough we qualified (most people with an adjusted gross income of $58,000 or less will) because of income and our military status with Turbo Tax Freedom. And best of all our state happens to offer free filing with this program as well.

I suggest you look for the least expensive filing option. In some cases, it might be pen and paper! Only file your own taxes if you are comfortable. I've been filing my own taxes since I was 16 and simply learn along the way. No audits yet!

Happy Tax Filing!

I haven't filed our returns yet, but it looks like we get a refund from federal and pay a small amount to the state. This takes into account both of our Roth conversions that occured in 2010.

Married couples can each specify how they want the taxes handled on the conversion in their name. I could have opted to pay the tax on my Roth conversion in 2011 and 2012. As could my husband. However, since it will definitely not help us to have additional income on our return in 2012, we are paying the tax this year. This year our taxable income is quite low because we do not have to pay income on income earned in a combat zone. It's so low that if I had not converted so much money to the Roth IRA's we would have been eligible for the Earned Income Tax Credit. Weird. It's been our best income year.

Federal: $1,990
State: ($124)

I will do another review of my inputs this week. If all looks good I will file, even though the IRS won't process it until mid February. It doesn't hurt to have it done!

If you want to know when you would receive your refund based on the date you file check out

this irs publication.

This can be a great planning tool for those of you who really need your tax refund by a certain date.

Get those taxes done sooner and the refund is in your account sooner. It's your money, don't let the government have it any longer than necessary!

Oh, and for those of us who itemize, the IRS is not processing returns that have a Schedule A until mid February because of the delays in Congress last month. My understanding is that you can still efile and most software companies will hold on to your return until it can be sent to the IRS.

Okay. I'm not really in hiding, but if you are not hearing from me it's because I'm working on our taxes. We have officially received all of our tax forms either by mail or downloaded online.

I realized that I actually get a choice about whether to pay taxes on my Roth conversion this year or split between the next two tax years. Most of my husband's IRA's were converted as well. His conversion we are definitely paying this year since our taxable income is so low. But I'm going to play mine two ways and see which is the better outcome for us.

See you later when I dig out from tax filing!

It turns out I won't be able to file our taxes as early as I usually do. We itemize, and it is one of three reasons that the IRS will not accept returns until mid to late February.

This

article also states the filing deadline has actually been moved to April 18th. At least I get three extra days. Even though I can submit the return I will have it all completed by the end of January.

As of now, I have already entered in our donations into the online tax program I plan to use. It's taxactonline.com. I have had good luck with it most years. However, I think last time DH deployed it didn't work so well and I had to use something else. We'll see how it goes this year.

It is a good time of year to set up a file to collect all the needed tax documents you will need to file your return. I refer to the prior year to see what I have needed in the past. I actually write down what items I need and then check them off as I they arrive or I find them online.

Happy Tax Filing Season!!

My year end list of things to do today and tomorrow.

1) Pack up a few more items to take to Goodwill. The girls found about 6 CD's and 2 DVD's they are done with. I checked online and they are only worth about a dime a piece...so off they go to charity. We also found four pairs of mittens, some new but too small.

2) Make a final donation towards our charity.

3) Rabies shots for the cats.

4) Basic cleaning. It's just nice to start the year fresh.

I made our last non cash donation to Goodwill today. I have already entered all the items donated in the last year to my tax program. The total value, based on thrift shop values, is $1098!!

Wow! It sure didn't seem like that much stuff, but it will offset the amount of taxes we pay by a little bit.

I'm going to add in each tax form as I receive it this year, with hopes that many of them will be available online by the middle of January. My husband's W2 will not be available until January 24th, but it would be nice if that is the last form I need. I would then be able to file by early February!

I filled a prescription yesterday at Target and redeemed a coupon for a $10 gift card. I'm not sure when I expect to use it. I might just see how long I can hold on to it!

I'm spending the day baking breads to give as gifts. It smells yummy in here!

I'm also going to make a run to goodwill with some final donations. Turns out the items I listed last week on craigslist did not sell. Again. So it is time to just let go.

Let me just say it: Oops!

Earlier in the year I estimated our federal refund as well as our state return. Um. I did it wrong. And not in our favor.

I thought we would get a refund of $2870 and owe our state about $50. Turns out I forgot to include some of the money I rolled over to a Roth IRA, almost $6,000!

So...we'll still likely get a refund of about $1872, but owe the state about $500. Instead of net $2820, we'll net, $1372. That's a difference of $1448. Darn.

I suppose there is a possiblity that I did this last calculation wrong. It is an estimate and likely to change slightly.

Is anyone else already estimating their tax return? Or is it just me?

It's official. The amount deducted from your paycheck for social security will be reduced from 6.2% to 4.2%. Obviously, this is a good thing for your paycheck. I'm not so sure how it is good for the social security program.

For us, that is about $115 more per month. My husband's basic military pay will also increase by 1.4% in the new year. It's a lower raise than in the past, however, we are grateful for any raise at all. Not everyone is so lucky.

I will be working on figuring out how our pay will change in the new year. Once I know the dollar change, I need to figure out how to allocate it to meet our goals in the next year. I like that!

What plans do you have for your social security tax savings?

This post is just some of my thoughts about next years goals. Things are iffy since we could be moving. The income will stay the same. The expenses could change.

We will continue to save at least 15% towards retirement.
We will contribute to our daughters college funds.
We will pay off the van very early in 2011!!
We will pay a large percentage in cash for a new to us truck.
Then...we pay off the small loan on the truck. If there is one.
And we will go on a couple's vacation and a family vacation with cash!
I will also look into converting some more rollover money to Roth Ira's.
I need to consider more to the emergency fund.
If we don't move, I need to look into refinancing or at least pay extra on the mortgage.

I'll round out all those goals out later with numbers.

Our real estate taxes are increasing by $98 per year. This amounts to an increase of just over $8 per month. I already had a little cushion built in, but I will need to begin allocating another $5 per month to meet this new amount.

I currently save $285 per month to include homeowner's insurance. I will increase this payment to $290. This basically our own escrow account since it is not handled by the mortgage company. I love that I can do it on my own!!

Next payment for real estate taxes is due on September 1. I will pay them online.

I took my two daughters and two neighbor girls swimming today for a total of $19.50. That included snacks. They pitched in $5, so only $14.50 out of my pocket.

The girls had a great time and it was a help to their mom who just had her gall bladder removed. I also baked banana bread for something to eat in the morning.

It is tempting to spend tomorrow as our state is having a tax free holiday on clothing. If I get the cleaning done for Saturday's visitors then we might venture out and get the few items we need for back to school. Otherwise, it is sometimes just easier to skip it since so many people will be out shopping!!

I made a Goodwill donation today of three boxes. Yes, primarily leftover garage sale items. I did keep some things for our fall sale. Probably too many things!

I did finish sorting the books and clothes from my sister. I kept a shirt and a pair of pants. I also pulled two books to read. I will attempt to sell them at the next sale.

While sorting books yesterday, I attempted to see if any could be sold on the cash for books websites. There seemed to be two or three that I could sell. I just need to decide if it is worth my time for $3.

Yesterday was a no spend day. Today I purchased a sympathy card and a couple of stamps. Money well spent.

My friend with the bats is charging the bat removal fees to a credit card. She doesn't know if she can make the payments. However, she mentioned she could pay it off NEXT year with her tax refund. I'm aware that they often get large tax refunds, so I suggested they increase their withholding to get some of that money in their pocket NOW to pay those credit card bills. I wrote her an email, and no response yet.

Most people in the US love their large tax refunds. It is like winning a small lottery. Unfortunately, that is your money that the government has their hand on all year long and they aren't even paying you interest! You can change this, so that the money is in your pocket now.

Last year, our refund was $399 from the federal government. I think if the Making Work Pay was not in place we would have nearly broke even on taxes. It has taken a few years for me to get it that close, but it nice to see the government doesn't have access to so much of our hard earned money.

First go to the IRS website, and use their

withholding calculator to determine their suggested number of withholding allowances for your income. Compare this to what you already withhold. It generally will be a higher number than what you are already claiming. Some people only claim allowances based on the number of people in their family. We have four members, but we claim 9 allowances.

If the witholding calculator on the IRS website is confusing, you might consider looking at an actual copy of a Form W-4. It has written instructions, that tell you based on your situation what number of allowances to claim. This is the same form you will fill out at your employer to change the number of allowances want to claim.

I bet now you are worried or curious about how those increased allowances will change your paycheck, right? I've used this website at paycheckcity.com for years, to calculate our net paycheck. (I noticed this website also has a W-4 assistant, or another calculator to determine your allowances.) Play with it a bit. Try the witholding the IRS suggested. Look at how much extra you will get added to your paycheck each pay period! Nice, huh? That's your money the government was going to hold on to for you until the next tax filing period. You want that money don't you?

If you still want a bit of a refund, consider lowering the suggested withholding by 1. Also remember to go back to the calculator at the very beginning of 2011. Your withholdings may need to change because this year you are adjusting mid year. The number may be higher to make up for claiming less allowances earlier in the year.

Just messing with the calculators will give you lots of information. Remember to actually fill out the new Form W-4 with your employer to make it happen.

Okay, I did go to bed by 11pm...but it felt very late to me. I was working on next years tax estimations! I know. I'm a nerd.

Three quarters of our income next year will non taxable! Love it. We have converted about 2/3rds of our Rollover IRA accounts to Roths to take advantage of a year when our income will be lower for tax purposes.

My calculations involved figuring out how much of the remaining 1/3 our our rollover accounts should be converted this year, if at all. It looks like I should convert half of the remaining balance to benefit us in both tax years. The main benefit of spliting this way is to qualify us for the earned income tax credit in both years.

Of course, everything is just estimated right now, but I have to make the decision based on something!

About 5 months ago, I inquired with our mortgage company about deleting our escrow account. We were eligible!

I have been saving money on a monthly basis towards our real estate tax bill ever since. They are due this month, and I just made the payment without the mortgage middleman for the first time. It feels great!!

Since it was the first time I made the payment with the county I was given the option to be notified by email when taxes are due. I signed up. I had marked the dates on my electronic calendar, but it doesn't hurt to have another reminder. I don't want to lose the house because of an unpaid tax bill!

If your eligible, I would highly recommend paying your own taxes! You pay your other bills on time, right? Why can't you pay this one?

I converted two thirds of our Traditional IRA accounts to Roth IRA's today. It's a bit scary to pull the trigger, when you know it is a taxable event.

I'm have already looked into the tax consequences and they are quite favorable for us as most of our earned income will not be taxed this year due to the combat zone exclusion. Of course, we still have to pay taxes, but not much different than a normal year for us.

I will decide about the remainder of the IRA balances later.

I e-filed our taxes last Wednesday. Both were accepted in less than 24 hours!

I can see that the state refund is a pending deposit in our checking account for tomorrow. I expect to see our federal refund on Friday, since that is the expected deposit date they listed when our return was accepted.

Fast. I like fast.

I hope to get some of this money in to our home equity loan next week. I will finally get to write an update!!

I think we can convert our Roth IRA's in 2010 without any money out of pocket. In fact, I expect we will still get a refund.

Approximate calculations:
$54,940 AGI
($12,100) itemized deductions
($14,600) personal exemptions (4)
$23,240 Taxable Income

$3,398 Tax before credits
($2,000) Child tax credits (2)
($400) Retirement savings credit
$998 Total Tax

$814 Withholding
$800 Making work pay credit
$1,614 Total Payments

Payments - Tax = $616 Refund

AGI includes 2010 taxable income, roth conversions, interest income and 2009 state refund. Most of our income in 2010 will be non taxable because of it will be earned in a combat zone.

We qualify, just barely income wise, for the retirement saver's credit on our 2010 roth contributions, which we will max out this year.

I'm being very conservative with our itemized deductions as well. We may end up donating more or having a little bit more interest to deduct since we have yet to pay off the home equity loan.

If I convert less money to the roth's we could actually qualify for the earned income tax credit. Crazy. Financially, it will be our best year yet. One scenario I ran where we qualified for the EITC, we would receive a refund of $2875.

Can you see anything wrong with the detailed plan above?

I had to compete online yesterday with all the other military members to obtain my husband's W2! Once that was obtained, I plugged the numbers into the online tax program. We are using taxactonline.com. I paid $17.95 to print, and efile both income tax returns.

The result is a refund from both the federal and state governments. Unfortunately, the refund is more than expected. Seriously, I can never get us to zero!! I try. I really do.

Federal Refund: $399
State Refund: $728
Total Reunds: $1,127

I was only expecting around $700 total. I'm sure I can find a place to put the extra $400+ !

Currently, I'm holding on to extra cash. With deployment nearing, my husband has expenses that I can't quite anticipate. Last week he bought a new duffel bag and tshirts. We spent about $100!

At some point...that home equity loan will be paid off. Maybe even in one lump sum!

Anyone else have their taxes done?

First of all, I keep thinking about Monkey Mama and her husband. I don't remember the exact surgery date. It could be today. Yesterday? Not sure. My prayers and thoughts are focused on a good outcome. Send your own positive vibe their way if you feel so inclined!

A benefit of participating in a combat zone is tax free income. My husband is going to get a bonus month of tax free income because of a 10 day trip to the 'zone' in the near future. Actually, you only need one day in the 'zone' to qualify! We still pay Medicare and Social Security taxes.

This extra month only helps convince me that we should convert our IRA's to Roth's this year. I just want to know what it will end up costing us. I think we have at least $30K that we could convert. Of course, we don't have to convert it all. If I remember correct, we can split the tax bill between 2010 and 2011. I wonder if it has to be an even split?

Ebay update: I have three items listed and two already have bids!! I also found several books that I think will sell best on ebay, so I will get those up this Sunday.

Kids are home because of ice. We are getting 1/2 inch or so. I think school may be extended until mid June!!

I have found nearly all of the tax forms that financial firms we do business with are online. The 1098's from the mortgage companies were both online. I was able to download the 1099-INT from our money market account as well.

Next week I hope to be able to get my husband's W2 online as well. Actually, that is the only form I'm waiting for. I will probably have filed our taxes by this time next week! Cool, huh?

The 1099G from our state came in the mail, so not everything is available online. But it sure doesn't hurt to start entering the information from the tax forms as you can get your hands on them.

Do you have a place to put the tax forms you receive yet? If not, get out a folder now so you have one place to go to when you do your tax return.

I use a basic folder and actually write notes on the inside of the folder. I include a list of tax documents I need and check them off once I have entered them in. I also use it to make some calculations. Although maybe not the best idea, I listed the user name and password for the online program I'm using this year.

Tax filing can be quick and painless if you are organized and stay on top of the things you need. Need a hint about what you need? Look in last year's tax file or a copy of your 2008 return.

Happy tax filing!

Right now, all I'm really thinking about finances is: try not to spend anymore money until payday! We will get paid on December 30th because of the holidays.

December is a spendy month. It's not just the gifts, but the food, the gas for traveling and batteries!

Okay. You know me to well. I am looking ahead financially, too! I'm looking forward to making our next big dent in the home equity loan and updating our final numbers for 2009. The stock market seems to want to go up the last couple days and I want to include any gains!!

On a tax note: I think I will total up the value of our thrift store donations today and enter it into the tax program.