REAL ID starts in less than a year./0 Comments/in , /by

The REAL ID Act establishes minimum security standards for license issuance and production and prohibits Federal agencies from accepting for certain purposes driver’s licenses and identification cards from states not meeting the Act’s minimum standards. The purposes covered by the Act are: accessing Federal facilities, entering nuclear power plants, and, boarding federally regulated commercial aircraft.

Beginning October 1, 2020, every air traveler 18 years of age and older will need a REAL ID-compliant driver’s license, state-issued enhanced driver’s license, or another acceptable form of ID to fly within the United States.

 

CHECK FOR THE STAR

REAL ID-compliant cards are marked with a star at the top of the card. If you’re not sure, contact your state driver’s license agency on how to obtain a REAL ID compliant card.

Individuals who are unable to verify their identity will not be permitted to enter the TSA airport checkpoint and will not be allowed to fly.  However, In the event you arrive at the airport without valid identification, because it is lost or at home, you may still be allowed to fly.  The TSA officer may ask you to complete an identity verification process which includes collecting information such as your name, current address, and other personal information to confirm your identity. If your identity is confirmed, you will be allowed to enter the screening checkpoint. You will be subject to additional screening, to include a patdown and screening of carry-on property.

 

You will not be allowed to enter the security checkpoint if your identity cannot be confirmed, you chose to not provide proper identification or you decline to cooperate with the identity verification process.

Other acceptable forms of ID include:

 

  • S. passport
  • S. passport card
  • DHS trusted traveler cards (Global Entry, NEXUS, SENTRI, FAST)
  • S. Department of Defense ID, including IDs issued to dependents
  • Permanent resident card
  • Border crossing card
  • State-issued Enhanced Driver’s License
  • Federally recognized, tribal-issued photo ID
  • HSPD-12 PIV card
  • Foreign government-issued passport
  • Canadian provincial driver’s license or Indian and Northern Affairs Canada card
  • Transportation worker identification credential
  • S. Citizenship and Immigration Services Employment Authorization Card (I-766)
  • S. Merchant Mariner Credential

 

 

Be mindful that you will need to go in person to present documentation to verify who you are in order to get your REAL ID.

HOW TO FILE TAXES FOR THE FIRST TIME/0 Comments/in , /by

As I travel across the country speaking at high schools and colleges, here’s something I hear from young adults all the time: “So . . . taxes. Where do I even start?”

Dude, heck if I know. I’m kidding. But let’s face it: Filing taxes is confusing. It’s intimidating. It’s one of the not-so-fun parts of being an adult. But it has to be done, especially if you want to build wealth (and, you know, be a U.S. citizen).

If you’re worried about when and how to file taxes for the first time, don’t stress—it’s actually not as complicated as it sounds. Here’s how to do it the right way.

1. FIGURE OUT WHETHER YOU NEED TO FILE.

Honestly, you might not even need to worry about filing taxes yet (praise hands)! But before you breathe a sigh of tax-exempt relief, there are a few basic details you need to know to figure out whether or not you need to file.

Here are some common questions you might have about this step:

DO DEPENDENTS NEED TO FILE TAXES?

Even if you’re technically still dependent on your parents (you live with them, they pay your bills, etc.), and even if your parents still claim you as a dependent on their own tax return, you might still need to file based on how much money you earned in 2019. Read on, my friend.

HOW MUCH MONEY DO I NEED TO EARN TO START PAYING TAXES?

So, let’s say your parents claim you as a dependent on their tax return, you’re not married, and you’re also not blind or over the age of 65. You should file taxes if one of these situations applies to you:

  • Your earned income was more than $12,200.
  • Your unearned income was more than $1,100.
  • Your gross income (the money you earn before taxes are taken out) was more than whichever of these totals is bigger: either $1,100 or your earned income plus $350.

If you’re living that single life, your parents don’t claim you as a dependent, and you’re under 65, then you’ll need to file if your gross income in tax year 2019 was at least $12,200. If you’re married and filing jointly (meaning you and your spouse are putting all of your details on the same tax return), you should file if your gross income was at least $24,400. (Nothing’s more romantic than filing taxes together, am I right?)

HOLD UP. WHAT’S EARNED AND UNEARNED INCOME?

Earned income is any money made from working a job, like your salary and wages, bonuses, commissions, and tips. Unearned income is money earned without working—interest earned from a savings account, for example.

Some other forms of unearned income include alimony, dividends, capital gains, etc. But if this is your first time filing taxes, I’d be willing to bet that interest is the only type of unearned income that applies to you.

IF I’M A FREELANCER, DO I NEED TO PAY TAXES?

If you earned at least $400 from freelance work during the year, then you need to pay taxes on it (bummer). My main man Dave Ramsey suggests setting aside about 25–30% of every check you get from freelance work, so you aren’t left hanging when tax season rolls around.

2. GET YOUR DOCUMENTS TOGETHER.

There are a few different documents you’ll need in order to file your taxes. (This is the fun part.) You’ll need at least one of these:

  • W2 form: If you earn a salary or wage, your employer will send you this.
  • 1099 form: If you’re a freelancer or self-employed, you should get one of these from every client who paid you at least $600 during the tax year.
  • Charitable donations: If you donate to a nonprofit religious, educational, or charitable group, make sure you get a donation receipt because you’ll need that at tax time!
  • Mortgage interest statements
  • Investment income statements
  • Form 8822: You’ll need this if you moved in the past year.
  • SS-5: You’ll need this if you changed your name in the past year.
  • W-4: If you had a job change and started making a new income in the past year, this form will adjust tax withholdings.

Again, if this is your first time filing taxes, then the W2, 1099, and charitable donation forms are probably the only ones that apply to you (unless you already have a bunch of investments or own a house at 16 years old or something, in which case—what?). But it never hurts to double-check with a tax professional.

3. CHOOSE YOUR FILING STATUS.

As a first-time tax filer, this step should be pretty easy. Your filing status will help you know what your standard deduction is, how much you’ll owe, if you qualify for certain credits, and other official-sounding stuff like that.

There are five different filing statuses:

  1. Single: Your filing status is single if you’re not married (duh), divorced, legally separated, or widowed before the tax year.
  2. Married Filing Jointly: We’ve been over this one. This is for you lucky married people who choose to file a joint tax return. You can usually save more this way!
  3. Married Filing Separately: This one is for you married people who choose to file separate tax returns for whatever reason. That’s up to you guys, but make sure you look at both joint and separate options and pick the one that’s most affordable for you.
  4. Head of Household: If you’re not married, have paid for more than half the household expenses for the year, and can claim a dependent on your tax return, this is the filing status for you. This mostly applies to single parents.
  5. Qualifying Widow(er): You can still file jointly with your spouse if they passed away and you don’t get married again in the same tax year. This filing status is available for up to two years after the year of your spouse’s death.

Note: There are a bunch of other tax rules for special situations, like if your spouse is in a combat zone and can’t sign, you’re married but your parents still claim you as a dependent on their return, etc. I don’t have the time or energy to cover all of that in this blog. (Would y’all want to read a 20-page blog about taxes? I wouldn’t.) But you can find all of these details—and a lot of other answers to your questions—on IRS.gov, the official website for all things tax-related.

4. DECIDE IF YOU WANT TO TAKE THE STANDARD DEDUCTION OR ITEMIZE.

The standard deduction is a specific dollar amount that lowers the income you’re taxed on. Like we’ve touched on already, for single filers, that dollar amount is $12,200. For qualifying widow(er)s or people who are married filing jointly, that dollar amount is $24,400.

So, for example, if your filing status is single, you made $30,000 in 2019, and you decided to take the standard deduction, you would only pay taxes on $17,800.

To take the standard deduction, there are no extra steps you have to do—just file your taxes like normal and the IRS will let you know when or if you get any money back. With this option, it’s still possible for you to get a deduction (which means you might owe less money), even if you don’t have any itemized deductions you can claim.

Your other option is to itemize all your deductions. People who choose this option keep receipts of qualifying expenses throughout the tax year and record them in Schedule A (Form 1040).

Some examples of these types of expenses would be:

  • Out-of-pocket medical or dental expenses
  • Charitable donations
  • Large, work-related expenses that you weren’t payed back for (for example, some people can claim money spent on gas if they had to drive a lot for work)
  • Paid mortgage interest or real estate taxes

Depending on which tax bracket you’re in, a certain amount of money will be taken off your tax bill based on the total amount of your itemized deductions.

Most people go for the standard deduction because it’s easier and faster, but for some people, itemizing can save a lot more money. Talking with a tax pro can help you figure out which option makes the most sense for you.

Have a headache yet? Don’t worry, we’re almost done.

5. FILE YOUR TAXES FOR THE FIRST TIME LIKE A BOSS.

Okay, fam. You’ve got your documents. You know your filing status. You decided if you’re taking the standard deduction or itemizing all the way. Now it’s time to actually file your taxes.

There are a few different ways to do this:

  • You could get the help of a tax pro, which can seriously help with the stress and confusion (this is what about 58% of Americans do).
  • You could use tax software (which can be a good option if your tax situation is pretty simple).
  • You could fill out all the paperwork yourself and mail it to the IRS.

But listen up: No matter which method you go with, your 2019 tax return is due on Wednesday, April 15, 2020.

Once that’s done, it’s time to run a couple victory laps because . . . You. Just. Filed. Your. Taxes. For. The. First. Time! I’m so proud.

6.  WATCH FOR A REFUND (AND ADJUST WITHHOLDINGS IF NEEDED).

Within about a month of Tax Day, the IRS will let you know if you’re getting a tax refund—which is money back in your account. Y’all, this is not the time to go out and treat yo self. It may sound great, but this actually means that too much money was withheld from your paycheck throughout the tax year—all that money was yours in the first place, and you should get to keep more of it during the year.

There’s also a chance you’ll owe money to the IRS instead of getting a refund (this is actually better than getting a huge refund because it means you got to hold onto more of your money each month.) Just know you might have to take some money out of savings to cover that cost, so be intentional about budgeting and having your emergency fund in place.

If you get a really big refund or owe a lot to the IRS, you’ll want to adjust your withholdings (the amount of money that’s taken out of your paycheck for taxes).

Once you adjust your withholdings as needed, all that’s left to do is get organized for next year by buying a folder for all your tax documents and receipts (you’ll want to hang on to them for at least three years just in case).

Congrats, y’all—this means you’re officially an adult. Remember: If you need help figuring out whether to use a tax pro, use tax software, or file on your own, this quiz will help you out!

Written by Anthony O’Neal from AnthonyONeal.com

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Underdogs Win Too!/0 Comments/in , /by

Just about everyone loves a good comeback story or a feel good story. We love the drama. We tend to get energized when we hear about a person or a team that was outmatched, undersized, or even counted out, pull off a surprising victory. Psychologists say, “We often associate ourselves with the underdog because sometimes it is difficult to identify with the winner since we don’t win all of the time. The truth is a lot of people consider themselves underdogs so it’s easy to identify with a team we see as being an underdog [1].” But if you look closely at underdogs that win, you see a consistent theme; they don’t beat themselves and they are very opportunistic. In other words, you could say underdogs that win are good stewards of the situation.

The same truth applies to underdogs that win with money. This is good news; it means if you were not born with a silver spoon in your mouth, or you don’t have a rich family member that is grooming you to take over the family business, you can still win with money! You may have an uphill battle to fight, but it can be done. But we don’t have time to waste. We have to turn things around right now. We have to stop beating ourselves and cease making decisions that are moving us away from our goal of becoming financially free. To do that, first, we have to avoid debt. Avoid it all cost; especially credit card debt. I know credit card companies try to tempt us with reward points or bonus miles, but it simple is not worth the risk. All it takes is one missed payment, and you can reap the whirlwind of months of unpaid back interest that puts you further in debt and moves you further away from winning. We also have to avoid the urge to go invest in the “hottest stock”, or try to get in on the latest craze, or buy into the latest “investment product”. Don’t get distracted and keep your eye on the goal. Those are money traps and I’m going to tell you why. Often the product or business model being pitched is oversimplified or, just as worst on the opposite side of the spectrum, are really complex and confusing. These ventures can have hidden or complicated fee structures that lead investors to misguided expectations. Hard pass. If you hear things like, “this is a revolutionary new product” or “act now on this special offer”, you should immediately be alarmed. You don’t need the latest gimmick to win. Millions of people were winning before the latest gimmick and millions of people will win after the next gimmick. But winning always comes at a cost. One of the things it will cost you is discipline (No. That is not a cuss word! It’s in the bible!). If you discipline yourself to stop burying yourself in the hole of debt, focus on paying off your creditors, and commit to saving; you will win! How do I know? Because the Word of God says so! What? You don’t believe it? Are you calling God a liar?

Underdogs that win are usually extremely opportunistic. Let’s take football for example. If the favored team suddenly fumbles or misses a key opportunity to score, the underdog, more often than not, will take advantage of that mishap and use it to their advantage. Now, let me tell you how that relates to money. There are times when opportunities will come, but if you aren’t prepared to take advantage of them, move with wisdom, and steward the opportunity well, you will miss out. An opportunity may come in the form of a chance to earn extra money for paying off your debt or increasing your savings. Or it may come about as a chance to reduce unnecessary or frivolous spending. I don’t know what your chance, or chances, will look like because I’m not the God. But they will come. But those opportunities don’t mean anything if you don’t recognize them and act. That’s on you. God will create opportunities. God will prepare you. But God will NOT act for you! He will require you to move (in faith) and actually participate. And the value you get out of the opportunity, many times depends on your stewardship of the opportunity. Testimony time. Years ago, when we had a lot of debt, an opportunity to take a second job presented itself. This second job didn’t pay much and really didn’t seem to help us make much progress toward our goal of being debt free. But I tried to be a good steward of the opportunity and didn’t discount the small job (even though it came with a small check). But, after about 6 months, my stewardship was rewarded. That job led to a second job that paid almost 5 times more! It was as if God was using that first job as a gateway to the second, higher paying job. He created the opportunity. He prepared me. But He didn’t walk the path for me.

Underdogs can win with money in the real world, but it’s probably not going to just happen if all we do is pray about it. I have noticed, in my own life, God has used the process of struggle to develop resilience and hone our stewardship skills to transform our [financial] character. He permitted us to struggle to remind us there are consequences for our actions while, at the same time, making us better steward which grows our capacity for increase. After all, how can we be trusted with more if we are poor stewards over the few he has already given us? (See Matt. 25:14-40). So things must change. We must change. For an underdog to overcome the odds and take down the giant, they can’t hinder their progress by getting distracted, and they can’t afford to miss the God-given moments. Is it easy? No. But the real question is, “are we willing to get it?” I trust God will do His part, but we have to be willing to do our part. The choice is yours. God Bless.

[1] https://www.bcm.edu/news/psychiatry-and-behavior/why-we-root-for-underdog