BRACE FOR STOCK MARKET CRASH | David Morgan

Government Assistance To Help With Utility Expense

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  December 08, 2016       typesofaid.com Staff
Over three decades ago, Congress voted to establish a new program called Low-Income Home Energy Assistance. The U.S. government funds it with grants. When it was created, the Federal Social Service oversaw LIHEAP. Officials eventually transferred control to the Department of Health and Human Services. State governments also play a role in operating this assistance program.

Although LIHEAP originally only provided help with existing fuel or electricity bills, it has expanded to supply several related services. All of the program's features are designed to help low-income Americans maintain safe indoor conditions throughout the year.

How Does LIHEAP Work?

People with rather low levels of income can qualify for assistance. The government pays a portion of their cooling and/or heating bills. Americans may receive extra help in energy emergencies. This assistance makes it easier for people to afford other essentials, such as food, water, health care and clothing. The program also funds residential weatherization projects that reduce utility costs. It engages in energy-related education efforts. Government agencies use LIHEAP money to improve heating and cooling safety as well. They strive to prevent medical problems related to unsuitable indoor temperatures.

Who Qualifies For LIHEAP?

This program benefits a wide range of low-income families and individuals. People who rent their homes can qualify, even if they reside in public or subsidized apartments. A renter may be reimbursed for energy bills by the government. On the other hand, a landlord might receive the money and charge tenants less rent. Most states allow people to use LIHEAP while receiving benefits from other agencies. It doesn't disqualify citizens from using the Supplemental Nutrition Assistance Program or Temporary Assistance for Needy Families. The same goes for Veterans Affairs and Social Security benefits. Nonetheless, it's important to check the rules for a specific state.

How Much Does It Pay?

Assistance amounts vary considerably depending on the situation. This program will pay different sums based on an applicant's income, state and number of family members. If someone lives in a house and uses it as his or her primary residence, the person will probably be counted as a family member. The payment also varies based on how much a household pays for heating and/or cooling. Citizens can qualify for LIHEAP regardless of their employment status. However, employed individuals must earn less than the income limit to receive benefits. Every state maintains a different limit.

Weatherization Services

This program devotes a portion of its funds to home repairs and enhancements. Such projects must improve a house in ways that reduce utility bills in the future. Some people use the money to buy insulation and repair drafty windows or doors. Any effort to seal outer walls and entrances will cut energy bills. It makes sense for LIHEAP to pay for weatherization projects because this reduces the public's need for fuel and electricity assistance. Most of this funding goes to homeowners. Rented dwellings also qualify for weatherization assistance, but the government requires landlords to contribute a significant amount of money.

Additional LIHEAP Services

This program offers different services depending on a person's location. State government offices can provide people with more information about the options that are available to them. In addition to paying upcoming utility bills, LIHEAP may assist citizens with overdue bills. It can provide funding for the replacement of air conditioning or heating equipment that doesn't work efficiently. The new units must be more efficient and capable of substantially reducing energy bills. This program may also work to prevent utility-related damage and injuries during emergencies. For example, it can help people shut off utilities in a flood or hurricane.

4 Creative Ways to Pay Off Your Mortgage Faster

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       typesofaid.com Staff
You want to pay your mortgage off as quickly as possible, but this can be quite a challenge. People often get into a habit of making the same mortgage payment each month and never considering that they have options that could shorten the process. There are, however, some creative and often overlooked ways to pay off your mortgage more quickly. Let’s look at some of the possibilities you might not have considered.

1. Make a Small Increase in Your Monthly Payments

Paying even a little more each month will shorten the length of your mortgage loan. You may have to adjust your budget here and there to find the extra money. Most people, if they look at how much they spend on frills such as fast food, coffee and impulsive purchases, can find ways to make a larger mortgage payment each month.

2. Make Biweekly Rather Than Monthly Payments

This is a trick that allows you to make the equivalent of one extra monthly payment per year. The reason for this is that when you make biweekly payments, you will be making a total of 26 payments in a year. This is the same as making 13 monthly payments rather than 12.

3. Use Tax Refunds, Work Bonuses and Unexpected Dividends Towards Your Mortgage

People often like to use tax refunds as a way to make fun purchases or perhaps take a vacation. While this can be nice, it will be better for your financial health to think of your tax refunds as a way to make some extra mortgage payments. Bonuses are another instance where you might have to exercise some self-discipline. It can be tempting to use your bonus to help pay for holiday gifts. If you’re serious about paying your mortgage off promptly, however, it would be wiser to use your bonus to make a dent in what you owe. The same principle applies to any type of unexpected dividends, such as inheritances, gambling winnings or a raise or promotion at work.

4. Refinance to a Shorter Term Mortgage

Refinancing to a shorter term mortgage will allow you to pay it off faster. This will entail higher payments, but it can be worth it in the long run as the day of your final payment is moved forward. The most common way to do this is to switch from a 20 year to a 15 year mortgage. If you can handle it, you might even consider a 10 year plan.

Unclaimed and Undelivered Tax Refunds

Unclaimed and Undelivered Tax Refunds

May 05, 2017 resourcedepot.co Staff
Did you not get a tax refund this year? Did you not send in a tax return because you think that your income is too low? If the answer to either one of those questions is yes, then you may be entitled to some money. Every year, millions of tax refunds are unclaimed and undelivered. In 2011, the IRS had $153 million in refunds that were waiting to be issued. There are a number of reasons that people do not receive their tax refunds.

Undelivered tax Refunds

Every year, the IRS sends out refund checks to about 30 million people. Some of these tax refunds are sent to the wrong address, so they are returned to the sender. Others are never cashed because they are lost in the mail. If you manually filed your taxes and have not received a refund, then you want to make sure that the IRS has your correct address.

Unclaimed tax Refunds

If your income was too low to file taxes, then you may still be able to get a refund. This is because you may be able to get an Earned Income Tax Credit, which is given to low-income earners. You can get this credit regardless of whether taxes were taken out of your earnings. There are income limits that apply. The maximum income is contingent upon your household size and whether you file jointly.

If you have an unclaimed tax refund, then it is important to contact the IRS as soon as possible. You will not be able to get a refund if you do not file taxes within three years. For example, if you have an unclaimed tax refund from 2015, then you will have until 2018 to claim it. The money will become the property of the U.S. Treasury if you do not claim it within three years. Keep in mind that you will not be charged a penalty for filing your tax return late if you are owed a refund.

What to do if you have an Unclaimed tax Refund

If you did not get your tax refund because the IRS does not have the correct address, then you can update your address using the "Where's my Refund?" feature. You will be prompted to give a new address if the IRS was not able to contact you within the past 12 months.

You can also update your address using Form 8862. This is a Change of Address Form, which can be found on the IRS website. You can also call the IRS directly and request a form.

You can also consult with your tax preparer if you have an unissued refund. Your refund may be delayed because the information on your tax refund was not correct. You can update this information by calling the IRS directly.

You can find the forms you need to file your tax returns on the IRS website. You can also get these funds by calling the IRS. Everyone could use an extra $3,116. This is the average unclaimed tax refund amount.

How to Prevent This From Happening in the Future

The main reason that refunds are not delivered is because the IRS does not have people's correct address. That is why it is important to make sure that the IRS has your current address. If you choose to get your refund delivered via direct deposit, then you will need to make sure that the banking information is correct.

Make sure that you keep track of the status of your refund using the "Where's my Refund?" feature. There are three options. Your return is processing, refund has been approved, or it has already been sent. If all of the information is accurate, then you should get your refund within three weeks. However, there are several things that can cause a delay in your refund.

Keep in mind that if your refund is rejected, then you can correct the errors and submit your tax return again. There is no charge for submitting an amended tax return.

Furthermore, you may want to consider e-filing your taxes and signing up for direct deposit. This will not only ensure that your taxes are done correctly, but you will also be able to get your refund much faster.

Small Business Grants

Small Business Grants

August 18, 2016 resourcedepot.co Staff
When starting a small business, you may be wondering if there's any way to request small business grants to assist with the creation of the business in question.

In many cases, this is not possible, as the United States Federal Government rarely awards grants such as these to private businesses that are classified as for-profit. There are some exceptions to this rule. Any business that can be classified as a 501C3 non-profit organization for charitable reasons might very well be eligible for federal grants.

Thankfully, other federal resources are available in lieu of not having access to grants. These resources are primarily available from the United States Small Business Administration. This federal agency is designed to assist Americans with the creation and growth of their small businesses. Their services are available to anyone in America, American Samoa, the U.S. Virgin Islands, Guam and Puerto Rico. The resources available with the SBA include loans, venture capital and surety bonds.

While they don't directly provide small businesses with loans, they guarantee loans to small businesses that directly qualify for a loan by a lending institution. This provides small businesses with a better opportunity and increased chance to actually become eligible for a loan. There are several loan programs to choose from for potential small business owners. The first of these is the Basic 7(a) Loan Program. These loans can be utilized for everything from working capital and leasehold improvements to land/building and furniture/fixtures. Loan maturity is typically around ten years for working capital, but 25 years for fixed assets.

The 504 Loan Program is designed to assist with longer term financing. This financing is set to a fixed rate and is used for everything from purchasing real estate and machinery to equipment for expansion. This type of loan is provided by a Certified Development Company. Liens are placed on any collateral and the borrower is typically required to put in a contribution of around 10 percent equity. A Microloan 7(m) Loan Program is made for smaller financing projects or even technical assistance. These loans are generally short-term and provide up to $35,000 in loans. These loans can be used for supplies, furniture, working capital, inventory and more. It's important to note that the SBA doesn't directly guarantee this type of loan. They can only guarantee the loan to an intermediary who then takes care of the rest.

For any of these loan types, there are some notable qualifications that a small business will need to pass before being granted the loan. For one, if the business owner is submitting an application for a loan of $250,000 or smaller, it needs to be properly analyzed and sanctioned by the SBA beforehand. If the SBA allows it, the loan will then be considered.

Aside from loans, there are also Surety Bond Guarantee Programs to take advantage of. In essence, a surety bond is an insurance that will provide protection in the event that a contractor doesn't successfully complete the project at hand. The SBA assists with the approval of these bonds. The bonds are usually required for any construction grants on a federal, state or city level. If a surety bond isn't obtained, the grant money may not be awarded.

The SBA will also assist with the acquiring of venture capital. Venture capital is basically a cash investment of any amount by private investors as a means of gaining a certain amount of ownership in the new business. The SBA has a specific program that helps any small business in lower income areas with the acquiring of this financing. Such funds can be used for hiring employees in these areas. However, there are several qualifications that a small business must pass in order to make use of venture capital.

For one, the small business can't be worth more than $6 million or have a profit of more than $2 million in the previous two years. The county the business is located in must also have a current poverty rate of 20 percent or higher, or have a metro area where more than 50 percent of residents qualify for the Low Income Housing Tax Credit. If the small business is in a rural area, the median household income must be lower than 80 percent of the median household income for the state.

There is an exception allowed by the SBA with federal grants. The small business requesting a grant must have a focus on innovation research or high technology. The Innovation Research Program offers these funds at the standard development stages. The Technology Transfer Program for small businesses provides grants to companies that partner directly with nonprofit technology institutions that specialize in research. In general, all of the grants available to small businesses can be found in more detail at federalgrants.com.

Take Your Money Out of the Bank!

3 Steps to Never Pay Taxes Again (Yes it’s real and legal)

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What if you could live in a world without taxes? Where each dollar you earn is a dollar you keep. It may surprise you, but thousands of wealthy Americans pay no income taxes. Indeed, the IRS reported in 2011 that about 9,000 taxpayers with incomes over $1 million were able to keep their taxes at zero. It may seem unbelievable, but living a tax free life, or paying minimal income tax, is one of the secrets of the super wealthy. So this post will explain the 3 steps to never pay taxes again.

3 Steps to Never Pay Taxes Again

Wait a second…I thought the only inevitable things in life were death and taxes? You’re telling me that only death is inevitable now?!?! How is this so? The esteemed USC law professor Edward J. McCaffery calls it “Tax Planning 101—Buy, Borrow, and Die.” Read on to find out how it works.

Step One: Buying

The first step to living tax free is to buy an asset that rises in value without producing cash, such as growth stocks or real estate.
Many investors will borrow during this step as well in order to get the most bang for their buck. Smart debt is the best kept secret of the wealthy. As odd as it may seem, the tax code is designed to support American indebtedness. There is no federal tax on consumption or borrowed money. There are even many deductions for paying off loan interest, such as mortgage interest or business-related debt interest.
The wealthy use smart debt to leverage their investments and use the income from their investments (e.g. rental income) to pay off loan interest, principal, and any operating expenses. Because paying off principal is not a deductible business expense, smart taxpayers receive depreciation deductions to eliminate taxable income.
Using this strategy, the asset is paying off its own principal and interest while theoretically appreciating in value. Since you are the owner of the property, all the appreciation belongs to you, not the bank. For instance, take this simplified example: let’s say you own a $1 million property with $200,000 equity and an $800,000 mortgage. Assume the monthly rent covers the principal, interest, and operating expenses. At 3% appreciation and 3% original principal payoff, your equity grows by $54,000 that year. That is a 27% return on investment.

Step Two: Borrowing

When the principal of the debt is sufficiently paid off, the taxpayer refinances the loan. He or she will receive another loan for the property, and the terms of that loan will be based on the appreciated value of the property. The new loan will be used to pay off the remaining debt—the rest can land in the taxpayer’s pocket.
This refinance payment is still a loan, so it is tax free. The taxpayer can use that money for leisure and living expenses as the income from the property (e.g. rent) begins paying off the new loan to re-start the cycle.
For another example, let’s continue with the 3% appreciation and original principal payoff after 5 years. Assume the taxpayer refinances with the same interest rate. In 5 years, there has been $159,274 in appreciation and $120,000 in paid-off principal. If you keep the 20% equity, 80% debt financing, the bank will issue a new loan worth $927,419. Subtract your previous balance of $680,000 and you find $247,419 in your pocket. Tax free. That’s about $50,000 a year.

Step 3: Kicking the Bucket

Can this go on forever? The short answer: yes, but you will be long gone.
As the taxpayer continues to take depreciation deductions, the basis of the property will reduce proportionally each year and ultimately reach zero. With zero basis in the asset, the taxpayer can take no more deductions and if he or she were to sell the property, outside of a 1031 exchange, she would be taxed on every penny, not just the profit.
But, death brings sweet tax-relief because assets that are willed to heirs receive a new, “step-up” basis. The new basis will be stepped up to the fair market value of the asset at the time of death. So even though the taxpayer used up the entire basis and the asset is worth several times what it was originally purchased for, the heirs of the taxpayer can start the cycle over with a fresh new start for tax purposes. If an heir were to receive the asset and sell it that same day, it could be done tax-free.

Conclusion

Note that this is a simplified account of the process. Handling these properties is a business, and there will be complications, as with any business. Changes in the market, accidents on the property, or a plethora of other unfortunate events could complicate things or lead to additional expenses.
You would be wise to consult with a qualified accountant and real estate attorney before jumping into the process, as there will inevitably be legal and tax consequences that you may be failing to consider, such as which entity to use for a real estate investment.
That said, these were rather conservative numbers. Many professional investors can secure loans with even higher leverage than 80%, some as far as 5%. Changing your equity stake from 20% to 5% could effectively quadruple your return on investment.
Further, the assumed 3% principal repayment was lower than even a highly conservative 30 year repayment plan, which is 3.33% average annual principal repayment. Most investments repay the principal significantly faster.