Tips to Help Taxpayers Spot and Avoid Scams

Tax season is also busy season for criminals. Scammers impersonating the IRS either over-the-phone, by email or in-person can steal money from people. All taxpayers should stay vigilant against these schemes.

Here are some tips to help people recognize and avoid tax-related scams.

Email phishing scams

The IRS does not initiate contact with taxpayers by email to request personal or financial information. Generally, the IRS first mails a paper bill to a person who owes taxes. In some special situations, the IRS will call or come to a home or business.

Taxpayers should report IRS, Treasury or tax-related suspicious online or email phishing scams to phishing@irs.gov. They should not open any attachments, click on any links, reply to the sender, or take any other actions that could put them at risk.

Phone scams

The IRS generally first mails a bill to a taxpayer who owes taxes. There are specific ways to pay taxes. The agency and its authorized private collection agencies will not:

• Leave pre-recorded, urgent, or threatening messages on an answering system.
• Threaten to immediately bring in local police or other law enforcement groups to arrest the taxpayer for not paying, deport them or revoke their licenses.
• Call to demand immediate payment with a prepaid debit card, gift card or wire transfer.
• Ask for checks to third parties.
• Demand payment without giving the taxpayer an opportunity to question or appeal the amount owed.

Criminals can fake or spoof caller ID numbers to appear to be anywhere in the country. Scammers can even spoof an IRS office phone number or the numbers of various local, state, federal or tribal government agencies.

If a taxpayer receives an IRS or Treasury-related phone call, but doesn't owe taxes and has no reason to think they do, they should:

• Not give out any information. Hang up immediately.
• Report the caller ID and callback number to the IRS by sending it to phishing@irs.gov. The subject line should include "IRS Phone Scam."

If a taxpayer wants to verify what taxes they owe the IRS, they should:

• View tax account information online at IRS.gov.
• Review their payment options.

Questions about this week's tax tip? We can help!

 

www.PadgettToledo.com

Source: Padgett Business Services

Tax Benefits You May Be Entitled To

1. First time homebuyers save your tax refund for a down payment.

2. PMI might be tax deductible.

3. Mortgage interest paid might be tax deductible.

4. Real Estate Taxes paid on primary residence might be able to be itemized on a tax return.

5. What interest rate are you paying on your current mortgage and contact your loan officer for refinance benefits.

6. Do you have a lot of high interest rate credit cards that can be consolidated into a low rate refinance?

   Source: Ruoff Mortgage 

Selling Your Home This Spring? Take Care of These 10 Things Now!

Selling Your Home This Spring? Take Care of These 10 Things Now!

What is Credit and Why Do I Need It?

The term “credit” can be defined as money, goods, or services given with the expectation of future repayment. Typically, credit is offered under specific terms in the form of a contract. Those terms include the amount of credit (the loan) when it is initially offered and/or disbursed, the full amount to be repaid (initial offering plus interest) and the frequency and timing of the repayment. Credit can be as big as a mortgage or as small as contracting with a neighbor to mow your lawn weekly and promising repayment at the end of the month.

If you want or need something now but don’t have enough cash to cover the cost, you need credit. If you want or need something now but prefer to build savings or to leverage your money for another investment, you need credit. Credit isn't inherently good or bad, but it is something you should learn to master.

Start Small

If you establish good credit early in your financial journey, lending institutions are likely to view you as a favorable risk. This means you’re more likely to be offered loans at higher amounts and with the lowest interest rates available.

There are many ways to start building good credit. You could open a basic credit card account with a small spending limit, then make a purchase or two each month. Start with a small amount that you will repay in full each billing cycle. If you do this for at least twelve months, then banks and other lending institutions are more likely to approve you for a loan in the future. The most important takeaway here is to pay off your credit card in full each month.

A second method for building credit is to establish a good payment history with your landlord. When you apply for your first mortgage, the underwriter will request a rental history. In the absence of a long credit history, your rental history will weigh heavily on the underwriter’s risk assessment.

Avoid Rookie Mistakes

1. Avoid credit blunders that happen early in adult life (such as bankruptcy or auto repossession). These will show up on your credit report long after the end of the legal proceedings. Of course, mistakes like these could happen during any phase of life, but they are especially damaging to one’s credit profile when good credit has not yet been established.

2. Start on the right foot and don’t overcommit. According to investment guru Dave Ramsey, “We buy things we can’t afford with money we don’t have to impress people we don’t like.” This unfortunate but common adage doesn’t have to apply to you.

3. Resist the temptation to overextend your finances. Delaying gratification now will pay off big in the future. It's recommended to use under 30% of the credit on your card. Maxing out your cards is bad news!

Credit Score Tip

Keep your oldest account (assuming it’s in good standing). If you have an old credit card or open-ended loan on your credit report, consider keeping it open and making a small purchase once or twice a year. Then, pay off the full balance within 30 days of each purchase. All other factors held constant, the credit repositories (Equifax, Experian, and TransUnion) give higher scores to longer credit histories versus shorter ones. To see all five factors involved in determining your credit score, take a look at this article. 

The Cosigner Controversy

A cosigner is simply a joint signer on a loan, promissory note, or another debt instrument. Cosigning can make a loan package more attractive from an underwriting perspective because it often leads to a lower risk assessment. A typical example would be when a parent cosigns on an auto loan for their teenage child. This can help the younger party build credit if the parent has established credit and is willing to become a party to the loan. The downside to cosigning is that the established party, who may or may not have any legal interest in the collateral (the car, house, or whatever is being purchased), is still on the hook if the primary signer fails to repay. Discuss roles and expectations in detail before entering into any cosigning relationship.

A stable society where goods and services are traded every moment relies on credit. It keeps the markets moving. Start small, avoid mistakes, and build a solid credit profile early. Making good choices and delaying gratification now will help tremendously if you want to build a solid financial future.

Source Ruoff Mortgage Newsletter

Prep Your Deck and Patio

Maintenance of Decks and Patios

The summer season can be drying for natural wood decks. Now is the time to take care of any maintenance before the rainy season arrives. Check to see if any repairs are needed, such as split boards, nail heads, and so on.

After repairing, clean and wash your deck thoroughly and re-seal or stain if needed. Water-based products can offer easier cleanup and less odor while oil-based products tend to penetrate deeper and last longer.

If you have a composite deck, follow the manufacturer’s instructions on cleaning. If a deck-wash is recommended, be sure to rinse thoroughly so no residue is left behind.

Concrete patios need care too. Thoroughly clean the surface with mild dish soap and water. If stained, check your local home improvement store for concrete cleaning product recommendations.

Once the surface is clean consider applying the protection of a colored or clear concrete sealer.

Replace or Refresh Accessories and Plantings

Renew your outdoor space for the cooler months by changing out accessories and plants. With fall settling in soon and winter ahead, when it is time to put away a table umbrella, replace it with colorful arrangements of pumpkins and gourds.

Replace summer annuals with hearty seasonal blooms. Some good choices are flowering cabbage and kale, ornamental grasses, pansies, and chrysanthemums. Add containers and decorative potswith shrubs like English holly, boxwood, and dwarf evergreens to carry into the frosty winter season.

Create an Inviting Outdoor Space

Firepits and fire tables are a nice focal point for gathering and warmth. Replace weathered or faded cushions with fresh, bold seasonal colors. The right cushions can make the difference in comfort as well as beauty.

If you don’t have the space for a firepit, portable gas heaters come in many sizes, including tabletop.

Use colorful outdoor rugs and weatherproof pillows to bring the indoors out. Keep a basket or storage container nearby with cozy blankets handy for your family, or for guests when entertaining.

In smaller spaces, try creating a conversation area with flameless candles and lanterns. Add outdoor lighting, including strings of LED or battery-powered lights for interest and sparkle.

Think colorful and cozy. A smaller deck or patio can be the most inviting and easiest to maintain and update. Once you’ve created your comfortable outdoor space, fill your favorite mug, grab a cozy blanket, and enjoy the beautiful colors and fresh air of each new season.

Source: First American Home Warranty 

3.8M Homes Are Missing From the Housing Market

Fewer homes are up for sale than historical norms, which is why buyers may become frustrated with house hunting.

There are not enough homes for the population, a new report from realtor.com® warns. The shortage lands at 3.8 million homes nationwide. And the impact could be widespread: Competition among buyers could grow steeper, causing home prices to move higher.

Will the new-home market be able to catch up to demand? “Home builders have a mountain of opportunity, but a big hill to climb,” says Javier Vivas, director of economic research at realtor.com®. “The current inventory crisis and need for 3.8 million new homes means a nearly insatiable appetite from potential buyers, especially in the lower end of the market.”

Between 2012 and 2019, about 5.9 million single-family homes were built. However, during that time, about 9.8 million new households were formed.

Home builders, faced with labor and lot shortages and escalating prices, have started to ramp up their lean inventories over the past year. But levels still remain well below two-decade average lows. Realtor.com® researchers estimate that even with an above-average pace of construction, it would still take builders four to five years to return to equilibrium.

The missing inventory has been most acute in the entry-level and mid-range markets.
"Large populations of renters and well-qualified potential buyers with strong incomes are waiting in the wings,” Vivas says. “Assuming the economy avoids a full-on recession and rates remain low, the window for builders remains wide open. If builders can deliver homes at adequate price points, absorption will continue to strengthen through the first half of the decade.”

Source: 

“Homebuilders Have a Big Hill to Climb but Remain Key to Supply Shortage,” realtor.com® (Jan. 21, 2020)

Single Story Homes Are Gaining Popularity

That single-story home may be more desirable than it once was. The construction of single-story homes is increasing at a more rapid pace than two-story homes, according to new data from the U.S. Census Bureau.

While overall the share of starts of homes of two-plus stories was higher than single-story homes in 2018, the two-story percentage is shrinking while one-story construction is growing. The share of new homes started with two or more stories dropped from 55% in 2017 to 53% in 2018. However, the share of new homes with a single-story increased from 45% to 47%, the data shows.

The growth of single-story homes was most pronounced in the South, the National Association of Home Builders’ analysis of the data shows.

© National Association of Home Builders

A separate report from the real estate brokerage Redfin showed single-story or ranch homes were the most popular home style of home sold last year. The style also tended to be more affordable, they noted.

The preference of a single-story home rises with age, a recent survey of home buyers by the NAHB shows. Eighty percent of baby boomers say they prefer a single-story home so that they can more easily age in place. However, only 35% of millennials say they want a single-story home.

“Homes with one story are more common in non-metro areas, while two or more stories homes are common in metro areas,” the NAHB notes on its blog, Eye on Housing. “However, we experienced an increasing share of one-story homes in both metro and non-metro areas from 2017 to 2018.”
 

Source: 

“Single-Story Home Construction Increased in 2018,” National Association of Home Builders’ Eye on Housing (Sept. 30, 2019)