The Tax Effects of Student Loan Forgiveness

With college tuition fees continuing to outperform inflation, college students are starting to rely more greatly on college loans to pay for their education, with most students leaving college with at least $30,000 of student loan debt. However at the end of the day the interest you pay on these loans are a write-off. And you don’t even need to itemize these deductions to write-off the interest, you can simply use the adjustment to income on Line 33 of Form 1040, which will reduce your overall taxable income.

Of course like everything else the government has their hands in there are certain requirements for you to take this write-off or we should say the deduction for instance;

  1. You cannot take the write-off/deduction if you are married but filing separately;
  2. No one else can claim you as an exemption on his or her income tax return;
  3. You are legally obligated to pay interest on a qualified student loan;
  4. You paid the interest on the qualified student loan.

These IRS rules get much more complicated as your circumstances change, such as losing your job and you can’t make your payments.

If this happens to you your lender may decide to let you off the hook for the loan balance and if so then you would have to pay income taxes on it. Obviously, if you file bankruptcy or you can prove ruin, you probably could exclude it from your income, but unfortunately it doesn’t always work.

Earlier this year, the Pay as You Earn Program began to give an estimated additional 5 million borrowers who have owed on student loans for 20 years or more and demonstrated good repayment habits a break on repayment if they are currently underwater. This is debt that will be charged off resulting in potential tax problems for the debtors.

With the total level of outstanding student debt topping $1 trillion, the balances being discharged can be huge, which may result in a tax liability well into the thousands of dollars.

On July 29, Reps. Frederica Wilson, (D-FL), and Mark Pocan, (D-WI), both members of the House Education and Workforce Committee, introduced the Relief for Underwater Student Borrowers Act. This bill would allow student loan borrowers who have been granted debt relief as a result of consistent repayment towards their student loan debt an exemption from being taxed on the amount forgiven.

This is good news for student loan borrowers. If they can’t repay the loans, they likely would be unable to pay off the tax liability generated by the discharge of the debt.

According to a statement by on Wilson’s website, “As a member of the Subcommittee on Higher Education and Workforce Training, college affordability is one of my top priorities. Today, student debt is at a record high, with individual debt forcing many people to put off major purchases such as buying a home or automobile… This bill prevents student loan borrowers from being hit with an additional tax burden for debt that has been forgiven after 20 years of consistent repayment, and in the event of suffering a total permanent disability or death, this bill prevents the debt forgiven from being considered taxable income. The Relief for Underwater Student Borrowers Act helps individual borrowers and their families, as well as strengthens the economy.”

We found a lot of information on this subject at www.helpwithmystudentloan.com and suggest you read about the many options available to you.

Conquering Anxiety: Top Tips To Master Your Fears

stress-ballUnfortunately, mental health problems aren’t taken as seriously as physical health problems, by everyday folks. Many people, for example, are unable to comprehend how much of an impact severe anxiety can have on a person’s life. Fortunately, the authors of this article understand how debilitating anxiety can be and in this article, you will find a collection of some of the best anxiety-busting tips on the web.

If you are experiencing a serious anxiety, or panic attack, you should remember to breathe properly in order to calm down. We need to remember that our bodies are like machines, and taking proper breaths is what fuels them properly. Remember, to lengthen your exhalation, in order to relieve your anxiety a bit more.

Think happy thoughts. If you have problems falling asleep at night because of anxiety, think about everything good in your life and the positive things you are going to do the next day. While it may seem hard to do at first, the more you do it, the more you will get used to it.

Staying active with exercise of some kind will help to burn off energy that your body would put to use to feed your anxiety. Get out for a walk, take a swim or take up aerobics or yoga for positive physical activity. Anything that will feel good as you do it and burn energy is going to help alleviate your anxiety.

When you are on anxiety medication, never stop taking it without talking to your doctor. Even if you feel like you are better, you still cannot just stop. Some of these medications can make you very ill and can even be deadly if you just stop all of a sudden.

If you have been prescribed medication for anxiety, be sure that you take it at the same time every day. You can put your bottle by your toothbrush in the cabinet, or just wherever you will notice it. Remember that some medications take a while to work, so you have to take it every day.

You need to know how to accept uncertain situations. If you worry about everything, your life will still be unpredictable. All it does is keep you focused on the uncertainty and then you miss out on the great things that are right in front of you. Accepting uncertainty and avoiding the need for instant solutions can better your life.

Laughter can really help you during the course of the day. If you work or go to school, you will face a lot of stressful situations that require you to put things in perspective. Laughter helps you to control your mood, so that you can stay positive, all day long.

Begin a journal, and every day, write down at least one thing positive in your life. Then, whenever your anxiety begins to bother you, open and read your journal. This will remind you of all the good things you have in life and help keep your anxiety to a minimum.

It may sound funny, but doing silly things, like dancing around during a panic attack or slapping your face, can distract your thoughts. If you can laugh and relax, then you can stop anxiety from growing. Do whatever is needed in order to get out of this predicament.

Try consuming less alcohol or tobacco. Despite the common belief that these substances are relaxing, they aren’t. In fact, they usually cause more anxiety than you had before. Turn to healthier alternatives like partaking in healthy social activities, using relaxation techniques or even by eating a healthy diet.

What is the one thing that will ultimately keep anxiety away from you for good? As far as anxiety goes, laughing and smiling can go a long way. Find something to be happy and thankful for. If you’re having trouble and feel anxiety, laughing about things can really help. This can be a comedy show or maybe a funny song.

Volunteer in your community. Finding something that really makes you feel good about doing it, will have a very positive impact in your life. The happier you are, the less anxious you will feel. You could work at a homeless shelter, read to kids at the library, or work at an animal shelter. Whatever makes you feel the best will help you the most.

If you start to have an anxiety attack while you are trying to sleep, respond immediately. It’s helpful to get up and move around, eat a light snack, watch tv or get a drink of water. Be sure you’re constantly moving so you’re able to rid yourself of the anxiety quicker. This will allow you to return to bed and get better sleep more quickly.

As aforementioned, many people are unaware of how debilitating severe anxiety can be. Hopefully, if you suffer from anxiety, the collection of tips included in this article will help you to reduce the severity of some of the symptoms of your condition. Perhaps, it would even be a good idea to keep a copy of this article handy, so that you can refer to it, in times of need.

What You Need To Know About Investing In Real Estate

investingThere are many ways to make money in real estate. However, most individuals do not know how to do it. There are things you may have been searching for to help with your success in real estate, and these are things you should know. Continue reading to see what they are.

Remember that there are always more fish in the sea. It is easy to get your heart set on a certain property or deal. However, if that one deal takes too much time and effort, it is not really a deal in the first place. Move on and make sure you do not miss out on the other great investments out there.

Don’t invest in real estate without educating yourself first. It’s crucial to learn as much as you can before you delve into the real estate world. Read more information in books and watch seminars and videos on real estate investing so you gain the upper edge.

Know what the property’s value in the neighborhood is. Finding out who the neighbors are and whether they rent or own can provide an idea of the neighborhood. It’s easier to make a good decision if you look at things from the street level.

Location is a vital aspect of real estate investing. Property conditions and other issues can be fixed. Properties that are in areas that are depreciating fast will generally make a bad investment choice. Investigate the neighborhood before investing money in it.

Build a strong team that is going to work with you during the whole process. This means that you will need to get a realtor, accountant and lawyer that will help safeguard you in case anything goes wrong in the process. These people will also give you great advice while you invest.

Don’t buy extremely cheap properties. You want to look at factors, such as if other homes are selling in the area quickly or not. Invest what you have to into something of value that is more likely to return your investment.

If you purchase a property with the intention of renting it out, be careful of who you sign on as a tenant. They should pay a deposit and the first month’s rent early on. If they can’t, they aren’t a reliable bet for you. Keep looking for a better tenant.

Consider using a property management company. Even though you have to pay for it, the services are worth your investment. The company screens renters for you and handles repairs. This will help save you quite a bit of time so that you can work on other avenues for investment.

Seek out new clients by contacting a title company. Ask for a list of the buyers in your area who have purchased homes similar to the type you seek. In this way, you can let them know of your interest in investing before they have even thought of reselling. Being acquainted in advance gives you an edge.

Knowing how to make smart investments is crucial. It is unwise to dive in without the right knowledge. In this article, we have provided basic information about real estate investing. Study the market as often as possible to maximize earnings.

Build Your Retirement Nest Egg With These Top Tips And Advice

Some people think about their retirement early in life. Retirement should be a time to sit back and enjoy your hard work. You need excellent retirement planning to manifest these goals. This article will help you with the planning process.

Either start saving or keep on saving. If you aren’t saving already, then it’s due time that you started. You can never really begin saving too early for retirement. If you are already saving, then good job, but you can’t slack off as time goes on. Keep saving and don’t give up.

Most people look forward to their retirement, especially after they have been working for several years. They believe retirement will be a wonderful time when they can do things they could not during their working years. While this is somewhat true, it takes careful planning to live the retired life you had planned.

If your company offers you a 401K plan, contribute as much as you can to it, up to its maximum. This is a great way to save for your retirement. All you need to to do is to contact your HR department, and funds will be deducted from your paycheck automatically each month and deposited into your 401K account.

When planning for retirement, create savings goals and stick to them. If you’ve already started saving, keep at it! If you haven’t started, create small goals and make sure to meet them every month. Make saving a priority. Once you have met your goals, slowly increase them as you go along.

Make realistic plans and set realistic goals for your retirement. Don’t set your sights unrealistically high, and be honest about how much you are going to need to maintain your standard of living. Sit down and plan a budget for yourself. Based on that, determine how much you will need before you can retire.

To save money you will need later on, think about downsizing as you near retirement. Even if you think everything is planned perfectly, life can happen. Unexpected medical bills or other expenses can be challenging to deal with on a fixed income.

Look into the pension plans offered by your company. Learn all of the details for these plans. Determine how you are affected if you move jobs. Find out if you can get any benefits from your previous employer. Your spouse’s pension program may also offer you eligibility.

Never spend your retirement money. Pulling money from your retirement fund not only reduces the amount of money you have for retirement, but it also increases your tax burden. You will also be responsible for early withdrawal penalties, tax liabilities and lose interest from the amount withdrawn from your retirement fund.

Make sure that you know what you are going to do for health insurance. Healthcare can really take a toll on your finances. Make sure that you have your health expenses accounted for when you retire. If you retire early, you may not qualify for Medicare. It’s important to have a plan.

Leave your retirement savings alone. Taking money out will hurt you in more ways than one. You will lose out on interest, for one thing. In addition, you could have to pay a withdrawal penalty. If you are switching jobs, either leave the money where it is or bring it over to an IRA.

Have a plan for traveling during retirement, or you’re probably going to regret it! Traveling is one of the most enjoyable ways to spend your time, but it gets awfully expensive. Have a financial plan that allows you to see the sights you’ve always wanted, and avoid going overboard. You don’t want to come home to an empty bank account!

As you approach the age of retirement, find out about Medicare. This important part of life after working is something you need to know about now. There are deadlines for signing up and serious choices to be made. Be aware of your options and obligations now, to avoid missing out on necessary benefits later.

You can have fun and enjoy your retirement years. This piece has provided some good tips for doing precisely that. It is important that you get started now, as your retirement will be here before you realize it. Good luck and enjoy yourself!