Come the the 2010 Annual Meeting!

Take Advantage of the Homeowner Tax Credit Extension

Now is the time to take advantage of the homeowner tax credit extension. On November 6, 2009, President Obama signed the Worker, Homeownership, and Business Assistance Act of 2009 to provide an opportunity to claim money if you become a new homeowner.

The new legislation:

• Extends the tax credit of up to $8,000 or 10% of the price of the residence for first-time buyers until April 30, 2010
• Increases income restrictions to $125,000 for individuals and up to $225,000 for joint filers, for residences that cost $800,000 or less.

The new legislation benefits those in the military by eliminating the 36-month recapture requirement for members of the military who've had to sell their homes due to extended stays for service. In addition, military families have at least two more years to take advantage of the credit. The new deadline for them is April 30, 2011.

Not new to owning a home? A tax credit is available for you as well. If you've been living in the same residence for five consecutive years over the past eight years, you are eligible to receive a $6,500 tax credit.

To obtain the credit, you must be at least 18 years old or married to someone at least 18. To avoid fraudulent claims, you must attach a copy of the settlement statements to the tax return. You may not use the tax credit to buy a house from a family member or a spouse's family member.

'What, I can't deduct that?'

There's no lack of tax-time publicity covering deductions for home and car buyers, individual retirement account (IRA) contributions, and even energy-efficient furnaces.

With all the coverage, you might think you can write off almost any expense. Not so. Here's a list of 10 common nondeductible items that just beg for trouble with the Internal Revenue Service (walletpop.com March 9):

1. Gambling losses. Tax law is on the side of Lady Luck. Gambling winnings are taxable, but if you don't have any winnings, you can't deduct losses. If you lose more than you win, you can't claim the excess.
2. Child support. Court-ordered alimony, or spousal support, is deductible. Child support is not. However, you may be able to deduct child-related expenses such as child care (irs.gov).
3. Roth IRA contributions. Many people make an IRA contribution by April 15 for that last-minute deduction. It doesn't work that way for a Roth IRA. With a Roth IRA you can withdraw tax free; you can't deduct contributions. With a traditional IRA, withdrawals are taxed.
4. Job change expenses.You can deduct expenses that help you maintain or improve your job performance, or are required by your employer or by law to keep your salary, status or job. Expenses that will help you qualify for - or find - a new job don't count.
5. Commuting costs. The expense of getting to and from work isn't a valid deduction. But you can deduct car-related expenses while on the job, such as traveling from one site to another, visiting customers or vendors, or attending business meetings off-site.
6. Personal legal expenses. Writing a check to defend a homeowner lawsuit or to recover losses from an accident seems like it should be deductible, but it's not. Legal fees for personal actions aren't a tax write-off. There's an exception for individual taxpayers using attorney services related to obtaining tax advice.
7. Hobby losses that exceed hobby income. You may make a nice side income selling your homemade crafts on Etsy. If so, you'll need to report income on your tax return. You can report expenses, but only to the extent that you have income.
8. Your time. When you volunteer for a charity, your reward is service and that warm fuzzy feeling. There's no tax deduction, even if the value of your time is easy to ascertain, say, for a therapist or lawyer who bills by the hour. The good news is, you may deduct certain out-of-pocket expenses such as mileage.
9. Weight loss programs and health club memberships. The only way you can take this deduction is as a treatment for a specific disease diagnosed by a physician, along with an order for the treatment that lists a weight-loss program and gym membership. And then, the deduction only applies if the cost exceeds 7.5% of your adjusted gross income (irs.gov).
10. Home repairs. Unless your repair is the result of a federally declared disaster or loss from damage from unusual events like a flood, fire, or earthquake, you generally can't take a deduction. Casualty losses have tax relief, but that's not how you want to save on the tax bill.

Five signs 'census taker' is a crook

The 2010 census officially gets under way this week--most forms arrive in mailboxes today through Wednesday. But expect con artists to exploit this once-every-10-years event by getting you to let your guard down and divulge personal information to impersonators (AZCentral.com March 3).

Legitimate census workers go door-to-door from the end of April to July to capture information from households that fail to mail back the form. Crooks know this and will attempt to collect information from you that's not required by the census--personal information that could lead to identity theft.

Take the census seriously, fill out the form, and mail it back. But don't get taken by impersonators with smooth tactics. Know the five signs that point to a census scam:

1. "Please verify your Social Security number." Legitimate census takers don't ask for this. In fact, there are just 10 simple questions on the form—that's it. And a question about your Social Security number isn't one of them.
2. "We need your credit union or bank account number." No, they don't. None of the census' 10 questions asks for financial data (MarketWatch.com Feb. 27). And the Census Bureau will never ask you for your PIN, passwords, or similar access information for credit cards or financial accounts.
3. "Please fill out your census form by replying to this e-mail or visiting this website." That's a sure sign it's a scam, because the Census Bureau never will contact you by e-mail or ask you to answer questions on a website.
4. "Of course I'm a census taker--you know about the census, right?" Legitimate census takers carry official badges and will give you the phone number of the local Census Bureau office so you can verify identities. To be safe, find your regional census office phone number at Census.gov/regions and call to verify identities.
5. "In cooperation with the census, we're asking for donations to a local charity." Legitimate census takers don't collect money for charities or political parties, according to the Census Bureau.

If you think you've been a victim of a census scam, contact your regional Census Bureau office immediately. Don't reply to suspicious e-mails or click on links within e-mails that portend to be from the Census Bureau. Instead, forward the e-mail or website URL to ITSO.Fraud.Reporting@census.gov. Then delete the message. The Census Bureau will investigate and notify you of its findings.

Fed details credit card law changes

Most consumers are aware that credit card laws changed recently - that's a good thing. Unfortunately, more than half (65%) don't know the specifics, according to a January survey by the Consumer Federation of America and Credit Union National Association.

To help consumers comprehend the new credit card protections, the Federal Reserve launched an interactive website in late February. Consumer's Guide to Credit Cards explains credit protection laws and more.

In addition to running through key changes of the Credit Card Accountability Responsibility and Disclosure (CARD) Act in English and Spanish, the site offers:

• A guide to the interest rates, charges, and fees section of credit card offers, with rollover interpretations of a sample offer;
• Sample credit card statement, with rollover definitions;
• Repayment calculator;
• Video with five tips on using credit cards wisely; and
• Glossary of common credit card terms.

Consumers will find valuable guidance--almost hidden on the site--under "5 Tips for Getting the Most From Your Credit Card." The tips, succinctly put, are:

1. Pay on time;
2. Stay below your credit limit;
3. Avoid unnecessary fees;
4. Pay more than the minimum; and
5. Watch for changes in the terms of your account.

This last point is essential. Since the first phase of CARD Act protections in 2009, large banks that issue cards have been adjusting terms to maintain profits. With the second phase of protections now in force, be alert for new fees and more rate changes. Better yet, instead of waiting, compare bank card terms with a credit union credit card. Since your credit union is a not-for-profit financial institution, any gain on credit cards is returned to members in the form of lower loan rates and better savings rates.

Steer clear of sneaky work-at-home schemes

The Better Business Bureau has been receiving thousands of complaints from victims of a work-at-home scheme that has fooled even savvy consumers. Google Money Tree promises extra income from using home computers, but first you have to spend a small amount of money upfront—usually $1 to $4—for a kit to get started. Once you hand over your account information, you'll be hit with a monthly recurring membership charge of $72.

Protect yourself from sneaky work-at-home schemes:

* Research the company before you sign up. Do an Internet search and check with the Better Business Bureau.
* Watch for red flags, such as upfront out-of-pocket costs.
* Be cautious: You shouldn't have to pay for the privilege of being interviewed for a job.
* Don't respond to unsolicited e-mail messages or vague job descriptions.
* Turn the other way If the position involves depositing a check from the company into your account, keeping some of that money for yourself, and wiring the rest to other sources.

Never give personal account information to strangers. In the case of Google Money Tree, that's how victims got hit with recurring monthly charges.

Don't get hooked by tax scams

If Benjamin Franklin were alive today, he might amend his famous dictum, "'In this world nothing can be said to be certain, except death, taxes, and insidious attempts to cheat you via e-mail."

One of the most popular online cons is "phishing," the request for personal information from an apparently legitimate source. This is the time of year when scammers often use the authoritative name of the Internal Revenue Service (IRS) to collect financial details from careless victims.

The Credit Union National Association's Center for Personal Finance offers this advice to avoid taking the "IRS phishing" bait:

• Do not respond to e-mail that purports to come from the IRS. Do not reply, click on links, or open attachments from someone claiming to represent the IRS or directing you to an IRS site. The Internal Revenue Service does not ask for passwords or other details about your credit union or bank accounts via e-mail--nor do those financial institutions.
• Report suspicious e-mails to the IRS. Don't fall for fake Treasury Department or IRS logos or a tone of urgency. You can see samples of phishing attempts at the IRS website (www.irs.gov), which also includes instructions for forwarding bogus e-mails.
• Teach your children to protect their personal information. Young Internet users often take online communications at face value. A healthy skepticism about the Web has become a basic consumer protection skill, and parents can find opportunities to instill it in their children.

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