Understanding these rules for who does and doesn’t qualify as a dependent is critical. Your tax liability can change drastically, depending on whom you care for, which is especially important for larger families or those who care for aging relatives. Let’s break down who exactly qualifies as a dependent, how to claim them on your tax return, and the challenges involved with it all. Qualifying Children A qualifying child must meet the following criteria:...
Some common examples of accounts that can be flagged as dormant accounts include: Checking accounts Savings accounts Money market accounts Certificates of deposit (CDs) Investment accounts But dormant accounts can also include other types of “property” such as: Safety deposit boxes Uncashed checks and money orders Life insurance payments Annuity contracts Tax refunds In California, Connecticut, and Illinois, most bank accounts go dormant after three years. In Delaware, Georgia, and Wisconsin, it’s five years....
How Does Dual Agency Work? Dual agency occurs when one real estate agent or brokerage represents both the buyer and seller of a home. This arrangement is beneficial to the agency, because it receives a fee from both sides of the transaction, depending on state laws and practices. Dual agency is legal in most states, but it is heavily regulated to protect buyers and sellers from predatory practices. For example, Alabama requires both buyer and seller consent to be represented by one agent or agency....
For example, a real estate finder’s fee may be defined as “any compensation or commission directly or indirectly imposed by a broker and paid by or on behalf of the borrower for the broker’s services in procuring, arranging, or otherwise assisting a borrower in obtaining a loan or advance of money,” according to the State of Maryland’s commissioner of financial regulation. In business settings, a finder’s fee may be called a referral fee....
When you’re short on cash and need additional financial help, your first thought may be to ask someone you know for a friendly loan. Before you consider asking someone for a friendly loan, it’s important to understand how it works, the pros and cons, and the ways to avoid any pitfalls. Definition and Examples of a Friendly Loan A friendly loan is usually an unwritten financial agreement in which money is borrowed from a friend or family member with the promise it will be paid back....
There are no exact criteria for when a loan is leveraged, and no regulatory agency has specifically defined what type of loan constitutes a leveraged loan. Individual lenders establish their own policy for when a loan is considered leveraged. Lenders typically consider the overall risk of each borrower, the cost of the loan, and the amount of debt the borrower has. For example, a leveraged loan could be made by a bank to a low-rated corporate borrower whose debt is five times its earnings....
That post office box is your electric company’s lockbox. It’s a special P.O. box to which customers can send payments. The bank then collects those payments, deposits the cash, and updates the company on the transactions. How Lockbox Payments Work A company can use more than one lockbox, perhaps one in each region of the country in which it does business. Customer payments can be mailed to the closest lockbox instead of across the country, which decreases mail time and speeds up the company’s access to its funds....
Industry Description Give a brief description (one or two paragraphs) of the industry your business is in, according to the U.S. Department of Labor. Determining your industry is essential for receiving government contracts, attracting investors, and for receiving grants if you form a nonprofit. For example, Fictitious Business Example (FBE) is being established to produce and provide quality industrial first aid kits to the U.S. Government and both private and public companies to improve worker safety on the job....
Since a negotiable CD is guaranteed by a bank, it can be traded in a highly liquid secondary market. You can’t, however, redeem the CD before it reaches its maturity date. Alternate name: Jumbo CD For example, if you had $100,000 in your savings account you could use it to open a negotiable CD and earn an interest rate for a specific period of time, such as six months. After the six months were up, you could withdraw your money and put it back in your bank account....
Before a taxpayer receives a formal notice of deficiency, the IRS needs to determine a need for the notice and also notify the taxpayer. The IRS will start the process if: The IRS believes a taxpayer owes more tax than the taxpayer reported on their tax return. If a taxpayer does not file a tax return and the IRS determines the taxpayer nevertheless has a tax liability. If one of the above factors is determined to be true, the IRS will begin sending letters and notices to the taxpayer....
An employee who receives a pension typically gets a set amount of money every mont, for the rest of their life. How a Pension Works A formula determines how much pension income you will receive once you are retired. The formula that a pension plan uses is typically based on the following factors: Your years of service with the companyYour ageYour compensation For example, a pension plan might offer a monthly benefit of 50% of your pay (based on an average of your pay over your last three years of service) if you retire at age 55 and have at least 10 years of service....
Principal protection can also be referred to as capital guarantee, absolute return, or minimum return. These terms mean your investment is protected from market-related losses. These notes will usually pay a market-linked return. Alternate name: Structured note with principal protection When an investment has a market-linked return, this means that it has a return linked to the performance of additional assets. These investments tend to come with fixed terms. PPNs offer a full or partial return of principal at the date of their maturity....
Alternate name: cash price You’ll likely hear about spot prices if you’re trading commodities, which are physical goods like gold and silver, oil, wheat, or lumber. Commodities trade on both the spot market, which is the market for immediate delivery, and the futures market, which is the market for future delivery. In commodity trading, the seller makes a legal commitment to deliver an agreed-upon quantity of the commodity on a certain date at a specified price....
Alternate name: Fronting facilities Swingline loans provide quick access to capital in urgent situations. A business owner, for example, needs to make a loan installment but is waiting for payment from an outstanding invoice. A swingline loan can offer financial relief until the invoice is paid. How Swingline Loans Work Swingline loans are available in generous amounts and are typically used for debt obligations, such as settling outstanding loans. Swingline loans can be used for working capital, new facility expenses, and other business purposes, too....
The cost of preparing your tax return will most likely be deducted from the amount you receive if you get the loan through a tax preparation service. Other service and administrative fees may be added on as well. There’s generally no credit check involved because the lender will have a dedicated account set up to receive your refund from the IRS and pay off the loan. Your loan is paid off when the refund is received....
Visa is one of four major credit card networks in the United States, along with MasterCard, Discover, and American Express. The company creates credit card products that banks and financial institutions can offer to consumers and facilitates transactions made with those cards. Learn more about Visa credit cards and how, as a driver of payment technology, Visa has played a major role in the way credit cards are used....
Z-scores help you evaluate how normal an observation is for a given data set. You might see a result without knowing if it is high, low, or somewhere near the average. With a Z-score, you can quickly gain more insight. Investors have adapted the Z-score to attempt to understand the financial health of a company. For example, the Altman Z-score is designed to predict how likely a company is to declare bankruptcy....
Calculating your adjusted basis in an asset begins with its original purchase price. The higher your basis, the less you’ll pay in capital gains tax when you sell. Some adjustments can increase your basis in an asset, while others can reduce it, and the latter generally is not a good thing at tax time. You can increase your basis from there by adding the amount of money you’ve spent improving the asset, as well as any amounts you might have paid for legal fees or the costs of sale....
For individuals, assets include checking and savings accounts, retirement accounts, equity in a home or other property, vehicles, and any equity a person has in a business, private or otherwise. In a personal and business sense, assets are a key component of financial stability. Assets are reported on a company’s balance sheet, and are part of the elemental accounting equation: Assets = Liabilities + Equity When they are listed on a company balance sheet, assets are divided into two main categories: current assets and fixed assets....
The most common application for an embossed card is a credit or debit card. Many credit card issuers still use embossing for the account number, name, and expiration date, though this information can also be printed on the card. How Does an Embossed Card Work? Embossed cards have been around since 1928. In the past, merchants would use them to make copies of the customer’s account information with a mechanical imprinting device....
