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Tax lawyers, accountants and financial planners are burning the midnight oil trying to figure out all the ins and outs of the new tax law. The men and women of the IRS, given less than two weeks between the day President Trump signed the law and the time most of the new provisions went into effect January 1, are scrambling, too. When Congress approves the most sweeping changes in the tax law in more than three decades, you can bet you’ll be affected. Here are 17 things you need to know about how the new rules affect retirees and retirement planning. Supersized Standard Deduction The new law nearly doubles the size of the standard deduction – to $12,000 for individuals and $24,000 for married couples who file joint returns in 2018 (up from $6,500 and $13,000). The increase, in conjunction with new limits on some itemized deductions, is expected to lead more than 30 million taxpayers who have itemized in the past to choose the standard deduction instead (because it will reduce their taxable income by more than the total of their deductible expenses). There’s even more incentive for taxpayers age 65 and older to make the switch because their standard deduction will be even bigger. As in the past, those 65 and older or legally blind get to add either $1,300 (married) or $1,600 (single) to the basic amount. For a married couple when both husband and wife are 65 or older, the 2018 standard deduction is $26,500. All the hoopla about doubling the standard deduction is somewhat misleading. As a trade-off, the new law eliminates all personal exemptions. The 2018 exemption was expected to be $4,150, so, for a married couple with no children, the $11,000 hike in the standard deduction comes at a cost of $8,300 in lost exemptions. While this will affect your tax bill, it does not affect the standard deduction/itemizing choice. A Squeeze on State and Local Tax Deductions The new law sets a $10,000 limit on how much you can deduct for state and local income, sales and/or property taxes for any one year. This could be particularly painful for retirees with second homes in the mountains, say, or at the seashore. In the past, property taxes were fully deductible on any number of homes, and there was no dollar limit on write-offs for either state and local income or state and local sales taxes. The new law lumps all so-called SALT (state and local taxes) deductions together and imposes the $10,000 annual limit. This crackdown, along with the increase in the standard deduction, will lead millions of taxpayers to switch from itemizing to claiming the standard deduction. Loss of Deduction for Investment Management Fees Just as one part of government is pushing financial advisers who work with retirement accounts to charge clients set fees rather than commissions, Congress has decided to eliminate the deduction of such investment management fees. In the past, such costs could be deducted as a miscellaneous itemized deduction to the extent all of your qualifying miscellaneous expenses (including fees for tax advice and employee business expenses, for example) exceeded 2% of your adjusted gross income. As part of the tax overhaul, Congress abolished all write-offs subject to the 2% floor. If you’re paying a management fee for a traditional IRA, having it paid from the account itself would effectively allow you to pay it with pre-tax money. 401(k)s Spared A firestorm of criticism blew up last fall when it was learned that the House of Representatives was considering severely limiting the amount or pre-tax salarly retirement savers could contribute to their 401(k) plans. In the end, though, Congress decided to leave 401(k)s alone, at least for now. For 2018, savers under age 50 can contribute up to $18,500 to their 401(k) or similar workplace retirement plan. Older taxpayers can add a $6,000 “catch-up” contribution, bringing their annual limit to $24,500. Stretch IRA Preserved Early on in the tax-reform debate, it appeared that Congress would put an end to the “stretch IRA,” the rule that permits heirs to spread payouts from an inherited IRA over their lifetime. This could allow for years, or even decades, of continued tax-deferred growth inside the tax shelter. One plan that gained traction on Capitol Hill would have forced heirs to clean out inherited IRAs within five years of the original owner’s death. The accelerated payout would have sped up the IRS’s collection of tax on the distributions. Ultimately, though, this plan wound up on the cutting room floor. The stretch IRA is still available as long as the heir properly titles the inherited account and begins distributions, based on his or her life expectancy, by the end of the year following the original owner’s death. Stretch IRA Preserved Early on in the tax-reform debate, it appeared that Congress would put an end to the “stretch IRA,” the rule that permits heirs to spread payouts from an inherited IRA over their lifetime. This could allow for years, or even decades, of continued tax-deferred growth inside the tax shelter. One plan that gained traction on Capitol Hill would have forced heirs to clean out inherited IRAs within five years of the original owner’s death. The accelerated payout would have sped up the IRS’s collection of tax on the distributions. Ultimately, though, this plan wound up on the cutting room floor. The stretch IRA is still available as long as the heir properly titles the inherited account and begins distributions, based on his or her life expectancy, by the end of the year following the original owner’s death. FIFO Gets the Heave-Ho For a while, it looked as if Congress would restrict the flexibility investors have to control the tax bill on their profits. Investors who have purchased stock and mutual fund shares at different times and different prices can choose which shares to sell in order to produce the most favorable tax consequences. You can, for example, direct your broker to sell shares with a high tax basis (basically, what you paid for them) to limit the amount of profit you must report to the IRS or, if the shares have fallen in value, to maximize losses to offset other taxable gains. (Your gain or loss is the difference between your basis and the proceeds of the sale.) This flexibility can be particularly valuable to retirees divesting holdings purchased at different times over decades. The Senate called for eliminating the option to specifically identify shares and instead impose a first-in-first-out (FIFO) rule that would assume the oldest shares were the first to be sold. Because it’s likely that the older shares have a lower tax basis, this change would have triggered the realization of more profit sooner rather than later. In the end, though, this idea fell by the wayside. Investors can continue to specifically identify which shares to sell. As in the past, you need to identify the shares to be sold before the sale and get a written confirmation of your directive from the broker or mutual fund. Do-Overs are Done For The new law will make it riskier to convert a traditional individual retirement account to a Roth. The old rules allowed retirement savers to reverse such a conversion—and eliminate the tax bill—by “recharacterizing” the conversion by October 15 of the following year. That could make sense if, for example, the Roth account lost money. Recharacterizing in such circumstances allowed savers to avoid paying tax on money that had disappeared. Starting in 2018, such do-overs are done for. Conversions are now irreversible. Relief for Some 401(k) Plan Borrowers The new law gives employees who borrow from their 401(k) plans more time to repay the loan if they lose their jobs. Currently, borrowers who leave their jobs are usually required to repay the balance in 60 days to avoid having the outstanding amount treated as a taxable distribution and hit with a 10% penalty if the worker was under age 55. Under the new law, they will have until the due date of their tax return for the year they left the job. End of Home-Equity Loan Interest Deduction Taxpayers who use home-equity lines of credit to get around the law’s general prohibition of deducting interest get bad news from tax reform. The new law puts the kibosh on this deduction . . . immediately. Unlike the restriction of the write-off for home mortgage interest—reducing the maximum amount of debt on which interest is deductible from $1 million to $750,000—which applies only to debt incurred after December 14, 2017, the crackdown on home-equity debt applies to old loans as well as new ones. New Luster for QCDs The new law retains the right of taxpayers age 70 ½ and older to make contributions directly from their IRAs to qualifying charities. These qualified charitable donations count toward the IRA owners’ required minimum distributions, but the payout doesn’t show up in taxable income. As more and more taxpayers claim the standard deduction rather than itemizing, QCDs stand out as a way to continue to get a tax benefit for charitable giving. Taxpayers who qualify and claim the standard deduction may want to increasingly rely on QCDs. Custodial Accounts and the Kiddie Tax If you’re saving for your grandkids, or great grandkids, in custodial accounts, you need to know about changes in the kiddie tax. Under the old law, investment income over a modest amount earned by dependent children under the age of 19 (or 24 if a full-time student) was generally taxed at their parents’ rate, so the tax rate would vary depending on the parents’ income. Starting in 2018, such income will be taxed at the rates that apply to trusts and estates, which are far different than the rates for individuals. The top 37% tax rate in 2018 kicks in at $600,000 for a married couple filing a joint return, for example. That same rate kicks in at $12,500 for trusts and estates . . . and, now, for the kiddie tax, too. But that doesn’t necessarily mean higher taxes for a child’s income. Consider, for example, a situation in which your grandchild has $5,000 of income subject to the kiddie tax and that the parents have taxable income of $150,000. In 2017, applying the parents’ 25% rate to the $5,000 would have cost $1,250. If the old rules still applied, using the parents’ new 22% rate would result in an $1,100 tax on that $5,000 of income. Applying the new trust tax rates produces a kiddie tax bill of $843. The kiddie tax applies to investment income over $2,100 of children under age 19 or, if full-time students, age 24. New Rules for State 529 College Savings Accounts If you’re investing in a college fund for your grandchildren, you need to know about changes in tax-favored 529 plans. The new law expands the use of these savings plans by allowing families to spend up to $10,000 a year to cover the costs of K-12 expenses for a private or religious school. The $10,000 cap applies on a per-pupil basis. Previously, tax-free distributions were limited to college costs. Although 529 contributions are not deductible at the federal level, most states offer residents a break for saving in the accounts. Expanded Medical Expense Deduction While Congress cracked down on a lot of deductions, and the medical expense write-off was once threatened with complete elimination, in the end the lawmakers actually changed the law so that more taxpayers can benefit from this break. Until the new rules became law, unreimbursed medical expenses were deductible only to the extent that they exceeded 10% of adjusted gross income. The high threshold meant that relatively few taxpayers qualified, although retirees with modest incomes and high medical bills frequently did. The new law reduces the threshold to 7.5% of AGI and the more generous rule applies for both 2017 and 2018. In 2019, the threshold goes back to 10%. Tax-Free Income from Consulting Planning to start your own business or do some consulting in the early years of your retirement? If so, one change in the new law could be a real boon. The law slashes the tax rate on regular corporations (sometimes referred to as “C corporations”) from 35% to 21%, starting in 2018. There’s a different kind of relief to individuals who own pass-through entities—such as S corporations, partnerships and LLCs—which pass their income to their owners for tax purposes, as well as sole proprietors who report income on Schedule C of their tax returns. Starting in 2018, many of these taxpayers can deduct 20% of their qualifying income before figuring their tax bill. For a sole proprietor in the 24% bracket, for example, excluding 20% of income from taxation has the same effect of lowering the tax rate to 19.2%. Another way to look at it: If your business qualifies, then 20% of your business income would effectively be tax-free. For many pass-through businesses, the 20% deduction phases out for taxpayers with incomes in excess of $157,500 on an individual return and $315,000 on a joint return. Higher Estate Tax Exemption Congress couldn’t bring itself to completely kill the federal estate tax, but lawmakers doubled the amount you can leave heirs tax-free. That means even fewer Americans will ever have to pay this tax. Starting in 2018, the tax won’t apply until an estate exceeds about $11 million. This means a married couple can leave about $22 million tax-free. These amounts will rise each year to keep up with inflation. The Angel of Death Tax Break That’s what we call the provision that increases the tax basis of inherited assets to the value on the date the previous owner died. When it appeared that the new law would repeal the estate tax, some observers worried that the step-up rule would be changed or eliminated. In the end, the estate tax was retained, as noted in the previous slide. And, the step-up rule survived. If you inherit stocks, mutual funds, real estate or other assets, your tax basis will, in most cases, be the value on the day your benefactor died. Any appreciation prior to that time is tax free. Source: Kiplinger.com

Credit cards are a great tool. They can help you build credit and get paid for purchases you'd have made anyway. Alternatively, credit cards can be a path to financial ruin, leaving you deeply in debt and unable to accomplish financial goals. It all comes down to whether you make credit work for you -- or you become the credit card industry's dream customer. The good news is, mastering credit doesn't have to be hard. Just follow these five steps to make money off credit cards instead of having credit card companies make money off you. 1. Don't let your rewards go to waste Rewards cards are far more popular than cards that don't offer perks, but 31% of credit card users don't claim their rewards. This is a huge mistake akin to throwing out free money. To avoid making it, ensure you're using a card offering rewards that make sense for you. To find the right credit card, the foremost consideration should be whether you'll actually use the rewards, because it doesn't matter how many rewards you earn if they're never claimed. You may also wish to look for a card that rewards the types of purchases you routinely make. You can find cards geared toward many different categories of spending, ranging from travel and online shopping to gas station and grocery store purchases. Just don't be so wooed by the promise of a generous rewards program that you sign up even though you don't actually want the rewards being offered. 2. Don't pay interest No matter how much you earn in credit card rewards, you'll still lose money if you're paying interest. The average interest rate on a credit card is 15.99% for travel cards and 20.90% for cash back cards as of 2017. Interest, especially at these rates, makes it harder to repay your debt and costs you a fortune. If you owed $5,000 on a card with 20.90% interest and paid minimum payments of $137.50 monthly, it would take you 279 months to pay off your debt and you'd spend $8,124.64 in interest. That's a lot of money that could have gone toward retirement or a nice vacation. If you're already in debt and paying interest, make a plan to get out of debt ASAP. If you're committed to repayment and can avoid irresponsible spending in the future, consider transferring the balance of your debt to a balance transfer credit card offering a special introductory 0% rate. Most balance transfer cards charge you a small fee for the transfer -- typically around 3% -- but paying to transfer debt to a 0% interest card can still be a financially sound move since the 0% interest is so much lower than what you were paying before. Whether you opt for a balance transfer or not, make a plan to pay off debt as aggressively as possible. 3. Don't pay late Along with paying interest, paying late is also a financial disaster. A late payment can come with a fee up to $27 for a first late payment and $38 for a second within six months. A payment that is 30 or more days late will also be reported to the credit reporting agencies whose data provides the basis for your credit score. FICO data shows being late by 30 days could cause your credit score to decline as much as 90 to 110 points, if you previously had a score of 780 and no missed payments. If your score was 680 and you'd already been late twice, another late payment could lead to a drop of 60 to 80 points in your credit score. To avoid paying late, consider using auto-pay so at least the minimum payment is deducted from your bank account automatically. You can also set yourself calendar reminders. If you've already got a late payment on your credit report, ask your creditor for a good will adjustment. Often, if you've been a good customer and haven't made a habit of paying late, your creditor will be willing to take the late payment off your record. 4. Don't close old credit cards Old credit cards collecting dust in your wallet may seem useless-- but these cards are doing an important job for you by helping your credit score. Your credit score is calculated based on a number of factors, including payment history and mix of available credit. One of the factors that matters is the average age of your credit. This accounts for around 15% of a FICO score, and older is better because a long history of responsible payments shows lenders they can trust you. If you close old accounts, you'll lower the average age of credit and your score will take a hit. Another key factor essential to a good score is to keep your credit utilization rate low. Your credit utilization rate is worth 30% of your FICO score and it refers to the amount of available credit you've actually used. Ideally, you'll use no more than 30% of available credit to get high marks from lenders who don't like to see maxed-out cards. If you close old credit cards you aren't using, you reduce your available credit and hurt your utilization rate. If you had two credit cards each with $5,000 limits and owed a $3,000 balance on one card, you'd be right at the 30% utilization rate. If you closed your old card and now have just $5,000 in available credit, you'd be using 60% of your available credit -- a major red flag to lenders. 5. Don't open too many new credit cards all at once Opening too many new credit cards at the same time will also damage your credit score. When you apply for credit, an "inquiry" is placed on your credit report. This is true whether you're approved for credit or not. Too many inquiries make creditors nervous you may be about to go on a spending spree. Avoid this by limiting the amount of credit cards you open so you aren't constantly getting new inquiries on your record. Opening a few new credit cards all at once also lowers your average account age, hurting your score again. And, unfortunately, having all that open credit could potentially prompt you to charge more than you should. Don't create a temptation for yourself that could lead you into debt by having a lot of credit cards sitting around. You can master your credit Credit card issuers made $163 billion in 2016 in fees and interest charges. It's up to you if you want to fatten the pocketbooks of card issuers or if you want to have more cash to save for retirement and other financial goals. If you hope to keep more money in your own pocket instead of sending it to creditors, you have the tools to do that. Following these tips will help you keep your credit score as high as possible so you can get favorable interest rates, and you'll be able to avoid late payments or lost rewards. Source: USAToday.com

Older Americans are increasingly digitally savvy — but they are still a prime target for online scams. Nearly half (42 percent) of adults ages 65 and older now own smartphones, a number that's quadrupled in the last five years, according to a report by Pew Research Center conducted last year. Internet use by seniors has similarly jumped — and for the first time, half of older Americans have broadband at home. But with all that access to technology comes the increased risk of becoming a victim of cybercrime. In fact, internet scammers disproportionately target older Americans because they tend to be wealthier, more trusting and less likely to report fraud, according to the FBI. Another 2015 report estimated that older Americans lose $36.5 billion each year to financial scams and abuse. Davis Park, director of technology outreach program Front Porch Center for Innovation and Wellbeing, offers these tips to seniors – and everyone – for staying safe online: Choose a strong password. Passwords should be 12 to 15 characters long with strategically placed special characters or symbols. You should have different passwords on each of your online accounts. To help keep track of them all, use a password manager, like 1Password, Dashlane or KeePass. Keep your antivirus software up to date. That will help prevent hackers from accessing your computer, laptop and smartphone, as well as alert you to websites and downloads that could be suspicious. Use only trusted Wi-Fi resources. Free Wi-Fi seems convenient, but hackers can also use it to intercept your internet communications. Before joining a network at say, a coffee shop or retailer, confirm that the Wi-Fi connection you want to join belongs to the business you know and trust. When in doubt, use your personal Wi-Fi hotspot, or the network connection on your smartphone. Google it. Research any unfamiliar websites or email solicitations before giving up your information. Often, hackers create a link that may appear, at first glance, to be a legitimate website to trick you into giving up your personal data. Don't give your personal info. Be particularly wary of any request to provide information such as your date of birth, Social Security number or bank account. There are an increasing number of scams perpetrated by professional thieves who target vulnerable seniors, but you can protect yourself by knowing what to watch out for. Source: Cnbc.com

Social Security serves as a key source of income for countless retirees and disabled individuals. It's also an extremely complex program loaded with rules and terminology. If you're attempting to learn about Social Security (which is something you should do, regardless of how old you happen to be), here are a few key terms you'll need to understand. 1. OASDI OASDI stands for old age, survivors, and disability insurance, and in the context of your paycheck, it's the tax used to fund the Social Security program. The current OASDI tax rate is 12.4%. If you work for an outside company, you'll lose half that amount of your earnings up to a certain income limit, while your employer will pay the remaining 6.2%. If you're self-employed, however, you'll pay the full 12.4% up front. 2. SSI SSI stands for supplemental security income, and it's different from OASDI in that it's a program funded by general tax revenues, not Social Security taxes. SSI is designed to help those who are over 65, blind, or disabled with limited financial resources keep up with their basic needs. 3. FICA Tax FICA stands for the Federal Insurance Contributions Act. It's the tax that's withheld from your salary or self-employment income that funds both Social Security and Medicare. For the current year, FICA tax equals 15.3% of earned income up to $127,200 (12.4% for Social Security and 2.9% for Medicare), but those making above $127,200 will continue to pay 2.9% FICA tax on income exceeding that threshold. In 2018, the earnings cap will rise to $128,700. 4. Social Security credits In order to collect Social Security benefits, you must earn enough credits during your working years. In 2017, you'll receive one credit for every $1,300 in earnings, up to a maximum of four credits per year. For 2018, the value of a single credit will rise to $1,320 of earnings. Those born in 1929 or later need 40 credits to qualify for benefits in retirement. 5. AIME AIME stands for average indexed monthly earnings, and it's used to calculate your personal Social Security benefit. The amount you receive from Social Security is based on your highest 35 years of earnings. To arrive at your AIME, your past earnings are adjusted for inflation so that they don't lose value. 6. Full retirement age Your full retirement age, or FRA, is the age at which you're eligible to collect your Social Security benefits in full. FRA is based on your year of birth, and for today's older workers, it's 66, 67, or 66 and a number of months. Though you're allowed to claim benefits prior to reaching FRA (the earliest age is 62), doing so will cause you to collect a reduced benefit amount -- permanently. 7. Delayed retirement credits Though waiting until full retirement age will ensure that you collect your benefits in full, if you hold off on filing for Social Security past FRA, you'll rack up delayed retirement credits that will boost your benefits. Specifically, for each year you wait, you'll get an 8% increase in your payments. Delayed retirement credits stop accruing at age 70, so that's typically considered the latest age to file for Social Security (even though you can technically wait even longer than that). 8. Trust Fund The Social Security Trust Fund was established in the early 1980s to cover any future shortfalls the program might face. If Social Security has a year in which it collects more taxes than it needs to use, that money is placed in the Trust Fund and invested in special Treasury bonds. Once Social Security's incoming tax revenue fails to cover its scheduled benefits, the Trust Fund will be tapped to make up the difference. Come 2034, however, the Trust Fund is expected to run out of money, at which time future recipients might face a reduction in benefits. 9. COLA No, we're not talking about a soft drink. In the context of Social Security, it stands for cost-of-living adjustment, and it's designed to help beneficiaries retain their purchasing power in the face of inflation. Back in the day, those who collected Social Security received the same benefit amount year after year. But beginning in 1975, beneficiaries have been eligible for automatic COLAs based heavily on fluctuations in the Consumer Price Index. COLAs are not guaranteed, however. If consumer prices don't climb in a given year, benefits can remain stagnant. Such was the case as recently as 2016. 10. Survivors benefits Survivors benefits are designed to provide income for your beneficiaries once you pass. Those benefits are based on your earnings records and the age at which you first file for Social Security. Surviving spouses, children, and even parents of deceased workers are eligible for survivors benefits. Clearly, there's a lot to learn about Social Security, but familiarizing yourself with these key terms will help you better understand how the program works. It also pays to read up on ways to maximize your benefits so that you end up getting the best possible payout you're entitled to. Source: USAToday.com

Electric bills are kind of a mystery. You always remember to turn off the lights before you leave, so why is your bill still sky high? The average household spends about $112 a month on energy bills and prices are steadily rising, according to the Energy Information Administration.  The first step to demystifying your electricity bill, and hopefully reducing it, is to take stock of where you use the most energy.  "Cutting energy waste results in energy savings, but it also translates into money savings," said Kateri Callahan, president of the Alliance to Save Energy, a coalition that promotes energy efficiency. You can find a professional energy auditor to help you assess your home's energy use, potentially for free, through your electric company or the Department of Energy’s website. If you follow their efficiency upgrade recommendations, you could shave 5% to 30% off your energy bill.  Free and Easy Lifestyle Changes Can Add Up Heating/Cooling Heating and cooling takes up the largest chunk of your monthly energy bill, but cutting back doesn't have to mean being uncomfortable. Callahan recommends cleaning your heating, ventilation and air conditioning (HVAC) unit every 30 days to keep the system running efficiently. “If you’ve got clogged or dirty filters, you’re just using more energy to push that air through,” she said. Keeping the blinds open in the winter and closed in the summer can also reduce the burden on your HVAC system, she added. Using a ceiling fan instead of your air conditioner can keep temperatures and costs low in the summer.  These three steps combined can save you anywhere from $62 to $118 per year, Energy Impact Illinois estimates. Water heaters Water heaters are typically large energy consumers and Callahan suggests lowering the temperature on your water heater from the standard 140°F to 120°F. This can reduce water heating costs by 4%-22% annually, according to the Department of Energy. Washing your clothes in cold water can cut costs since about 90% of the electricity consumed by washing machines is used to heat the water. The Environmental Protection Agency estimates that can save the average household up to $40 per year. Air drying your clothes can further reduce energy consumption and save you money.  Appliances A typical American home has 40 products that are constantly drawing power, even if they're not in use. This is responsible for 10% of your electricity use, according to the Lawrence Berkeley National Laboratory. Energy vampires, like your phone charger, computer and coffeemaker, can cost the average household $100 a year, according to the Energy Dept., and should always be unplugged when not in use. “An easy way to do this and make sure it all gets done is to have a power strip,” said Callahan. Power strips make it easy to unplug everything at once, and smart power strips automatically cut power to devices that are in standby mode. If you're diligent, you can cut your standby power consumption by 30%, the Lawrence Berkeley National Laboratory reports.  Discounts Although you probably only interact with your utility company when it's time to pay the bill, Dr. Iain Walker, a scientist at the Lawrence Berkeley National Laboratory, recommends checking its website for savings opportunities. Some utility companies offer rebate programs and off-peak rates which can be up to 30% cheaper, Walker said. "There's a lot of good stuff out there," he said. Customers can capitalize on this by "load shifting," or saving energy-intensive activities until the rates are low.  Long term investments: Bigger savings Behavioral changes do add up, but you have to alter your home to really make a difference in energy consumption, Walker said. Long-term savings come from bigger investments, like getting new windows or proper insulation. If you're planning on upgrading your appliances, many companies and states offer rebates that make it cheaper to purchase energy saving technology, like LED bulbs or Energy Star certified appliances.  "The more you spend, the more you save," he said. Heating/cooling Seal leaks, doors and windows. Homeowners should start by buying cheap caulk and weatherstripping, Callahan says. This can reduce energy use by at 15% to 30% on your heating and cooling costs each year, the Department of Energy estimates. "Those cracks and leaks can be the equivalent of a 3 foot by 3 foot window open all the time," Callahan said. Buy a programmable thermostat. For as little as $20, you can automatically set your thermostat back 7°-10°F for 8 hours a day. Doing so can save up to 10% on your heating and cooling costs, according to the Department of Energy. "That’s a great way to make sure that you’re not wasting energy when no one’s home except the goldfish," she said.  Install or add insulation. Insulation can cut your costs but estimated savings varydepending on your location and fuel type. "There are many utility programs out there that will give you a pretty good rebate if you add insulation to your home," Walker said.  Lighting Both experts recommend switching to LED bulbs, which last much longer and are 90% more efficient than traditional bulbs.  Replacing your five most used lights with Energy Star approved LED bulbs can save you $75 per year.  Appliances "Don't throw out good equipment, but if you’re in the market or the systems are getting old, buy the most efficient items," said Callahan. Energy efficient appliances sometimes cost more upfront, but can save you money in the long run. An Energy Star certified refrigerator, for example, could set you back about $800 or more depending on the size, but the you could save $260 in energy costs in five years. Source: USAToday.com

An IRS-tax industry crackdown is making progress in the battle against identity theft and tax refund fraud, officials said as they announced plans for additional safeguards in 2018. Fewer federal tax returns linked to identity theft entered the tax system in 2016, and the number of taxpayers who said they'd been victimized also dropped, along with the number of fraudulent refunds issued, the officials said. Updating the results from the public-private effort launched in 2015, officials from the IRS, tax preparation firms, tax preparers and other industry leaders also unveiled plans for broader use of a 16-character security code on W-2 form tax forms and additional safeguards for the 2018 tax-filing season. Among the highlights: The IRS stopped 883,000 tax returns with confirmed links to identity theft in 2016, a 37% drop from the year before. The nation's tax agency also stopped 443,000 potential tax refunds linked to identity theft, a 30% year-over-year decline. Financial institutions stopped 124,000 suspect tax refunds in 2016, half the number detected in 2015. The companies have stopped 127,000 suspicious refunds so far this year, reflecting a handful of cases involving several thousand accounts. The number of taxpayers who told the IRS they had fallen victim to identity theft dropped to roughly 376,000 in 2016, a 46% decline from the year before.   "We've seen the number of identity theft-related tax returns fall by about two-thirds since 2015," IRS Commissioner John Koskinen said in a statement announcing the update. "This dramatic decline helped prevent hundreds of thousands of taxpayers from facing the challenges of dealing with identity theft issues." The declines stem in part from the first-of-its-kind partnership between the IRS, state tax agencies, major tax-preparation companies and other tax industry participants. Spurred by continuing spikes in identity theft and tax refund fraud, the agencies have been sharing information and implementing new electronic safeguards and other measures aimed at thwarting identity thieves. For instance, tax industry representatives have shared dozens of key data points from electronically-filed tax returns that have helped the IRS to identify tax scams and block fraudulent refunds. File photo taken in 2014 shows the Internal Revenue Service headquarters building in Washington, D.C. (Photo: J. David Ake, AP) As the crackdown continues in 2018, all official IRS W-2 forms used to file federal tax returns for the first time will include a verification code box. A 16-character code will appear on approximately 66 million W-2 forms, more than half of all forms issued, Koskinen estimated. Taxpayers who prepare their own tax returns and tax preparers will be urged to enter the code in the verification box if their form includes the 16-character entry. If you search the IRS website for tax forms, you'll get over 900 results. Here are the ones you need to know. Walbert Castillo, Ramon Padilla, Karl Gelles, USA TODAY Additionally, the IRS will ask tax professionals to gather more information about clients who file business tax returns.  The data could include the name and Social Security number of the business representative authorized to sign the tax return, as well as details of any estimated tax payments made before the return was filed. Koskinen's IRS term expires in November, so he won't head the agency for the 2018 tax filing season. During a media conference call, he said Treasury Secretary Steven Mnuchin has been focused on "finding a successor." "We know that cybercriminals are planning for the 2018 tax season, just as we are,"  Koskinen said. "This coming filing season, more than ever, we all need to work diligently and together to combat this common enemy." Source: USAToday.com

Taking just a little time now (even just an hour) can save you a lot of stress, money and time later on when you'd rather enjoy the holiday season. If that gets your attention, keep reading for a few easy, important tips to get organized now for a successful shopping season later. Dig out last year's shopping list. In today's digital age, "digging out" last year's shopping list is hopefully as easy as opening a saved file on your computer, tablet or smartphone. Take a look at who you shopped for last year and how much you spent. This can refresh your memory, help create a budget for this year and kick-start your new shopping list. Create a budget. Knowing how much you spent on gifts last year is helpful, but you should also survey this year's financial situation to see how much you can afford to spend. If you have a savings account for holiday shopping, check the balance. Also see what expenses are coming up and make sure you have a cushion for emergencies. When creating a budget for the holidays, give yourself a spending limit for gifts and don't forget to account for entertaining and party hosting, decorations and travel costs. For even more control over your budget, you can narrow down a budget per person on your shopping list. If this is sounding like more lists than you know how to manage, you'll want to check out the next tip. Download a holiday planning app. Technology saves the day again: There are several helpful (and free) apps to help you plan, budget and organize the holiday season. Santa's Bag is a popular iOS app that gives you an easy and colorful platform for budgeting, planning and checking off the items on your list. You can create a total budget amount and an amount per person, and the app will automatically update your budgets when you tell it how much you spent. The app allows you to enter everything from your gift ideas to whether an item has been purchased and even wrapped. For Android users, Christmas Gift List is a similar solution with the ability to track all your shopping, keep an overall and per person budget, and even archive lists so you can check back on previous years. Prioritize your shopping. After you start your list, you might notice there are a few gifts that are more specific than others. Your wife might be hoping for a new cashmere sweater, but your daughter has that specific new smartphone in mind – plus, she'd love it in that hard-to-find color. For gifts that will fly off the shelves early, make a priority to get these first. Of course, waiting for the week of Thanksgiving and Cyber Monday will give you the best chance of finding a deal, but you may want to keep an eye out for savings starting now. Note which gifts on your list need early attention and which ones are more generic or flexible that can wait until later. Subscribe to stores and coupon websites. Now is the perfect time to get on the email lists of the stores where you know you'll do most of your shopping. You'll be first to know when they have flash sales or free shipping days. You can also follow the accounts of your favorite shops on social media for exclusive sales and promotions. Subscribe to coupon and cash back websites and sign up for alerts now, and you'll have all the best deals hitting your inbox directly – the perfect solution when you need an idea for the sibling who has everything. See, that wasn't too hard. Now that you spent a little time getting organized for the holidays, you can go back to enjoying fall. Here's one last tip: Stock up on heavily discounted candy the day after Halloween and use it for delicious holiday dessert recipes next month.  Source: Money.USNews.com

According to the Huntington Bank Backpack Index, the cost of school supplies increased 88% from 2007 to 2016, and their recently released 2017 report anticipates increases of 1.0% for elementary and 4.6% for middle schoolers this coming school year. Even so, there are reasons that parents can feel good about back-to-school shopping: 1.  It’s an exciting time of year, and parents can share in their children’s enthusiasm. 2.  It’s a chance to spend time with your kids while teaching them smart shopping habits. 3.  It’s an opportunity for what I call “painless savings:” if you consistently watch your spending on “the small stuff” like school supplies, groceries, and clothing, over time you can significantly increase in your overall savings. To maximize the learning experience, involve your kids in the back-to-school shopping process. Start by reading this article with them. Together, identify your spending goals and decide where you’ll do your shopping. Discuss a strategy for spending on “extra” things that are not on the shopping list. For example, when your child can’t live without a new tablet, even though you think her current one is fine, who gets final say? Here are 8 more tips your family can consider during this back-to-school season: 1.  Visit your local brick and mortar retailers. Stores such as Staples, Office Depot, and Walmart offer competitive bargains versus internet-only retailers. Look for specials and door busters, but try not to let good prices lure you into spending on things you don’t need. Also, don't forget about local discount retailers who have low pricing year-round, such as Dollar Store or Five Below. 2.  Shop during your state’s sales-tax holiday. Many states offer a shopping day or weekend during which they waive state sales tax. On these days, you can avoid state and local taxes, which can approach 10% in some states. 3.  Use store coupons and rewards programs. Before heading to a retailer, check your mailbox for weekly coupons and store websites for printable coupons. Art supply stores such as Michaels often have coupons in the Sunday paper. Or simply download them onto your smart phone. These can mean big savings on your more expensive items. Coupons may even be available to pick up “in store;” so don’t forget to ask once you’re there. You can also sign up for a store loyalty program where you can earn rewards points toward future purchases. 4.  Combine your deals. If you find a great sale at your local retailer, shop during a sales tax exemption period, use some coupons, and earn rewards points, you have just hit the grand slam of savings! If you pay with a credit card that gives you cash back, you can save even more—just don’t let those credit card balances run up and accrue interest charges. 5.  Online shopping is still the biggest timesaver, and we all know time is money. In addition to Amazon, there are other web-based competitors such as Oriental Trading Company and eBay. If your family feels that time is your scarcest resource, searching for deals online may still be your best way to save both time and money. 6.  Consider taking advantage of any pre-packaged, school supplies program offered by your school district. This usually involves paying online for a tailored packet of school supplies that is delivered to the school, ready for use. These programs can offer competitive pricing and save you the time and effort of shopping online or driving to the store. 7.  Buy used textbooks or download digital textbooks. If buying used books makes you cringe because you're concerned about the quality of the retailer, be assured that both Barnes and Noble and Amazon are dominant in this space. But for really deep values, you may want to look at other providers—just do some research on these lesser-known retailers before sending them your money. 8.  The best way to save may be not to spend at all; you may already have on hand some of the things on your shopping list. Look around your house before you shop. I’m a big believer in the power of spending less on the small stuff whenever you can in order to accrue big savings in the long run. I’ve written more about this idea of “painless savings” in Countdown To Financial Freedom. The earlier in life that young people begin to apply this saving strategy, the more they will benefit in terms of the compounding growth potential of the money they are able to save. That is how the back-to-school shopping process can positively influence your children’s financial education and their future net worth. And that is something we can all feel good about! Source: Forbes.com