Money Management

Need a California state tax extension to avoid paying late fees for the 2023 tax year? Find out how to ask for one correctly. [[{“value”:”

File this, file that. Maybe you’re not ready to file. That’s okay — the Golden State makes it easy to delay filing taxes. Whether you’re waiting on a form or just need more time, you can delay filing your taxes until Oct. 15. (And if payments are a problem, you can delay those, too.)

According to the California Franchise Tax Board (FTB), there’s no need to fill out any application. All Californians qualify for the extension. But there’s a catch: You must pay your estimated taxes by April 15, the tax-filing deadline, or else you’ll be smacked with late fees.

To recap: You can delay filing taxes, but you can’t delay paying taxes, with few exceptions. It’s weird, we know. Read on to find out how to get a California state tax extension the right way.

Cheapest: Make extension payment via WebPay

So, you’ve decided to file taxes between April 15 and Oct. 15, 2024. There’s one thing you need to do to avoid late fees, and that’s make an extension payment. Extension payments can be made via a handful of ways, including bank transfer, credit card payment, or check.

The cheapest way to pay is by using WebPay, the FTB’s fast and free payment platform. Here’s how to file an extension payment via WebPay:

Navigate to the WebPay portal.Enter personal information, including last name and Social Security number.Fill out mailing address information.Select “Extension Payment (Form 3519)” as payment type.Enter tax year, payment amount, and payment date.Enter bank account information.Fill out remaining fields and submit.

You can estimate your taxes by looking at the previous year’s tax return and comparing it to what forms you’ve managed to cobble together. When in doubt, overpay. California will refund you for overpaying, but if you severely underpay your taxes, you could be on the hook for late fees.

If you submit your extension payment electronically, you don’t need to fill out any other special forms. But to submit via snail mail, you must file the form Payment for Automatic Extension for Individuals (FTB 3519).

Snail mail: File form FTB 3519

To submit a tax extension by mail, fill out the form FTB 3519 and submit it by April 15, 2024.

How to file form FTB 3519

Unsure how to get started? Here’s a step-by-step breakdown of how to submit FTB 3519 and pay by check or money order:

Fill out Form FTB 3519 with your personal information.Make your check or money order payable to “Franchise Tax Board.” Write your Social Security Number or Individual Taxpayer Identification Number, the tax year, and “Form FTB 3519” on the check or money order.Detach the payment voucher from the bottom of Form FTB 3519 and enclose it with your check or money order in an envelope.Mail the envelope to the address provided on the form:

Franchise Tax Board

PO Box 942867

Sacramento, CA 94267-0008

Submitting the form will prevent the FTB from charging you fees for late filing. Once you file your tax return, you’ll be refunded for overpayment or charged for underpayment.

Easiest: Use tax-filing software to file a tax extension

Your tax preparation platform may file a California state tax extension for you. If you’re a customer of a platform like TurboTax, check in there. It could save you time, though you’ll probably pay extra for the privilege. The best tax-filing software makes submitting forms easy.

How to delay paying taxes in 2024

You can easily delay filing California state taxes, but delaying payments is trickier. Generally speaking, the longer you wait to pay post-deadline, the bigger the fees you’ll owe.

One notable exception is installment payments. If you meet the prerequisites, you can pay your state tax return in installments, spreading out payments over three to five years. It costs $34 to set up a payment plan, so you’ll be paying a bit extra in the long run. But it keeps payments low.

If you can’t pay a bill on time, you can request a one-time 30-day extension. You must log in to your MyFTB account, navigate to the “Services” menu, and select “Delay my payment.” The catch is you’ll pay interest on top of your original balance.

Still can’t afford to pay taxes? File your taxes anyway. The penalty for filing late is much worse than the penalty for paying late. Better to file on time and pay late than to be late on both.

First time filing taxes? Check out our simple tax-filing guide. It’ll take you through getting your documents ready and choosing how to file.

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A recent survey revealed how much money is needed to join the 1%. See the answer and learn what it takes to build wealth. [[{“value”:”

“The 1%” is a popular term used to refer to the wealthiest people in the country. It clearly requires a large amount of money to join that group, but for most people, the exact amount is a mystery.

If you’re curious about how much it takes, or if you want to set some very high goals for yourself, a recent report has the answer. Below, we’ll go over how much money you need to be in the 1% and the most important steps for building wealth.

Joining the 1% club

You need $5.8 million to join the 1% in the United States, according to The Wealth Report by Knight Frank. That’s based on data from the fourth quarter of 2023.

The United States has one of the highest wealth thresholds to join its 1%. It comes in fourth, behind only:

Monaco: $12.9 millionLuxembourg: $10.8 millionSwitzerland: $8.5 million

For most people, it’s not realistic to amass this much wealth. It is the top 1%, after all. And this threshold generally goes up over time. A year ago, it took “just” $5.1 million to be in the 1% in the United States. The current figure of $5.8 million is an increase of nearly 14%.

The vast majority of people will be somewhere in the other 99%, and there’s no shame in that. But it’s still important to do what you can to build wealth for your own financial security, and so you’ll have enough to retire when you’re ready.

What you can do to build wealth and financial security

Even though everyone’s financial situation is different, there are some simple steps that anyone can follow to improve financially. Here’s what you can do to save more money and build a retirement fund.

Invest at least 10% of your income. When you invest, you put your money in places where it can grow. One of the most popular and effective investments is index funds. These invest your money in a large number of stocks. You can even invest in index funds that follow the performance of the entire U.S. stock market.Seek out raises throughout your career. Because of inflation, if your salary stays the same year after year, it gradually becomes less valuable. Try to get a raise every year. You could do that by talking to your current employer, switching jobs when new opportunities are available, or adding a side hustle for another income stream.Stay out of high-interest debt. As a general rule, if you have any debt with an interest rate of 10% or more, pay it off as quickly as possible. One of the biggest problems for many American families is credit card debt. The average credit card interest rate is over 20%, so this type of debt makes it much harder to reach your financial goals.Save an emergency fund. You never know when you’ll run into an unexpected issue, such as a job loss or a surprise bill. Experts recommend having at least three to six months of living expenses in emergency savings. That’s a lot of money to save, but if you set aside money toward your emergency fund every month, you’ll eventually get there.

Following these rules may not get you to the 1%. To join that group, you typically need to earn a very high salary or start a successful business. Or have rich parents — that never hurts.

But you can certainly get into a more comfortable financial position this way. And ultimately, what’s important isn’t making it into the 1% — it’s being able to use your money to live the life that you want.

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Is your salary under $50,000 per year? Read on for some tax breaks you may be entitled to. [[{“value”:”

Being a lower earner might make your bills difficult to manage. But unfortunately, that doesn’t let you off the hook from paying taxes. The good news, though, is that there are certain tax breaks you may be privy to if you earn $50,000 or less. Here are some tips that can help you maximize them.

1. Don’t spend money to file your taxes

If you earn $79,000 or less, you’re eligible to file your taxes for free. What’ll happen is you’ll get tax software options to choose from, and you’ll be able to submit your return electronically.

That’s a good thing, because if you’re due a refund, you’re going to want that money to hit your checking account as soon as possible. Electronically filed returns are typically processed much more quickly than returns filed on paper.

2. See if you qualify for the Earned Income Tax Credit

A tax credit is a dollar-for-dollar reduction of your tax liability. Some tax credits are non-refundable, which means the most they can do is reduce your tax liability to $0. But the Earned Income Tax Credit, or EITC, is fully refundable. So if you’re eligible for it, it could put a nice chunk of money in your pocket.

As you can see from the following table, if you earn $50,000 or less, whether as a single tax-filer or a member of a couple filing jointly, you may qualify for the credit.

So let’s say you’re married with a joint household income of $48,000. As long as you have one or more qualifying children in your household, you should be eligible for the credit.

3. Claim back some of your child care costs

If you earn $50,000 or less, then child care costs may be a huge burden for you. But one credit called the Child and Dependent Care Credit could offer some relief.

The credit allows you to claim between 20% and 35% of up to $3,000 in child care costs for one child, or between 20% and 35% of up to $6,000 in child care costs for two or more children. Children need to be under the age of 13 to count for the purpose of the credit.

The percentage of your costs that you’re allowed to claim depends on your income. If it’s $15,000 or less, you can claim 35% of the aforementioned costs. That percentage then decreases as your income increases. But for those making $43,000 or more, the percentage of costs you can claim is 20%.

So, let’s say you make $45,000 and have one child whose care costs you $8,000 per year. In that case, you can claim 20% of $3,000, or $600. You should also know that unlike the EITC, the Child and Dependent Care Credit isn’t refundable.

If you don’t earn such a high wage, it’s important to snag every single tax break you can. These specific benefits are ones that might do you a world of good, so make sure to take advantage of a free tax-filing service and to claim any credits you’re entitled to.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
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A little advanced planning could make your summer trips go off without a hitch. Read on to see what moves it pays to make now. [[{“value”:”

Summer tends to be a popular time for travel, and understandably so. It’s a time when school’s not in session, the weather is warm, and schedules tend to be more relaxed.

Data from IPX1031 finds that 50% of Americans plan to travel more in 2024 than in 2023. And 85% will leave their home state to travel, while 38% intend to travel internationally.

But depending on the trips you’re planning, you could be looking at spending a substantial amount of money during your travels. And you may also be looking at crowds. Make these moves now so that neither one is an issue.

1. Book your stays in advance for popular destinations

Think you’ll be able to just arrive at a national park this July and get a hotel room nearby? Think again. Popular destinations like national parks and theme parks tend to book up for summer in advance, so this is one situation where winging it might come back to bite you.

Instead, commit to your summer destinations within the next couple of weeks, and then start researching lodging to make sure you’re not shut out. You may also want to book your flights in advance if you have a limited window of time to travel in.

Remember, just because you’re able to find flights for the dates you need doesn’t mean you’ll be looking at affordable flights. So any time you’re traveling during a popular period of the year, it’s a good idea to make your arrangements ahead of time.

2. Open a travel rewards card with a sign-up bonus

A generous credit card sign-up bonus could put a nice sum of money into your pocket. That’s cash you can use to pay for your upcoming trips.

If you’ll be securing lodging and flights ahead of time, you might as well put those expenses on your new card, as that could make it easier to meet the spending requirement needed to get your bonus. Also, when comparing credit card offers, you may want to focus on travel rewards cards. Not only do some of these offer nice sign-up bonuses, but travel reward cards commonly offer money-saving perks like free checked baggage and discounts on in-flight purchases.

3. Start banking your rewards points

Unless you’ve been diligently saving up for your summer trips already, you may find that covering your costs is easier said than done — especially if you’re bringing a large family along for the fun. One way to offset your travel costs is to rack up reward points on your various credit cards and reserve them for your upcoming trip.

At the same time, though, don’t just count on reward points. Instead, research your total travel costs, come up with a budget, and figure out how much of that your rewards (plus a potential sign-up bonus) will cover. Then, see how much of a difference you’re left with so you’ll know how much you need to save between now and your first departure date.

You don’t want to end up with debt during summertime travel. It’s important to come up with a game plan in advance.

Ideally, your summer travel plans will go off without a hitch. But make these moves so you don’t wind up stressed or disappointed.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
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A mortgage is likely to be the largest amount of money you’ll ever borrow. Keep reading to learn how existing credit card accounts can impact it. [[{“value”:”

If you’re hoping to take out a mortgage and buy a home, it’s important to consider your entire financial profile beforehand. Knowing how your credit stands and what kinds of red flags you might be waving at a mortgage lender can inform you what type of home loan you should apply for, as well as how much you could be approved for.

According to credit card research from The Motley Fool Ascent, the majority (74%) of Americans have two credit cards or fewer. But what if you have more — say, a double-digit number of active credit card accounts? Let’s take a closer look at how this can help — and hurt — your ability to secure a home loan.

A lot of credit cards: Not a deal breaker

Two credit cards or fewer might be the norm for Americans, but if you’re part of the 13% who have four or more, it doesn’t mean your quest to buy a home is doomed. I’m part of that 13%, and I know some of my colleagues here at The Ascent are too, and some of them own homes.

I’m currently house hunting myself, and I applied for mortgage pre-approvals with several lenders. No mention was made of my credit card roster, and since mortgage lenders access your credit report in the process of deciding whether you’re a safe bet to lend to, they saw them.

But they also noticed that I’m not carrying revolving credit card debt, and my balances are either $0 (in the case of cards I don’t use often) or very low. I have a small handful of core credit cards that I use for most of my monthly expenses, and I pay them off every month. I do this to benefit from purchase protections, cash back, and other rewards. Plus, using credit cards and paying them off on time is a great way to keep my credit score in good shape, meaning I’ll pay less to borrow money (say, in the form of a mortgage).

If this describes your relationship with credit cards, having more of them than the average shouldn’t hurt your ability to get a mortgage.

A lot of credit cards: Potentially a problem

But if you’ve got multiple credit cards and are struggling to manage the accounts, you could run into difficulty qualifying for a mortgage. If you’re carrying a lot of debt on multiple credit cards, and not paying off your balances every month, it could be a red flag for a mortgage lender. Are you relying on credit to get by? It might be indicative of an income problem more so than a spending problem. If you’re unable to cover your regular bills without the help of credit, can you afford mortgage payments?

Carrying credit card balances can directly hurt your credit score as well. A higher credit utilization ratio (say, above 30%) can have a negative effect — credit utilization is responsible for 30% of your FICO® Score. Your credit score impacts the interest rate you’ll be charged for a mortgage, and if your score is below 620, you may not get approved for a mortgage at all.

FHA loans are available to people with lower credit scores, but they tend to come with stricter requirements on the home the loan is being used to purchase. In some cases, home sellers may be reluctant to accept FHA offers due to the more stringent requirements for these loans. In short, having a lower credit score can make buying a home more expensive and more difficult.

Ultimately, the way you manage existing credit is a more crucial factor in buying a home than the nitty-gritty of how many credit cards you have. If you’ve got a lot of cards but don’t lose any sleep over paying them off every month, or you carry low balances, you’ve got a better chance than someone with maxed-out credit cards.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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