Money Management

Your taxes will be filed in no time if you do these five things. 

We’re now less than four weeks from the 2022 tax-filing deadline, but if you haven’t filed yet, don’t worry, you still have plenty of time left to get them done. But you shouldn’t wait too much longer to get started.

If you’ve been dragging your feet because filing taxes feels overwhelming, it can help to break it down into smaller tasks. Here’s a simple five-step process you can follow. You can even split it up over several days if that feels easier to you.

1. Figure out your tax-filing status

Knowing your tax-filing status is crucial to the rest of this process, so it’s a good idea to figure this out right away. There are five filing statues you can choose from:

Single: This is for unmarried adults with no dependents.Married, filing jointly: This is the status most married couples use.Married, filing separately: In rare cases, married couples may choose to file separate returns instead of a joint return.Head of household: This is for unmarried adults who have dependents.Qualifying widow(er): Those who were widowed and haven’t remarried may use qualifying widow(er) status in the two years following their spouse’s death.

You may only qualify for one status, in which case, your decision is easy. But if you qualify for more than one, you need to explore your options to decide what is best for you.

In general, it’s best for married couples to file jointly because it gives them access to more tax breaks and a higher standard tax deduction — the amount of your earned income the government considers non-taxable by default.

But filing separate returns could make sense in rare situations. For example, if one spouse had large medical bills, filing separately could help the couple save because you can write off large medical expenses that exceed 7.5% of your adjusted gross income (AGI). This is easier to do when you’re not counting your spouse’s income.

Also, those who are eligible for qualifying widow(er) status are often better off claiming this than opting for single or head of household status. Qualifying widow(er)s have the same tax brackets and standard deductions as married couples filing jointly, so they can earn more before jumping up to the next tax bracket.

When in doubt, a tax-filing software or a tax professional can help you choose the filing status that will save you the most money overall. All you need to do is provide your information.

2. Figure out if you need to file taxes at all

Some people don’t need to file a federal tax return for 2022. It depends on their annual income, their age, and their filing status. Here’s a table showing the minimum income at which you need to file a return, based on your age and filing status.

But just because you aren’t required to file taxes doesn’t mean you shouldn’t. Some refundable tax credits, like the Earned Income Tax Credit, can reduce your tax liability below $0, resulting in a refund for you. If you think you qualify for these, filing a return could lead to a nice check you can put toward whatever you want.

You may still have to file state taxes, but this depends on where you live. Some states don’t charge income taxes, but many do. Consult with a tax professional familiar with the laws in your state if you’re unsure whether you need to file state taxes for 2022.

3. Gather all your relevant tax documents

Filing taxes will go much more smoothly if you have all your documents at the ready. So gather yours together and find a folder to keep them in until you’re ready to file your return.

As a general rule, you’ll need documents for every source of taxable income you have and any tax break you plan to claim. This includes:

W-2s1099sDetails of retirement account, health savings account (HSA), and 529 plan contributionsReceipts for large medical bills or higher education expensesRecords of self-employment income and estimated taxes paid, if you own your own business

You’ll also need the birthdates and Social Security numbers for all individuals, including dependents, you’ll list on your return.

Now’s a good time to review this information for accuracy and completeness. If you realize you’re missing an important document, try to track it down. And if you notice an error, like a Social Security number that’s written incorrectly on a W-2, notify your employer immediately so you can get this corrected before you file your return.

4. Decide how you’ll file your taxes

After completing the three above steps, you should have what you need to file your return. But not everyone has the time to file their own taxes or feels confident doing so. Handing your taxes off to a qualified tax professional is an option, though it might be tough to find one accepting new clients right now. You may have to call a few places to find someone who can fit you in before the tax deadline.

The IRS maintains a Directory of Federal Tax Return Preparers who are qualified to assist you with your 2022 taxes. You can search by location and credentials to find ones in your area.

If you decide to file your taxes on your own, you’ll need to select a tax-filing software. Depending on your income, you may be able to file for free. But most require you to pay a fee to file your federal and state return. The exact cost will depend on the package you choose.

Some software now offers access to live tax professionals who can help you with questions that arise as you’re filling out your return. This could be a viable alternative to handing your taxes off to an accountant if you don’t feel confident doing your taxes on your own.

5. File your return

The final step is to actually get your return filed. This could mean submitting all your paperwork to the tax professional who will be doing it for you or sitting down with your tax software and crunching the numbers.

If you’re doing it yourself, it’s OK to take breaks. Your tax software should enable you to save your place and pick up where you left off at a later date.

Most tax software tries to break the process down into simple questions, but it can still be confusing sometimes. When in doubt, research the information on your own or consult with a tax professional to ensure you’re responding correctly.

When you’re all done, your tax preparer or software should tell you what kind of refund you’ll get or how much you owe the government. If you’re getting a refund, you can provide the bank account where you want the refund deposited. Those who owe can pay their debt in full if they’re able to do so. Or they can set up a payment plan with the IRS.

Once that’s squared away, you’re all done. Pat yourself on the back and enjoy another year before you have to think about taxes again. Be sure to hold onto all your 2022 tax documents, though. In the unlikely event that you’re audited, you’ll need to provide copies of your return and all associated paperwork to prove what you earned and which deductions you qualified for.

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Ticketmaster is coughing up some money for angry fans. 

If you purchased tickets to see The Cure earlier this month, you might have some money coming your way. Many fans are unhappy about the high fees they were forced to pay to secure tickets to see the band. However, Ticketmaster has agreed to give customers who previously bought tickets a partial refund due to the excessive fees charged. This news comes after the band’s frontman, Robert Smith, complained about the costly fees on Twitter.

Some customers will get a partial refund

The Cure is touring throughout the United States this spring and summer. The band used Ticketmaster’s Verified Fan platform in hopes of getting more tickets to fans instead of ticket scalpers. Fans using the Verified Fan platform could register for presale ticket access.

After tickets were made available to Verified Fans who had registered, customers were charged outrageously high fees. In some cases, the fees totaled more than the actual tickets. There were reports of customers paying more than $20 in fees for tickets that were priced at $20. Smith took to Twitter to express his frustrations and later discussed the matter with Ticketmaster, hoping to get more clarity for upset fans.

But there is some good news for fans who were impacted. On March 16, 2023, the musician tweeted that Ticketmaster had agreed to offer a partial refund. Those who purchased the lowest-priced tickets through a Verified Fan account would get a $10-per-ticket refund. Those who purchased other tickets through a Verified Fan account would get a $5-per-ticket refund.

Impacted customers will get refunds automatically. Additionally, those who have yet to buy tickets to see The Cure will now pay lower fees. While the refunds offered are meager, it’s nice to see some progress made in the fight to reduce outrageous ticket sale fees.

Extra fees add up and impact your finances

This isn’t the first time customers have complained about expensive fees charged by Ticketmaster. Live Nation Entertainment owns Ticketmaster. It’s estimated that both companies control about 70% of the live event ticketing market, so consumers have no choice but to pay extra fees when buying tickets for an event they want to see.

When ordering tickets through Ticketmaster, customers are charged multiple fees. On its website, the company outlines the fees customers may pay on top of the ticket price. That includes service fees, order processing fees, delivery fees, and facility charges. These fees make it more costly to go to an event, and can reduce your checking account balance.

Not knowing the total fees charged until checkout can also make it hard to budget for entertainment costs. Paying outrageously high prices for an event can negatively impact your personal finances. It’s no wonder so many consumers are upset and want more to be done.

Could extra ticket fees become more affordable?

Will more be done in the fight to eliminate excessive ticket fees? We can hope. In February, President Biden called on Congress to crack down on hidden junk fees, including event ticket fees. He hopes that both sides can come together to prohibit excessive fees and make it mandatory to disclose them in the ticket price for greater transparency. For now, we’ll have to wait and see if excessive fees become a thing of the past.

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Could this Dave Ramsey advice help you get extra money? 

For many people, coming up with extra money is hard — especially if you have an urgent financial need and must do so quickly. Luckily, there are ways to find more cash to stash in your savings account or brokerage account, or to use for important goals.

In fact, finance expert Dave Ramsey has offered four tips for finding extra funds. Here are a few ideas, along with some advice on whether you should follow his suggestions.

1. Reducing your grocery bill

Ramsey advised switching to less expensive meals — at least on a temporary basis — if you need to pile up cash quickly. “Your new favorite meal is beans and rice,” he said.

While reducing grocery costs can be effective, you’ll want to try to do it in a smart way, though — and that doesn’t mean compromising your health.

Opting to eat less meat doesn’t have to make your meals less nutritious and it can definitely reduce your expenditures, since meat tends to be expensive. You can also clip coupons, consider shopping at warehouse clubs if they offer lower prices, or make a meal plan based around what’s on sale.

2. Taking a pause on retirement investing

Ramsey advises putting your retirement investing on pause if you’re trying to repay creditors.

“Investing for retirement is really important,” Ramsey acknowledged. “But when you’re paying off debt, that needs to be your priority. It’s okay to temporarily pause your retirement savings while you work on getting out from underneath your car loan (or any other non-mortgage debt).”

This advice isn’t necessarily the best, though. Pausing your retirement savings can have major long-term consequences, since you could miss out on an employer match that helps your money grow. You’ll also miss out on tax breaks for retirement savings.

The longer you wait to start investing, the harder it will be to build a generous nest egg since you won’t have as much time for compounding to work for you (that happens when returns are reinvested and earn returns of their own).

You can follow this Ramsey advice if you have very high interest debt to pay off in a very short time. But in general, it’s best to both work on retirement investing and debt payoff at the same time so you don’t miss out on the unique benefits that come with saving for your later years.

3. Selling unneeded items

Ramsey also suggested selling things that you own that don’t provide much value. “We’ve all got so much crap we don’t even use. Start looking around the house and finding stuff you can sell online.”

This is solid advice because if you can turn your clutter into cash, why not do so? Facebook Marketplace makes it pretty easy to sell things — just be sure you don’t fall victim to scammers. Don’t send any items to anyone until you’ve been paid, and if you’re meeting people in person to do an exchange, consider doing it in a public place or a police station parking lot.

4. Picking up a side job

Finally, Ramsey suggests taking on a side hustle to bring in extra money to save. This can be good advice if you have the time or ability to do so. After all, while there’s a limit to how much you can realistically cut spending to save more, there’s no limit to how much extra you can earn if you get creative with your work or put in a few extra hours each week.

By following these four tips, you might just find yourself with the extra money to pad your investment account or work toward your current financial priorities.

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Demand just isn’t what it used to be. 

Any time you have a situation where there’s not enough supply of a given commodity to meet demand, its price tends to rise. That might explain why as of January 2023, home prices were still up 1.3% on a national level compared to a year prior, according to the National Association of Realtors (NAR).

A big reason home prices haven’t plunged on the heels of soaring mortgage rates is none other than a lack of inventory. As of the end of January, there was only a 2.9-month supply of available homes on the national real estate market, per the NAR. And it can take up to a 6-month supply of homes to fully meet buyer demand and level the playing field so sellers don’t have a clear upper hand.

Given where housing inventory is, it’s easy to see why you may be inclined to sell a home in today’s market without enlisting the help of a real estate agent. After all, if you don’t hire an agent, you won’t have to lose a portion of your sale proceeds to their commission.

But it’s important to recognize that buyer demand isn’t nearly as strong today as it was a year ago. And for that reason alone, hiring an agent may be worth it.

You might come out ahead financially

It’s gotten really expensive to take out a mortgage loan. Because of this, buyers aren’t clamoring for homes like they once were, and sellers are no longer getting away with commanding sky-high prices.

Now, this doesn’t mean you won’t end up getting a decent price for your home. But if you want to increase your chances of snagging a price you’re happy with, then you may want to get the help of a real estate agent.

Real estate agents — good ones, at least — are very in tune with the market. And they tend to be experts at pricing homes just right. So if you team up with one, they may be able to use their knowledge to price your home effectively.

Just as importantly, real estate agents are commonly great negotiators. So not only can an agent help you set the right home price, but they can also negotiate with potential buyers to get you a number you’re happy with.

Plus, any time you list a home, there’s the potential to spend a fair amount of money getting your property into better shape. A real estate agent can help you figure out where to prioritize your spending to make the most impact.

How to find the right real estate agent

One of the most important steps you can take on the road to finding a real estate agent is to ask people you know about their experiences. There’s nothing like a positive endorsement from a satisfied customer to point you in the right direction.

It’s also important to decide what you want from a real estate agent. You’ll want to focus on things like area expertise and communication skills.

Before you hire a real estate agent, talk to at least a few. Get a sense of how they work and what skills they bring to the table. Working with a real estate agent in today’s market could definitely pay off. But you’ll get the most benefit if you choose the right agent.

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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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You don’t need a lot of miles to book a free flight. 

Flying isn’t cheap. The average U.S. airline fare is nearly $300, according to the U.S. Bureau of Labor Statistics. And if you’re flying internationally, or you want to book premium seats, prices can easily exceed $1,000.

One of the best ways to cut your travel costs is with airline credit cards, which earn miles you can use for free airfare. For example, a card may offer 50,000 bonus miles for new cardholders who spend enough, as well as 2 miles per $1 on purchases. But it can be tricky to figure out how these miles translate into free flights. Is, say, 50,000 miles enough for one flight? Two? Here’s the answer.

How many credit card miles you need for a free flight

A good rule of thumb is that you’ll need 25,000 to 30,000 credit card miles for a round-trip economy fare within the United States.

That’s not the absolute bare minimum. With most airlines, free flights generally start at 5,000 to 7,500 miles per one-way segment. So to book a round-trip flight, you typically need at least 10,000 to 15,000 miles. But prices that low tend to only be available on short hops, meaning flights of about an hour to an hour and a half. For anything longer, you’ll need more miles.

In addition, there are several factors that can affect award airfare prices. And to make it more complicated, many airlines use dynamic award pricing. That means an award ticket’s price in miles can change at a moment’s notice.

The only way to know for sure how much a free flight will cost in miles is to search on the airline’s website yourself. Even that will only be the current price, which could change. But to give you an idea of what to expect, here are the factors that matter most in terms of how many miles a flight costs.

Route

The route often has the biggest impact on award airfare prices. As mentioned earlier, if you’re taking a short hop, like a flight from Los Angeles to Las Vegas, you could pay 5,000 to 7,500 miles each way. On the other hand, if you’re flying across the country, it could cost 15,000 to 25,000 miles or more each way.

International airfare usually costs more in miles than domestic travel. It’s not uncommon for these fares to cost 30,000 to 40,000 miles or more each way.

Fare class

Just like when you’re paying in cash, fare class makes a big difference. If you want to fly in business class or first class, you’ll need a lot more miles. For those premium travel classes, you can normally expect to pay at least 35,000 to 100,000 miles each way.

It can get even more expensive as well. Some airlines charge over 250,000 miles for first-class airfare during periods of high demand.

Another part of the fare class that matters is whether you book a “saver” or “anytime” award fare. Many airlines have these, although the exact name varies from airline to airline. Saver fares cost far fewer miles, but have limited availability. Anytime fares are easier to get, but they cost much more — often double or triple the price of a saver fare.

Making the most of your miles

Because award ticket prices vary so much, how you use your miles is important. When you know how to get the most from them, you can maximize their value. Here’s what makes the biggest difference:

Start searching for flights as early as you can. Award tickets, and especially cheaper saver fares, get harder to find the closer your travel dates are. If you start shopping early, you’re more likely to snag a saver fare and not need to use nearly as many miles.Try to be flexible about your travel dates. The more flexible you are, the easier it is to find deals. If you’re willing to adjust your travel dates by a few days or even a week, that could help you pay much less.

One other thing to keep in mind is that miles tend to offer more value when you use them for premium airfare. A $400 economy fare may cost 30,000 miles, whereas a $3,000 business-class ticket may cost 60,000 miles. If you have an upcoming trip where you’d really like to fly in business class or first class, consider saving your miles for that and paying cash for cheaper fares.

Flying free of charge

It’s not too hard to earn free flights with the right credit cards, as you don’t need a ton of miles. This does depend on your travel habits, but there are often round-trip domestic fares available for 25,000 to 30,000 miles, and sometimes less. And since many airline cards offer sign-up bonuses, earning those miles gets easier. If you get a card offering 60,000 bonus miles, that welcome offer could cover two free flights for you.

Depending on how much you travel, you might not be able to pay for all your flights with miles. But if you use an airline card and maximize your rewards, you’ll get at least some of them for free.

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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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