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Marginal Tax Rate VS Effective Tax Rate – Why You Need to Know the Difference

Marginal vs effective tax rates

Most of us have no idea what either our marginal or effective income tax rates are.

They only seem to matter at income tax filing time, usually appearing as supplemental numbers in a computer generated income tax return.

One of the reasons we tend not to track these numbers is because they’re calculations, which for the most part, have no immediate relevance to us, but also because of complications in calculating them.

Because we have a progressive income tax system — tax rates rise with income — and because there are multiple taxes, the actual numbers can be difficult to calculate.  In addition, each rate can change from one year to the next or from complications in the tax code.

We have two tax rate classifications then, marginal tax rate and effective tax rate.

What is the marginal tax rate and the effective tax rate and how and when do they apply?

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Four Simple Ways to Cut Household Expenses

Jean Chatzky
The following was written by none other than personal finance expert Jean Chatzky.  When I got word that she was interested in sharing an article with my readers I screamed (well typed) a big YES in response.

I recently wrote a short report — not quite an ebook, not quite a blog post — about how you can save money on household expenses

I did it to offer up the tips I use in my own home, and so far, the downloads have been off the charts.

This is clearly something we all care about.

When Glen asked me to guest post, I knew that pulling my favorite tips from this report would be a big hit.

In writing the document, I focused on the areas where we all seem to spend the most money — things like electricity, cable/satellite TV, and cell phone bills.  (I also talked extensively about lowering your heating bills — the report was released in February — but I’m hoping we’re over that hurdle at this point, so I’m not going to address it here.)

Below, a few of my favorite tips for cutting your monthly expenses.

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Free Tax Day Snacks, Giveaways and Deals

Tax day deals and freebies

You got all your forms and receipts together to tackle your taxes.

Did you file everything yet in or are you still procrastinating?

If you are really one of those last minute folks then you better make sure your return is in either electronically by day’s end or post-marked by the end of the day on April 15th (expect the post office to be crowded).

To help everyone get over the tax-day malaise, there are a number of stores that are offering up free tax day snacks, giveaways, and deals.

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To Itemize or Take the Standard Deduction, That is the Question

Itemize vs standard deduction

When life becomes more complicated, so do your taxes.

As you claim dependents, purchase a home, or are involved in a major loss or theft you can claim specific items on your taxes that will reduce your tax burden.

Other reasons such as owning your own small business, earning money in more than one state, or if you have investments or property that can be claimed as a loss then your taxes become slightly more difficult to file.

Most single people will file a Form 1040-EZ, but if you have any type of deduction that is greater than the standard deduction it may be best to file using a Form 1040.

So when should you itemize on your taxes?  The following will provide some major reasons for itemizing.

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Where’s My Tax Refund? How to Check the Status of Your Tax Refund

where's my tax refund

When you are expecting a tax refund, it is normal to file a little bit early.

The very next thing you say once you file is “where’s my refund?”  We can’t wait to get that money owed to us.

Indeed, many people have already received their tax refunds.

When you get refunded depends on two main factors:

  1. How you filed (mail or e-file)
  2. How you receive your refund (paper check or direct deposit)

If you mail in your tax return, and opt to receive your refund in the form of a check from the United States Treasury, it can take as long as two months or more to see your tax rebate.

This is the combination that takes the longest.
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File Later Or Fix A Mistake? – Extension of Time to File Taxes vs. Amended Tax Return

Extension of time to file vs amended return

This year, you have until April 15 to file your tax return (some years the date is off).

But that doesn’t mean that you’re ready to file.

You might want a little more time to get things together, or you might need to make changes to an already-filed return.

It is important to understand the difference between a tax extension and an amended return.

Read on and you’ll know for sure which of these 2 choices is right for you.

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Don’t Miss These if You Make Money Blogging – Blogger Tax Deductions

Blogging tax deductions

At first glance, it may not seem that you are spending a great deal on your blogging endeavors.

However, the fact is that blogging does cost money.  And, if you are making income from your blogging, you might want to offset some of that with the help of tax breaks for your costs.

Before you go claiming tax breaks, though, it is a good idea to double check to make sure that the items you claim truly are related to your blogging efforts.

If you are looking for some blogger tax deductions, here are some things to consider:

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