DEAR GRADUATE

As it is college graduation time I thought I would reprint some advice to recent graduates that I had given in a post from a couple of years back.

 

Dear Graduate -

 

1.  Claim Single-1, or Single-0, on your Form W-4 for federal and state withholding.  Do NOT claim more than 1 exemption.

 

2.  Participate in your employer’s 401(k) or 403(b) plan.  If cash-flow permits, contribute the maximum, which for 2014 is $17,500.  If you cannot contribute the maximum try to contribute at least enough to qualify for the maximum amount of any employer matching contribution.  If your employer offers a ROTH 401(k) or 403(b) option choose this option.  As an alternative, if you are contributing the maximum put 50% in a “traditional” account and 50% in a ROTH account.

 

3.  If you contribute toward the cost of employer-paid group health insurance premiums via payroll deduction, and you are offered an option, elect to have your contributions be treated as “pre-tax”.

 

4.  Participate in your employer’s medical expense Flexible Spending Account (FSA).  Be conservative and start with $1,000.  You can increase your contribution in subsequent years once you get a handle on your annual out-of-pocket medical expenses.

 

5.   If you have any cash from graduation gifts left over open a ROTH IRA account and use this money to fund your 2014 contribution.  The maximum you can contribute to an IRA, “traditional” and ROTH combined, for 2014 is $5,500.

 

6.  Take an empty coffee can, or other form of “piggy bank”, and put it in your bedroom.  Each week put $10, $20, or $50 in this “bank” (if you choose $20, but $20 in each week).  On January 2nd of 2015 take the money that has accumulated in this “bank” and contribute it to your ROTH IRA for tax year 2015.  Continue this practice for 2015 and subsequent years. 

 

And if you are thinking about becoming a tax preparer I offer my advice in my new book SO YOU WANT TO BE A TAX PREPARER.

 

In this book I discuss in detail -

 

·            LEARNING HOW TO PREPARE TAX RETURNS

·            THE PTIN

·            TAX PREPARER MEMBERSHIP ORGANIZATIONS

·            CONTINUING PROFESSIONAL EDUCATION

·            PROFESSIONAL RESPONSIBILITY – ETHICAL PRACTICES 

·            BUILDING A PRACTICE

·            USING A BLOG TO PROMOTE YOUR TAX PRACTICE

·            GETTING A CREDENTIAL

·            STRUCTURING YOUR TAX PRACTICE

 

The APPENDIX includes copies of a Code of Ethics, Standards of Professional Conduct, an Engagement Letter and the TAX PROFESSIONAL’S ONLINE RESOURCE GUIDE.

 

This book can also provide help to tax preparers who would like to expand their practice.

 

The cost of this book is only $5.45 delivered as a pdf email attachment, or $9.45 for a print version sent via postal mail.

 

To order your copy of this book send your check or money order payable to TAXES AND ACCOUNTING, INCORPORATED, and your email or postal address, to –

 

SO YOU WANT TO BE A TAX PREPARER

TAXES AND ACCOUNTING, INC

POST OFFICE BOX A

HAWLEY PA 18428

 

TTFN