BANKING & FINANCE Published by Anton Community Newspapers • March 5 - 11, 2014
MORTGAGE SHOPPING
Insider tips and tricks to help YOU get the best deal plus...
THE ‘KIDDIE TAX’ Don’t let the cute name fool you
YOUR WILL
More important than you think
Our students save more, borrow less. 222-05 56th Avenue, Bayside, NY 11364
QCC.CUNY.EDU/ADMISSIONS
111720
2C
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
Shopping For A Mortgage
“It’s the smartest thing we’ve ever done.”
BY ANTON NEWS STAFF
editorial@antonnews.com
– Steve and Sonny Hurst
A charitable gift annuity (CGA) with American Associates, Ben-Gurion University of the Negev offers you high fixed-rate income for life and amazing tax benefits. It also supports exceptional education for Israel’s young people, and forges pioneering research in medicine, renewable energies, water resource management, desert agriculture, and more.
FIXED LIFETIME RATES Age
Rate
Tax Free*
65
6.0%
69.6%
70
6.5%
72.8%
75
7.1%
75.4%
80
8.0%
77.9%
85
9.5%
81.8%
90
11.3%
84.0%
To learn more or to request a CGA rate illustration, contact newyork@aabgu.org or call 646-452-3703.
1001 Avenue of the Americas, 19th Floor New York, NY 10018 newyork@aabgu.org www.aabgu.org
111377
*In the month you use cash to establish a gift annuity, a final calculation is made determining the portion that will be paid to you tax-free.
Shopping around for a mortgage will help you get the best financing deal. A mortgage — whether it’s a purchase, a refinancing, or an equity loan — is a product, just like a car, so the price and terms may be negotiable. Compare the costs involved in obtaining a mortgage. Shopping, comparing, and negotiating may save you thousands of dollars. Obtain information from several lenders Home loans are available from several types of lenders — thrift institutions, commercial banks, mortgage companies, and credit unions. Different lenders may quote you different prices; contact several lenders to make sure you’re getting the best price. Whether you are dealing with a lender or a broker may not always be clear, some operate as both. And most brokers’ advertisements do not use the word “broker.” Therefore, be sure to ask whether a broker is involved. This information is important because brokers are usually paid a fee for their services. Obtain all important cost information Be sure to get information about mortgages from several lenders or brokers. Know how much of a down payment you can afford, and find out all the costs involved in the loan. Knowing the amount of the monthly payment or the interest rate is not enough. The following information is important to get from each lender and broker: Ask for a list of current mortgage interest rates and whether the rates are the lowest for that day or week. Ask whether the rate is fixed or adjustable. Keep in mind that when interest rates for adjustable-rate mortgages go up, generally so do the monthly payments. If the rate quoted is for an adjustable-rate mortgage, ask how your rate and loan payment will vary, including whether your loan payment will be reduced when rates go down. Know the loan’s annual percentage rate (APR). The APR takes into account not only the interest rate but also points, broker fees, and certain other credit charges that you may be required to pay, as a yearly rate. A home loan often involves many fees, such as loan origination or underwriting fees, broker fees, and settlement (or closing costs). Every lender or broker should be able to give you an estimate of its fees. Many of these fees are negotiable. Some
fees are paid when you apply for a loan, and others are paid at closing. In some cases, you can borrow the money needed to pay these fees, but doing so will increase your loan amount and total costs. Some lenders require 20 percent of the home’s purchase price as a down payment. If a 20 percent down payment is not made, lenders usually require the homebuyer to purchase private mortgage insurance (PMI) to protect the lender in case the homebuyer fails to pay. When government-assisted programs like FHA (Federal Housing Administration) or VA (Veterans Administration) are available, the down payment requirements may be smaller. If PMI is required, ask what the cost of the insurance will be and ask how much your payments while be when PMI is included. Have the lender or broker write down all the costs associated with the loan. Then ask if the lender or broker will waive or reduce one or more of its fees or agree to a lower rate or fewer points. You’ll want to make sure that the lender or broker is not agreeing to lower one fee while raising another or to lower the rate while raising points. If your credit report contains negative information that is accurate, but there are good reasons for trusting you to repay a loan, be sure to explain your situation to the lender. If your credit problems cannot be explained, you will probably have to pay more than borrowers who have good credit histories. Ask how your credit history affects the price of your loan and what you need to do to get a better price. Whether you have credit problems or not, review your credit report for accuracy and completeness before you apply for a loan. To order a free copy of your credit report, visit www.annualcreditreport.com or call 877-322-8228.
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
Understanding The ‘Kiddie Tax’ For something whose nickname sounds so innocent, the “kiddie tax” certainly can wreak havoc on unprepared taxpayers’ yearly returns. Congress first introduced the kiddie tax as part of the Tax Reform Act of 1986 to discourage wealthy parents from sheltering their investment income in accounts under their children’s names, thereby avoiding paying taxes on the amounts. The rules have been tweaked periodically ever since. Although the kiddie tax once applied only to the unearned income of children under 14 (hence the nickname), it now impacts all children under age 19 (as well as full-time students under 24), provided their earned income does not exceed half of the annual expenses for their support. Moreover, the kiddie tax is not just a wealthy person’s problem: Any outright gifts parents or grandparents bestow on young children, whether to avoid triggering the gift tax or simply out of generosity, could actually be generate investment earnings that would be subject to the kiddie tax if they exceed a threshold amount. Here’s a primer on how the kiddie tax works and whom it impacts:
As it does with adults, the IRS differentiates between income children earn (paper routes, summer jobs, etc.) and unearned investment income they receive such as interest, dividends and capital gains — usually by way of accounts opened in their names by parents. Taxation of the first $1,000 of a child’s unearned income is generally offset by the $1,000 standard tax deduction for dependents and thus won’t be taxed; the next $1,000 is taxed at the child’s own income-tax rate (e.g., it’s 10 percent for taxable income up to $8,925). However, all unearned income
over $2,000 is taxed at the parent’s marginal tax rate, which can be as high as 39.6 percent for married couples with taxable income over $450,000. There are two ways to report your child’s investment income to the IRS: File a separate return for your child using IRS Form 8615; or include it on your own tax return, using IRS Form 8814 — the latter only works if they had no earned income to report. The tax owed will be the same either way. Important note: Although including your children’s investment income on your return may be more convenient, doing so could increase your adjusted
gross income so much that you become subject to the alternative minimum tax or ineligible for certain income-based deductions and credits. For example, eligibility for the American Opportunity Tax Credit begins phasing out for individuals whose modified adjusted gross income exceeds $80,000 ($160,000 for married couples). Other kiddie tax rules: • To be considered full-time students, children must attend school full time during at least five months of the year. • The kiddie tax does not apply to children who: are 19 to 23 and not fulltime students; provide more than half of their own support from earned income; are over 24 and still dependents of their parents; or under 24 but married and file a joint tax return. These children are all taxed like adults at their own tax rate. Remember, gifts themselves are never taxable to the recipient. If a gift generates unearned investment income, however, that’s when taxation comes into play. Also, any gifts over $14,000 per individual, per year, will trigger the gift tax – although most of us will never come close to the $5.25 million lifetime gift exemption. For details on tax filing requirements for children, see IRS Publication 929, “Tax Rules for Children and Dependents.”
111628
BY JASON ALDERMAN
editorial@antonnews.com
3C
4C
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
Your Will: The Overlooked 1.00%* APY Item On Your Bucket-list 5-YEAR ANNIVERSARY SPECIAL
STATEMENT SAVINGS ACCOUNT
*$500 MINIMUM DEPOSIT. Offer Available for Consumer and Business Accounts.
1.10%* APY 13 MONTH CD
*$500 MINIMUM DEPOSIT. Offer Available for Consumer and Business Accounts. Penalty may be imposed for early withdrawal. Annual Percentage Yield (APY) Effective as of 2/6/14.
1.40%* APY 30 MONTH CD
*$500 MINIMUM DEPOSIT. Offer Available for Consumer and Business Accounts. Penalty may be imposed for early withdrawal. Annual Percentage Yield (APY) Effective as of 2/6/14.
LET US BE YOUR OWN PERSONAL BANKER • • • •
Business Accounts Totally Free Checking** Competitive CD Rates Free ATM Banking with Our Hanover ATM/ Debit Bank Card Anywhere in the United States*** • Residential Mortgage Program • Commercial Loans • Small Business Loans • Free Business Checking
Why this document is so very important BY GINNY GRIMSLEY
editorial@antonnews.com
Of the trendy terms to come around in the past decade, “bucket list” remains among the most useful, says retirement planning expert Jeff Gorton. “As a neologism, I hope it endures because it reminds us of how precious our time is — and that it’s important to plan wisely,” says Gorton, a certified public accountant and certified financial planner.
“Unfortunately, after some have listed their items and even checked a few things off, they forget about one important item that really counts after they’ve ‘kicked the bucket’ — their will.” Only about 40 percent of adults have a will, which is probably due to people not wanting to be reminded of their own mortality and that life will go on without them, he said.
see WILL on page 5C
Published by Anton Community Newspapers KARL V. ANTON, JR. • Publisher, 1984-2000 ANGELA SUSAN ANTON • Publisher MICHAEL CASTONGUAY • President & COO FRANK A. VIRGA • EVP of Sales & Operations JOHN OWENS • Editor in Chief EDITH UPDIKE • Managing Editor CHRISTY HINKO • Editor TOMMY VON VOIGT • Creative Director IRIS PICONE • Classified Manager JOY DIDONATO • Circulation Manager
For More Information Contact Diane C. Duel dduel@HanoverCommunityBank.com
ON THE COVER (Photo by Tommy Von Voigt)
OPEN SATURDAY 9AM-1PM ATM - 24 HR. HOURS
132 East Second St., Mineola NY 11501 Phone: 516-747-8282 • Fax: 516-742-5867 advertising inquiries: advertising@antonnews.com circulation inquiries: subscribe@antonnews.com editorial submissions: editorial@antonnews.com
2131 JERICHO TPKE., GARDEN CITY PARK
516-248-4868
www.hanovercommunitybank.com **Minimum opening deposit $100.00. All checking accounts with interest are subject to minimum balance requirements. The customer is reponsible for check printing charges. The Bank reserves the right to cancel or modify this offer at anytime. ***Only the first 5 transaction fees incurred per statement cycle at any ATM will be refunded. After the 5, the fees incurred at a non-proprietary ATM will apply.
111596
Nicolas Ruibal pauses briefly after a visit to the New York Stock Exchange
© Long Island Community Newspapers, 2014
5C
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
>More
®
Great Banking Right In Your Neighborhood. WILL from page 4C
We’re the local community bank that always gives you >more®! >MORE® ATMS >MORE® Branch Locations >MORE® Banking Hours
>MORE® Sunday Banking >MORE® Convenience >MORE® Business Banking
For more information, call (877) 786-6560 or visit myNYCB.com
Bank Anywhere You See NYCB! Over 200 locations throughout NY/NJ. ©2014 New York Community Bank- Member FDIC
110844
“But what’s the alternative? If you die without one, the state decides what becomes of your property, without regard to your priorities,” said Gorton, who also advocates his clients make use of a written income plan (WIP), a living document that helps organize financial priorities. “Why not enjoy the fact that a will is an instrument of power? You get to decide who gets what.” Many people don’t understand how wills work. Gorton breaks down wills into four basic parts: • Executors — Most wills begin by naming an executor, the person responsible for carrying out the wishes in the will. Duties include assessing the value of the estate, gathering assets, paying inheritance tax and other debts, and distributing assets among beneficiaries. • Guardians — A will allows you to designate a guardian for your minor children. Whomever you appoint, you will want to make sure that the individual is able and willing to assume the responsibility. If you die without naming a guardian, the court will decide who takes care of your children. • Gifts — Identifies those to whom you wish to give gifts of money or specific possessions, such as family heirlooms. You can also specify conditional gifts, such as a sum of money to a young daughter, but only when she reaches a certain age. • Estate — Your estate encompasses everything you own, including property, investments, cash and possessions. “You’re not required to have a professional write a will for you, but I highly recommend you get certified help because these documents are often contested by people who are unhappy with the decisions you made,” he said. “After working a lifetime for your assets, you deserve to have them go where you want after you’re gone, and your family will be grateful to you for not leaving them with the headache of trying to sort out your estate.”
Equal Opportunity Lender
6C
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
Deadline Looms: Free Tax-Filing Assistance BY ANTON NEWS STAFF
editorial@antonnews.com
Qualifying taxpayers planning to take advantage of Bethpage’s VITA program need to bring the following materials with them for review: 2013 tax package of wage and earnings statements (Form W-2), all interest and dividend statements (Form 1099-INT), all other income and expense information, a
copy of last year’s Federal and State returns if available, bank routing and account numbers for Direct Deposit, total paid for day care and provider’s tax ID, social security cards for you, your spouse and dependents and as well as photo identification. To file taxes electronically on a
married filing joint tax return, both spouses must be present. For information on VITA and paperwork needed, visit Bethpage’s “Volunteer Income Tax Assistance Program” page located at www. bethpagefcu.com/community/ events/vita or call 800-628-7070.
111614
The Bethpage Federal Credit Union’s Volunteer Income Tax Assistance (VITA) program helps eligible families prepare their tax returns for free. Through April 12, more than 100 IRS-certified volunteers, including bilingual tax assistors, will be available to help taxpayers who have incomes of $52,000 and below file their 2013 tax returns. The VITA program is open to all eligible Long Islanders, including non-Bethpage members. Services are available in all Long Island locations including • The Farmingdale location, 1033 Route 109, on Wednesdays from 5 to 7 p.m. and Saturdays from 3 p.m. to 6 p.m. • The Hempstead location, 170 Fulton Ave., on Wednesdays 6 to 8 p.m. and Saturdays 3 to 6 p.m. • The Massapequa location, 6257 Sunrise Highway, on Wednesdays 6 to 8 p.m. and Saturdays 3 to 6 p.m. • The Roosevelt location, 405 Nassau Rd., on Wednesdays 6 to 8 p.m. and Saturdays 3 to 6 p.m. • The Westbury location, 750 Old Country Rd,. on Wednesdays 6 to 8 p.m. and Saturdays 3 to 6 p.m.
BANKING & FINANCE - ANTON COMMUNITY NEWSPAPERS - MARCH 5 - 11, 2014
7C
MAKE SURE THE REST OF YOUR LIFE IS THE
BEST OF YOUR LIFE.
1.35 2.25
%
APY*
3 Year Bump Up IRA CD**
%
APY*
5, 6, or 7 Year IRA CD
* Annual Percentage Yields (APYs) are effective January 27, 2014 and are subject to change without notice. Minimum deposit is $500. There is a substantial CD penalty and IRS penalty for premature withdrawals. FDIC regulations apply.** You have the one-time option, at any time during the term of this CD, to change the interest rate to the rate then offered by the Bank for the same term for the balance of the original term.† Limit one gift per IRA account holder. Offer available for new IRA contributions only. Offer is good through April 15, 2014. Minimum deposit to qualify for gift is $2,000 and CD term must be at least one year. The bank reserves the right to substitute gifts of comparable value and quality. Check www.RidgewoodRewards.com for latest rewards item selection.*** Odds of winning depend upon number of entries. You do not need to be a bank customer to enter. Must be 18 years old or older to participate. One entry per person during the contest period (February 12 - April 15, 2014) is permitted. Drawing will take place on May 1, 2014. Entrants need not be present to win. No purchase necessary to win; entry forms are available at any Ridgewood Savings Bank branch and are available during normal branch hours. To enter by mail, write name, address and phone number on a 3”x 5” index card and mail to: Marketing Department, Ridgewood Savings Bank, 71-02 Forest Avenue, Ridgewood, NY 11385. Mailed entries must be received by 12pm on April 15, 2014. Employees, Trustees and agents of Ridgewood Savings Bank, their immediate families and those living in the same household of any of the aforementioned individuals are not eligible to participate. Offer may be withdrawn at any time. AN
111170
IRA_4.25 x 11.25_02.20.indd 1
2/20/14 3:18 PM
111652
Open an IRA today. Deposit $2,000 or more and receive a free luggage tag or 100 Ridgewood Reward points.† Bring this ad to one of our branches and you could win a $500 JetBlue gift card.***
LIFESTYLES YOU DESERVE
THE REGENCY OPEN HOUSE | SUNDAY, MARCH 9 | 11 AM – 3 PM | 260 CENTRAL AVE, LAWRENCE | Luxury starts from the moment you pull up to its breathtaking pillared entrance and are greeted by the valet and 24 hour doorman. An oasis of relaxation where you will enjoy the finest things life has to offer; the amenities of a 5-star hotel, with the comforts of a well-appointed home. Just steps from the Five Towns, the Village of Lawrence, minutes from NYC, beaches, airports, shopping, fine dining, houses of worship, the Lawrence Country Club, Yacht Club, golf courses. Contact: On-Site Sales Office 516.592.5670 | www.regencyatlawrence.com
GENERAL’S ROW 325 ELLINGTON AVE, GARDEN CITY | General’s Row, an exclusive community of 19 Classic Brick Colonial Homes is nestled within the Avalon Garden City Community. These fully updated 1940’s homes include luxurious features, fixtures, appliances, finishes and amenities. As homeowners you will have exclusive use of the Avalon Garden City Clubhouse, sparkling swimming pool, state of the art fitness center, children’s play area, outdoor grilling terrace and club room. Contact: Catherine Gerspach, 516.238.2771 | Katarzyna Kamer, 917.548.7106 | www.elliman.com/generalsrow.
111609
*THE COMPLETE OFFERING TERMS ARE IN AN OFFERING PLAN AVAILABLE FROM THE SPONSOR. | 110 WALT WHITMAN ROAD, HUNTINGTON STATION, NY, 11746. 631.549.7401 | © 2014 DOUGLAS ELLIMAN REAL ESTATE. ALL MATERIAL PRESENTED HEREIN IS INTENDED FOR INFORMATION PURPOSES ONLY. WHILE, THIS INFORMATION IS BELIEVED TO BE CORRECT, IT IS REPRESENTED SUBJECT TO ERRORS, OMISSIONS, CHANGES OR WITHDRAWAL WITHOUT NOTICE. ALL PROPERTY INFORMATION, INCLUDING, BUT NOT LIMITED TO SQUARE FOOTAGE, ROOM COUNT, NUMBER OF BEDROOMS AND THE SCHOOL DISTRICT IN PROPERTY LISTINGS ARE DEEMED RELIABLE, BUT SHOULD BE VERIFIED BY YOUR OWN ATTORNEY, ARCHITECT OR ZONING EXPERT. PHOTOS SHOWN MAY HAVE BEEN MANIPULATED. EQUAL HOUSING OPPORTUNITY.