Free Tax Software for Military Members

If you are a military member looking for free tax software, then look no further. Militaryonesource.com offers free interactive software to complete your taxes through H&R Block. All you have to do is create a username and password on the Military OneSource Web site, and you will be redirected to the H&R Block tax center.

The software is incredibly easy to use, and allows you to e-file both your federal and state tax returns. It took about one hour to complete my entire tax return for both federal and state.

*TaxCut Basic Online® by H&R Block is free to active duty, National Guard, and Reserve service members and their families. To access this free service provided by the Department of Defense, you must be registered and logged in to the Military OneSource Web site.

What I've Been Doing Lately (3.25.08)

Las Vegas:

I just returned from a weekend in Las Vegas with my fiance! Incredible as usual (my third trip to Vegas)—especially if you like to gamble! Endless leisurely activities: Casinos, shows, pools, food, drinks, etc. Anything you’ve ever wanted to do you can do in Vegas. I highly recommend going if you haven’t already. I’ve stayed at Treasure Island, Tropicana, and now Mandalay Bay. All have their differing qualities, but all nice places nonetheless. Treasure Island is more of a family type atmosphere—meaning more activities for children. Tropicana is a throwback to the 1970’s era—decent overall, but not very extravagant. Mandalay Bay is the nicest casino/hotel out of the three. It is definitely classier and caters to the high rollers. In addition, I think it has the best pool of any casino/hotel on the Strip. The only catch is you’ll likely pay more money to stay, and its location is not the best (end of the Strip). Flights are cheap, and the drive from Phoenix is dangerously close!

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Camping:

Yes, it’s true. I am beginning my search for some decent camping/hiking equipment. With all the great mountainous areas and hiking trails around Arizona, I figure it’s about time to get outdoors. Please let me know if you have recommendations for equipment—REI, eBay, etc.

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Reading:

-The Five People You Meet in Heaven by Mitch Albom
-The Bible by God
-Where Have All the Leaders Gone by Lee Iacocca

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Buying:

I purchased a 4GB iPod yesterday from Target. I’ll let you know more details as I begin to add music. I was desperately in need of another one to occupy my workout hours. I’ve been using one of the original iPod’s and the software has been acting up—freezing, etc. Hopefully this one will work better!

How to Make Yourself More Interesting

The struggle to break the day to day routine of living within your comfort zone is something you can only accomplish through conscious undertaking. It is simply too easy to wake up everyday to the beat of the same drum. In fact, it’s human nature—we love our routine. I find myself struggling from this “disease” after four years of having my days and nights planned well in advance—day after day after day. However, I’m working to break the old routine and try different activities. In fact, I think stepping outside your comfort zone will make you a much more interesting person. In addition, you may find some things about yourself that you never knew before.

I have some very interesting people in my life, and I’ve taken some time to think deeply about what makes them interesting. Moreover, some of what you read is from personal experience that I’ve picked up along the way:

1. Read, Read, Read. Ok, I realize this is not a new idea. However, there is a bit of a twist. Read both fiction and non-fiction. Read magazines. Read your friend’s blogs. Read random people’s blogs that have taken the time to comment—they probably have something interesting to say. More importantly, read both for purpose and for pleasure. If you get stuck in academia land too much—meaning you are always marking a book, taking notes, etc, you never really allow yourself to take a new adventure. Getting lost in a good fiction novel can help spark many quality thoughts as well. A special thanks to my brother the Doc—Jared Reese—for suggesting I expand my reading selections. Cameron Schaefer wrote an excellent post related to reading called 7 Ways to Remember What You Read.

2. Learn to Develop Yourself Socially and Don’t Be Afraid to Take Risks. My good friend Andrew Ramsey is one of the most interesting people I know because he takes risks and is always seeking new adventures. His laundry list of cool activities include: Photography, traveling, hiking, camping, an African safari, eating organic foods, wine tastings, etc. Moreover, he has rightfully earned the nickname “The Renaissance Man” because he can literally talk to anyone about anything at anytime of the day no matter what. This is no a joke. He steps outside what an average person would deem “comfortable” and shows a genuine interest in other people. Instead of looking at someone as “weird,” he’ll ask them a deeper question like “That’s awesome, how did you get into that.” His social skills along with his willingness to take risks and be different make him the top dog on my list of “most interesting friends.”

3. Create a Network of Friends for Active Discussions. There are many different ways to attack this idea. The best suggestion I can offer is to have a focus area with friends for different topics. Have friends for business. Have friends to discuss things of a religious or spiritual nature. Have friends that just want to drink beer and watch sports. Find out what you like and don’t like. Having peer mentors can be a very powerful thing. After you have your categories, don’t be afraid to mix and match—discussions get interesting as your personal relationships grow.

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On a related note:
An area I’ve been thinking about deals with therapy. Ben Casnocha writes—Should Everyone Attend Therapy? This brings up an interesting argument in your personal development: Why not have a completely unbiased relationship with a professional? How much growth could come from interacting with someone on a purely professional level with no strings attached?

Savvy Tips for Tax Season

The following are some important but often overlooked concepts from Dennis McCafferty writing for USAA Magazine. I threw one of my own in at the end in regards to investing in individual stocks. Whether you prefer to do your own taxes or not, at least the following ideas should jog your memory and save you some money. I prefer to do my own taxes for a couple of reasons. 1) It is a great learning experience, and allows me to stay engaged with my finances, and 2) I am a finance geek!

Just Do It: Some 10 percent of taxpayer file after April 15, according to Cohesive, a tax-preparation and planning firm in California. But they might as well dump their money on the street. “At least 98 percent of the clients who come to us late pay more taxes,” says Cohesive founder and owner Karla Dennis, enrolled agent. “In several instances, we point out missing deductions, but there’s simply no time to gather the needed documentation to support them.” Bottom line here is start early. Don’t wait until the last minute.

Make Tax-Savvy Investments: Two relatively conservative investments can help give tax relief. A municipal bond fund is similar to a taxable bond fund, but all of the bonds in the fund are issued by a state, city or local government, and the fund generates income that is not subject to U.S. income tax. Some funds hold only bonds issued in one state, and if you live in that state, produce income that is exempt from both federal and state income taxes. This type of investment typically is suitable for someone in a higher tax bracket. A fixed annuity is a guaranteed investment. Similar to a certificate of deposit, or CD, a fixed annuity will pay a set, fixed interest rate. Depending on the annuity, the interest rate may reset or fluctuate periodically. From an income tax standpoint, the perk is that you will not pay income tax on the earnings until you withdraw them from the annuity.

Give and Receive: Donating old clothes, tools, books and items collecting dust to qualified charities may entitle you to a charitable contribution deduction. A recent change in the rules now requires that in order to take the deduction you must get documentation of the donation from the recipient organization, which also must be eligible for tax-deduction donations. “Most clients forget that non-cash donations are eligible,” says Ronald Park, managing partner of a Texas based accounting firm. “Cleaning out the closet once a year can save you not only space, but money.”

Deduct Moving Expenses: If you’re a member of the armed services, you probably know you’re entitled to deduct unreimbursed moving expenses. But make sure you do it. Civilians generally need to meet certain time and distance requirements to deduct moving expenses, but if you’re active duty and you move, those requirements can be waived.

Be Smart About College Savings: Many savings plans don’t have great tax advantages. If college savings is the primary goal for any savings account you open for a child, a 529 plan or Coverdell education savings account might be the best bet. “Forget savings accounts and bonds,” says Beth Wiggins, a Texas certified public accountant with tax and accounting firm BKD LLP. “Income from these accounts may be taxed at the parents’ tax rate until the child is 24. Instead, focus entirely upon college savings plans, such as Coverdell accounts or 529s, where earnings are never taxed if used for educational expenses.”

I’m going to add one of my own that wasn’t mentioned in the article, but can help defray some of your losses if you invest in individual stocks, while minimizing the taxes you will pay on your winners (if you choose to sell).

Hold Your Winners, Sell Your Losers: This idea runs contrary to what “feels good.” Mainly because you tend to think your losing stocks will “come back.” However, research shows routinely that you should do the opposite. Selling a winning stock before the one year mark means you’re going to pay short-term capital gains taxes (often taxed as ordinary income). Instead, hold your winners for the long run, and avoid this substantial penalty. On the flip side, sell your losers and write-off the loss. Take the deduction as long as you can swallow the psychological pain. I’ve done this before on a terrible decision I made a couple of years ago. Long story short, at least I got a tax deduction after the stock lost 80% of its value.

More tips from USAA here

A Quote from the Index Fund Advisors

With all the market turmoil of late, I feel a reminder quote from the Index Fund Advisors regarding the importance of diversification and trying not to “time” individual stocks is worthy of revisiting.

“If there’s 10,000 people looking at the stocks and trying to pick winners, one in 10,000 is going to score, by chance alone, a great coup, and that’s all that’s going on. It’s a game, it’s a chance operation, and people think they are doing something purposeful…but they’re really not.”

-Merton Miller, Nobel Laureate and Professor of Economics, University of Chicago, Transcript of the PBS Nova Special, “The Trillion Dollar Bet”

One Difference Between Leaders and Managers

A short blurb from The 7 Habits of Highly Effective People calendar explains one difference between leaders and managers:

“Effective management is putting first things first. While leadership decides what “first things” are, it is management that puts them first—day-by-day, moment-by-moment. Management is discipline and the act of carrying it out. The word “discipline” derives from “disciple,” which means one is a disciple to philosophy, principles, values, an overriding purpose, a subordinate goal, or a person who represents that goal.”

Which would you rather be: A leader or a manager…why not strive to be both?

Cameron Schaefer explains some of the differences between leaders and managers here