<p>"I have some money invested in the stock market. Up to how much can I have before they take it?"</p>
<p>For schools using the FM and FAFSA, exactly 35% starting at 3 dollars. They will also take 50% of any earnings after $2,550. </p>
<p>Other schools will look at 25%.</p>
<p>I wrote some of this before finishing all of the reading so I apologize in advance for repetitive suggestions.</p>
<p>There are a couple of things that I would suggest considering. Kid's money is treated differently than parent's money. It is not wrong to have kids spend their money for their things, and it makes sense to spend that money before you spend parents money. If a student was going to need dental work, or a new computer, it might make sense for them to pay cash from their savings before filling out the fafsa forms. There is no advantage to having a sizable savings account for Fafsa. There is a long term advantage to having credit card and other consumer debt reduced. Accordingly, it might make sense to reduce family savings which is a consideration to eliminate debt which is not.</p>
<p>Don't do anything wrong, morally or illegally, but do consider the implications of all your money decisions. It would not make sense to state you have $10,000 in savings if the next day you were spending $3,000 on eye surgery or on a car. Use your moral compass on this, but I think my suggestions are acceptable.</p>
<p>For those who are particularly clever and not hindered by moral judgement, perhaps you could consider who is hurt when people who can afford college (but don't want to) get funds that could have gone to others who needed the aid.</p>
<p>Xiggi: You quoted me in your first sentence. I was replying to you.</p>
<p>When I said "TG method is workable," Please do not take it that it will work for everyone. The method, as TG points out, is of limited value to even a smaller number of people. But it is workable. </p>
<p>Assets, taxes, FAFSA, Profile, and all the other stuff that goes with money is not a Yes or No function but is algorithmic, with a healthy dose of "emotion." </p>
<p>Can anyone help Amatricia, in thread "FAFSA and Life Estate" ?</p>
<p>GL.</p>
<p>Xiggi, got it and responded back.</p>
<p>Taxguy, Wait. Let me get this right. A few months ago you were literally spitting about Syracuse giving financial aid to too many low income students. Now, you're thinking up ways to scam the system to help yourself so YOU don't have to pay? Hmmm. Interesting how you dislike the "system" so much when it helps others but are the first in line explaining ways to juggle the loopholes to make it work for YOU. Oh Lordy, give me patience.</p>
<p>Carolyn, How can you say that I am juggling the system to make it work just for me? I have given advice, that I myself can't benefit from, for other people to use! This is why I posted the information on CC.</p>
<p>Moreover, hating the way the system works is perfectly coherent in searching out ways to get around the system legally.</p>
<p>If you hate something, do you let that thing simply hit you over the head, or do you try to do something about it? </p>
<p>I am not one to put up with things that I dislike. I usually fight for my beliefs, write OP-Ed pieces, develop groups to challenge legislation etc. Sorry, it's just my nature to actively resist what I consider oppressive or wrong in any legal way that I can imagine.</p>
<p>As you most aptly said, "Oh Lordy, give me patience."</p>
<p>"For schools using the FM and FAFSA, exactly 35% starting at 3 dollars. They will also take 50% of any earnings after $2,550. </p>
<p>Other schools will look at 25%."</p>
<p>I was considering putting money into my scottrade account, but maybe I should hold off till my FASFA is filed in Jan.?</p>
<p>It looks like he has some tips that while it definitely involves working the system- are apparently legal
bookcloseouts.com has Lowering your taxes- big time for $5.99 a saving of 65% , that folks might want to look at, particulary if they are self employed. Since self employed business owners often seem to be paying more than they can afford for college expenses, legal ways to reduce that are at least worth a look.
<a href="http://www.entrepreneur.com/article/0,4621,306874,00.html%5B/url%5D">http://www.entrepreneur.com/article/0,4621,306874,00.html</a></p>
<p>
[quote]
What other deductions do people not typically know about?
Botkin: As an employee, you have to pay [taxes on everything]. As a self-employed person, you don't pay tax until all your deductions are over. So [if you're an employee making] $60,000 a year, you've got to pay Social Security on 15.3 percent of $60,000. You've got to pay income tax on $60,000, regardless of your employee business expenses. [But] if you're self-employed--let's say you have $40,000 of expenses on that $60,000, you only pay tax on $20,000. You pay tax on your net. See the difference?</p>
<p>So what are some things you can do? If you have a child and you want to send them to college, that isn't deductible. And if you pay for their wedding, is that deductible? The answer is no. But if you were to hire your children in your business and pay them [the same] wage you'd pay an assistant, that's deductible. And if they use that money to pay for their own college or their own wedding or their own car, aren't you in essence getting a deduction for those things?</p>
<p>And by the way, children under 18--if you hire them in a sole proprietorship business--are exempt from Social Security and federal unemployment taxes, and the first $4,700 they made in 2002 is exempt from income tax. Result? You get a deduction, and they get that money tax-free.</p>
<p>So to protect yourself, you need to do the same paperwork as you would a normal employee?
Botkin: Good point. You want to have things like time sheets or a tax diary showing what your kid did. So for example, you might say Matthew, my son, sorted files and made 3-by-5 cards for four hours on February 3. That shows what he did, when he did it and how long he worked.</p>
<p>You also want to pay by check--none of this under-the-table nonsense, because [checks] establish a payment from you to your child to your child's bank account. You want to have the appropriate paperwork done. There are W-2s you have to file once a year and 940s and 941s for unemployment and Social Security. But I recommend using a payroll service, because people don't want to do all this paperwork. They will do all the payroll, all the forms, all the filings. You also want to have a contract for services showing you hired your kids and what you're paying them, a normal contract like any other employee..
[/quote]
</p>
<p>allow me to answer to you, istoomuch!</p>
<p>Darn. You made me log in again.
Itstoomuch for you to understand how UGTM/UTMA works, FAFSA, taxes, and reading my disclaimers?</p>
<p>It is not too much for ME to understand how UTMA, and UGTM -I assume you might mean UGMA- FAFSA, and taxes do work. On the other hand, you should not be so quick to assume others do not understand the subject because they are reluctant to blindly endorse questionable tactics. </p>
<p>*for some, it will SAVE them a lot of MONEEEEEY. But probably not you. *</p>
<p>Again, do not be so quick to reach erroneous conclusions. There is quite a difference between savvy tax planning and using questionable strategies. I have already described -in details- which one I objected to. Had you read my post before jumping onto the keyboard, the difference would have been quite clear.</p>
<p>This said, there is something I clearly do not understand, and that is your last statement: *"Assets, taxes, FAFSA, Profile, and all the other stuff that goes with money is not a Yes or No function but is algorithmic, with a healthy dose of "emotion." *</p>
<p>No, I do mean what I wrote. Please do not take the my previous post personally but look at the post, generally and generically to everyone. </p>
<p>Too many points to cover. But let me say this; Some money questions are answered emotionally but asked logically. Just look at some of the replies to TD and my posts. But when I read books and listen to people in money, they ask questions logically and answer that question logically, even though I emotionally do not agree to their answer. </p>
<p>Disclaimer upfront: I am led to believe that the following is true. I am NOT absolutely positive so YOU, the reader, must make your own investigations. I am not giving any advice or guidance to you or to any readers. </p>
<p>My Definitions: Kid's Money. A minor cannot make knowledgeable financial decisions and thus Kid's Money must be in a vehicle such as UGMA/UTMA, joint, custodian and a bunch of others that I am not familiar with, but perhaps work. Kid's Money, is reported for tax purposes under the Kid's Taxpayer 's Identification Number (TIN). Kid's Money is identified by kid's TIN. { Yes, I know that there are some financial institutions that allow you to solely open an account in a minor's name and SS#. I even had a brokerage account and bought stock ($100worth) when I was 14. I don't know if minor sole ownership is legal, but the institutions that I work with, says, minor with some type of custodian}</p>
<p>Asset Shifting does not mean Asset TRANSFERENCE. By this I mean that asset shifting is done by converting one type of asset to another type of asset; such as- cash to mutual funds, mutual funds to gold, gold to property, cash to pay debt, cash to IRA, cash to 401(k) and even to CVI and annuities. This shifting is done through the same TIN. </p>
<p>Transference, means moving the asset from one TIN to another TIN. If the money or asset is under the kid's TIN, then there cannot be "transference" without ownership, tax, and FAFSA repercussions.</p>
<p>Xiggi: Again, do not take this personally and I apologize that if you did.
Re Post #23. </p>
<p>Previous disclaimers in post #50, still hold.</p>
<p>Asset shifting to CVI and Annuities is not a questionable technique. It is done all the time and I will make a blanket statement to prove my point. If YOU participate in Social Security, IRA, 401(k), Pension, YOU are asset shifting to save taxes today in hopes that you will 1) have some type of retirement income and/or 2) postpone or reduce taxes to a point where taxes to you is less tomorrow than what it is today. </p>
<p>Many years ago, (kid was 8-12, he's now 20) an insurance agent selling CVI) made a proposal to me concerning assets for college. I invited him into my home, listened, and politely said, "no thanks." Because, 1) the cost for the CVI was greater than the benefit in asset shifting; 2) Too many variables in the control of the insurance company and not enough control for me; and 3) I didn't think my assets or kid's money was great enough to make such an exotic shift. </p>
<p>I revisited the proposal 4 years ago when I did our first FAFSA. On analyzing the assets and income in the FAFSA, I realize that the insurance agent was correct in his concept. If he had a low cost program, the savings to my and kid is A LOT of $$$$$$$$$$$$$$$$$$$$. However, if I implemented a CVI or annuity program near the start of our son's college years, the program would COST ME a lot of Moneeey. </p>
<p>So if your child is young, you have reasonable expectations that your and child's assets will grow considerably, "it will SAVE them a lot of MONEEEEEY,"</p>
<p>and if your child is near college age, then "probably not you."</p>
<p>GL</p>
<p>In Post #50.
There is another strategy. Risky but again doable.</p>
<p>My disclaimers is again repeated. For discussion only, no advice given. I am not an advisor.</p>
<p>For the newbies: FYI, We are 100% EFC. A "fair" institutional grant from CMU but no where near equal to a competitive school's offer. Our son's total student debt load (PLUS and Unsub. Stafford) is many times that of the "average" as published by CMU and USNWR national debt burden. </p>
<p>I made a tactical financial error in the past 3 years. I should have taken loans upto 100% of the COA. I figure that this "emotional" error cost us at least a couple of $10ks. Mathematically I knew better. </p>
<p>Thought Questions
?1. Do you know What this error is (program) and Why this error of judgement is costly?</p>
<p>?2. Is it wrong to use Government programs to our benefit, when that program is advertised by direct mail, sponsers of this board, solicited by our bank, and promoted by the financial institutions setup by our fine Government?</p>
<p>GL</p>
<p>Istoomuch, thank you for taking the time to answer in such detailed way. It is very much appreciated.</p>
<br>
<blockquote> <p>IRA, 401(k), Pension>></p> </blockquote>
<br>
<p>Ah...but the amounts you CONTRIBUTE to these funds in 2005 are considered income on the FAFSA. The amounts IN the funds are not considered assets. So, in effect, even if you ARE contributing to IRA, 401 etc, you are not hiding the money as it is shown as a contribution, and thus income on the FAFSA. That is quite different than moving monies out of one account the day you file your FAFSA. </p>
<p>I agree with the above posters who said...look into these strategies prudently, and for heavens sake...don't take advice posted on ANY message board as the gospel. See a professional in your area for advice.</p>
<p>OMG</p>
<p>LIGHTEN UP!</p>
<p>and Happy New Year to all.</p>
<p>I want to reply to your post $49 concerning "algorithmic" which tends to be my philosophy and may help some students and parents. This post may also very much confuse them. Again disclaimers prevail. </p>
<p>Wiki "algorithm", "heuristic", "arithmetic". Forgive me if I used the word "algorithmic" incorrectly in meaning.</p>
<p>When finances (Money) is brought up, I tend to look at different aspects of money. It is enough to say here that there are whole fields of study that involves money: Economics, statistics, accounting, philosophy, politics, etc. </p>
<p>We tend to believe from arithmetic that A + B = C and B + A = C. However in algorithms, A + B = C may NOT be the same as B + A =C or even C= A+ B.
There are conditions of people, place, order, rules, and "time" which alters the outcome of algorithms. FAFSA is a function of the variables of people, place, order, rules, "Money" (cash, real assets and non real assets) and "time." So in order to change the outcome of FAFSA, a person must change one or more of the variables and do it in a certain order; We are NOT changing the rules of the problem, we are just changing how we solve the problem in time, place, order, etc. The post #50 is about "rules"; #51 is about "time"; #53 is about "order"; #21 is about "emotion." Of these posts, 50, 51, 53, and 21, which will move you towards action?</p>
<p>Money and politics are queer thinkings. We do things today, for hopes for tomorrow, but don't understand the results until yesterday. </p>
<p>PS I enjoy your methodology for SAT taking.</p>
<p>one tip that is legit is paying your spring property taxes....</p>
<p>Mr. B: if I recall correctly, a student may only spend down student funds on things that are not considered parental responsibility (by the Dept of Ed). Thus, student funds could not be used for food, shelter, and probably not dental work (ok, maybe braces are not considered parental responsiblity in England). But, a car and/or laptop PC? No problem with spending kids money on those items.</p>
<p>bluebayou, you could be correct although I don't know if parents are responsifble for dental work after a child turns 18. Anyone really interested in this should seek expert advice not from unknowns in a chat room.</p>
<p>do colleges, FAFSA and CSS Profile ask for bank statements? or do they just rely on what you tell them that you have in the cash, saviongs and checking accounts?</p>