Assessed Property Value

The assessed property value on your home is how much your local tax department feels your home is worth. This number is calculated independently of how much your home is mortgaged for and how much any other entity feels the home is worth. Every few years, your tax assessor will head out into your community and do a quick assessment of the properties in your area. That assessed value is what is used to help calculate your property tax.

Different Taxing Entities

Property tax can be applied by a variety of different entities within a particular region. The most common taxing entities are the city or town, county and school district. Each entity is entitled to levy its own tax and the complete property tax burden for property owners is the combined tax of all taxing entities.

Mill Levy

The term used to refer to a tax rate is called a mill levy. It represents one-tenth of one percent. This means that for every $1,000 in property value, the mill levy is one dollar. The mill levy can be adjusted to fit the needs of each taxing entity to arrive at the final mill levy percentage that is to be used.

The mill levy is represented in a percentage where a one percent mill levy would equal a tax of $10.00 for every $1,000 in property value (keeping in mind that the mill levy itself is one-tenth of that one percent). If the city needs a one percent mill levy, the county a 0.5 percent mill levy and the school district a two percent mill levy then the total mill levy for that region would be 3.5 percent, which is also referred to as 35 mills.

Calculating Property Tax

As an example of calculating a property tax, let us say that the home in question is assessed by the town at $100,000. Since the overall mill levy is 3.5 percent, the full annual property tax would be $3,500.00 per year.

Before you purchase a home, it is always helpful to look up the home’s property tax burden each year. While the assessed value of the home is not determined by the size of the mortgage, it always good to keep in mind that purchasing a home can often trigger a new assessment from the local tax office. It is also good to remember that you can challenge a tax assessment if you feel it is unfair.

Jim Treebold

Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!

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Why Do People Need An Employment Verification Letter?

Potential landlords, loan officers and law enforcement officials are some of the people who require employment verification letters. These letters can also be used in insurance claims to confirm that an individual making a claim worked for the company in question and was covered by its insurance.

The Rules And Guidelines Of Employment Verification Letters

Many organizations that request employment verification letters have certain information that they need to see. That list is taken into account by a human resources professional, but most companies have policies on what information they will release to entities outside of the company. In some cases, the employee requesting the letter can sign a waiver allowing their information to be released. But there are some companies that are very strict on what type of information they will include in an employment verification letter.

The process starts with the employee submitting a request for an employment verification letter to human resources. When the letter is completed, it is usually given to the employee’s manager to be distributed to the employee. In this way, the company can confirm that it did generate the letter and the letter was received by the employee.

The Format For A Verification Letter

The format for a verification letter is the same as any other business correspondence. It has the recipient’s address at the top along with the date of the letter, the salutation, the letter body and then the closing. Most verification letters are two paragraphs with the first paragraph containing the pertinent information, and the second paragraph suggesting that the recipient can contact the person who created the letter for more information.

The body of the letter normally contains:

• The name of the company
• The name of the employee
• The dates the employee worked for the company
• The employee’s title

Tips For Writing A Good Employment Verification Letter

Be sure to include all of the information the requesting party is asking for, as long as company policy allows. Keep the letter brief and only state the pertinent information. A long history about the employee and extra information is not only unnecessary, but it could be a violation of company policy.

When you complete your letter, get it proofread by someone who is allowed to see drafts of employment verification letters. Be sure to check all of your information to make sure it is accurate, and include your phone number as a contact option for the recipient.

An employment verification letter is an important document that could help a current or former employee to finalize a delicate situation. Be sure the letter you write is accurate, and try to get the letter done as quickly as possible.

Jim Treebold

Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!

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Qualify as retirement age under IRS regulations
The best way to pull your money out without a penalty is to live to the ripe old age of 59 and a half years old. This is the threshold age that allows you to pull money out without a problem. For many people, this means you’ll be able to access the money even before you officially retire.

The one upside to dying
Passing away is unarguably the least efficient way to avoid a penalty for an early withdrawal. If you die, the money in your 401(k) can pass on to heirs without a penalty. Whether you’re giving money to your children or leaving it to your favorite charity, your death will help them avoid this penalty. This knowledge can give you some peace of mind if you’re stacking money away for later in life. If the worst case scenario happens, your children or other heirs won’t get clipped for a penalty fee.

Suffer from a disability
Federal law allows those with a disability to begin using their retirement funds early. In order to qualify as disabled, you have to be declared disabled either by an insurance company or by the Social Security Administration. If you find yourself disabled, it’s best to get a letter certifying this so you can access the money you need.

Medical bills under a few conditions
When you have medical bills either for yourself or a dependent, you can access that retirement money. You have to meet a few conditions, however. First, you have to take the distribution during the year your medical bills were due. On top of that, you can only take out up to 7.5% of your adjusted gross income. This means that if you have $100,000 in adjusted gross income in a given year, you’re limited to $7,500 in penalty free 401(k) withdrawals.

Early retirement
If you become unemployed after turning 55 but before hitting the magic mark of 59 and a half, you may be able to access your money without a penalty. You’ll need to be legitimately unemployed, though. The good news is that it doesn’t really matter how you become unemployed. If you choose to take early retirement or you get fired during layoffs, you will still be able to access your retirement money as long as you don’t get another job.

Jim Treebold

Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!

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The Basics Of FICA

Your FICA deduction is only half of the money paid to the federal government for Social Security and Medicare. One half is paid by the employee, and then the employer pays the same amount the employee pays.

Starting Off The Calculations

The FICA amount paid in your name (half by you and half by your employer) is based on your gross pay for the pay period. This means that FICA is calculated based on how much money you make before any other deductions are taken out.

It is important to know that your pre-tax contributions to your retirement plan and your pre-tax savings for your medical spending are subject to FICA taxes but not income taxes.

Social Security Tax Rate

The first step in calculating FICA is to multiply the gross pay for the pay period by the Social Security tax rate. In 2017, that rate was 6.3 percent. There is a maximum amount of Social Security tax an employee can pay each year. Once the employee reaches that maximum, Social Security taxes are no longer deducted. However, the employer must still pay the Social Security tax based on the employee’s gross pay.

Medicare Tax

In 2017, the Medicare tax rate was 1.45 percent for employees that made under $200,000 per year. Employees who made more than $200,000 per year would pay an additional .9 percent Medicare tax. This additional tax is cumulative and does not take effect until the employee has made more than $200,000 for that year.

Add Them Together And Subtract

After calculating the two taxes based on the current rates, you subtract that amount from the employee’s gross pay and that is their FICA deduction. The employer must then make a separate payment to FICA based on the employee’s numbers.

Taking Out Too Much

It is possible that an employer can take out too much in FICA deductions, which is a federal crime. To prevent issues with the IRS, the employer can refund the extra amount and the file IRS payroll tax correction form 941. The FICA deductions must show up on the employee’s regular pay stub and on their W-2 tax form at the end of the year.

Every American worker pays FICA, but not very many know what FICA is or how the deduction is calculated. It is always good to know where your money goes and how the government tries to get your pay before you do.

Jim Treebold

Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!

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