Home Ownership

Household employees include baby sitters, nannies, housekeepers, drivers, caretakers, health aids, private nurses, maids, gardeners, and others who work in or around your private residence as your employees. Household workers who are under age 18 during any part of the calendar year are exempt from the FICA tax for the entire year even if the wages exceed $1,800 if the household employment is not their principal occupation. A full time student is considered a full time occupation. Workers you get from an agency are not your employees if the agency is responsible for who does the work and how it is done. Self-employed workers are not considered your employees. In the current year, if you paid a household employee cash wages of $1,800 or more in a calendar year, you generally must withhold social security and Medicare taxes from all cash wages you pay to that employee. Household employers must file IRS Schedule H to pay the social security and federal unemployment tax and any withheld federal income taxes. A household employer is not required to withhold federal income tax from a household employee's wages. Federal income tax withholding occurs if the employee requests and the employer agrees.

A loan that exceeds the conventional loan limit or does not conform to the guidelines established by Freddie Mac or Fannie Mae is called a Jumbo loan. Generally, these loan amounts can go up to three million dollars. Loan to value limits for Jumbo loans range from 60 percent to 95 percent, depending on the loan amount.

Some banks use a 33%/38% ratio guideline. According to this guideline your monthly mortgage payment including principal, interest, taxes and insurance should not be more than 33% of your gross monthly income. Also your total monthly debt payments including the mortgage, credit card payments and installment loans should not exceed 38% of your gross monthly income.

Closing costs are one time fees associated with a mortgage. Generally, the amounts vary from 3-7% of the total mortgage amount. Closing costs may include attorney fees, title insurance and related charges, mortgage tax, recording filing fees, tax service fees. Other payments at the closing may include Real Estate tax escrows, homeowner's insurance escrows, origination points, private mortgage insurance fees. You should receive a estimated closing costs document from the bank prior to the actual closing.

Dividends are paid in U.S. dollars and are generally taxable, similar to dividends paid on U.S. shares. Generally, taxes are withheld by the American Depositary Receipt company's local government. Usually, foreign taxes paid can be used to calculate a credit against U.S. taxes on IRS Form 1116 or Schedule A. Speak to your local CPA or bank about investments in American Depositary Receipts.

If your school is authorized by the Department of Education, and uses the Master Promissory Note as a multi-year note, you will only have to sign the note once as long as you don't change lenders. If you attend a two year or proprietary school, you will need to complete the Master Promissory Note each year. If your Master Promissory Note exceeds 10 years, you must sign a new Master Promissory Note.

Grace Period is a short time period after graduation during which the borrower is not required to begin repaying his or her student loans. The grace period may also kick in if the borrower leaves school for a reason other than graduation or drops below half time enrollment. Depending on the type of loan, you will have a grace period of six months for Stafford Loans or nine months for Perkins Loans before you must start making payments on your student loans. The PLUS Loans do not have a grace period.

The first step in the college loan process is to fill out the FAFSA form. This form can be obtained from your child's high school guidance office and can also be obtained on the web at www.fafsa.ed.gov. Once you complete the application, you will find out what loan programs you are eligible for. Please speak to a CPA in your area for other loan options.

Yes, your parents will have an opportunity to cancel their loan after they sign the promissory note. Your college must notify your parents in writing whenever it credits your account with your PLUS Loan funds.
This notification must be sent to your parents no earlier than 30 days before, and no later than 30 days after the college credits your account.
Your parents may cancel all or a portion of their loan if they inform your college that they wish to do so within 14 days after the date that your college sends this notice, or by the first day of the payment period, whichever is later.
Your college can tell you the first day of your payment period. If your parents receive PLUS Loan funds directly by check, they may refuse the funds by not endorsing the check.