Because I have written many articles in these pages about lowering one’s taxes, I am often asked this reasonable question: “I have only one job and an uncomplicated financial situation. Can’t I do my taxes myself using good old Turbo-Tax?”

Yes, you can, but even those with simple returns can save money by using a tax strategy called “bunching.” Imagine a single young woman who works as a nurse and earns $55,000 a year. She does not own a house and therefore cannot claim a deduction for a mortgage. Should she itemize her deductions or claim the “standard deduction”?

A little background: There are two kinds of tax deductions: “above the line” and “below the line.” This line has a name; it is called “adjusted gross income.” The deductions above the AGI are allowed so long as you paid them. The most common of these is putting money in pensions and IRAs.

It is no secret that college costs money – lots of it. However, many students are able to go because they receive financial aid from both the federal and state government. The starting point for all these sources of aid is a form called FAFSA, Free Application for Federal Student Aid.  Bear in mind that many yeshivas and seminaries are legal colleges, so their students qualify.

Some parents think the FAFSA does not apply to them, because they believe their income is too high. This is a mistake, because, even if you do not qualify for government aid, you might be eligible for aid from the college itself, and they use the FAFSA when granting it. Furthermore, according to a recent article by Wall Street Journal, even wealthy students should file the FAFSA. They offered several reasons. First, you might sometimes get aid even if you think you earn too much. Second, by filing the form and getting turned down, the college realizes that you can afford full tuition. Since they need some students who can pay, that might give you an edge on admission!

Rabbi Berel Wein tells a humorous story about the time his plane ticket was cancelled due to a mix-up. Twenty minutes before take-off, the airline quickly seated him in first class, next to the vice-president of TWA. The vice-president noticed him reading the Chumash in Hebrew. After a few moments, he leaned over and asked, “What language is that book written in?” 

“Hebrew,” Rabbi Wein replied, sweetly. “You mean there are still people left in the world who read and write Hebrew?” he responded incredulously. “I thought it was a dead language.” "Well,” Rabbi Wein explained, “there are millions of people in the world who read, write, and speak Hebrew. In fact, your airline flies regularly to a country where Hebrew is the official language, spoken by millions of people.”For some reason the VP disliked the response. “I see that you and I have nothing in common,” he muttered, turning away.

Once again, tax time brings some confusion. Several tax breaks expired at the end of 2014. It is expected that they will be reinstated retroactively, though, and will apply to the 2015 tax year. It is almost December and it has not happened yet. The same thing happened last year, so stand by.

Planning Ahead

The tax fundamentals remain the same. Here are some general planning pointers:

1) Planning helps. For example, if you are married on the last day of the year, you are considered married for tax purposes. So get married in December rather than January.

2) Obviously, the lower your income, the better. Pensions, daycare, work expenses, and health expenses can be paid for with pretax dollars.

3) Sign up for your company’s pension plan. It saves taxes now and prepares for old age later. Not participating is a big mistake, especially if the company matches your contribution.

A friend of mine received a call from an unfamiliar number. When she asked who it was, the caller replied, “Your grandson.” After hesitating a second or two, my friend said, “You must have the wrong number” and hung up. It was only later that she remembered an article about scammers who use this ruse to extract money from seniors, and was amazed that she could have considered the call legitimate even briefly.

When we hear about outrageous scams, we wonder, “How could they have fallen for that?” But people do, even some of the most intelligent among us. With Consumer Reports’ recent cover story on the topic of senior scams, I thought it would be a good time to review this important and timely topic.

With the summer coming to a close, and my recent trip out West fresh in my mind, I thought now would be a good time to do a how-to article, so you can start planning for next summer. In addition to building anticipation, early planning is important for accumulating credit card miles. Please skip that winter break in Florida and save your miles for a fantastic jaunt to the American West.

Where Are You Going?

The first and most obvious thing to do when deciding on a trip is to pick the destination. As I have written in the past, I am a huge fan of our national parks. Folks, our Creator has given us a beautiful world. To me, it seems almost like a religious obligation to see as much of it as we can.