Category Archives: Personal Finance

What Happens to Old EIN Numbers?

An Employer Identification Number (EIN) is vital for almost all types of business. This unique number provides your company credibility, allows you to apply for business licenses, open a business bank account, file tax reports, and file electronic tax payments and returns. An EIN number is also needed if you are an executor of an estate or control a trust. IRS-EIN-Tax-ID provides an easy and safe way to apply for an EIN for your business, trust, as well as an EIN number for an estate.

Inactive Employer Identification Numbers

Simply put, once an EIN has been assigned to your business entity, it becomes that entity’s permanent Federal taxpayer identification number. The Internal Revenue Service (IRS) does not cancel EINs regardless if it is never used. This none-digit number is never reused or reassigned to another entity. The EIN can be used for that entity again at a later date, should the owner need it.

However, if you obtained an EIN but later decided it is not needed, for whatever reason, you can choose for the IRS to close your business account. To do so, send a letter to the IRS that includes the EIN, legal name of the business, the address of the business, and a reason for closing your account. Also, include a copy of the EIN Assignment Notice if possible.

Businesses Required to Apply for EIN

If your business falls under any one of these situations, an EIN is required:

  • You have employees
  • Business is a partnership of corporation
  • You withhold non-wage income paid to a non-resident alien
  • You run a farmers’ cooperative or non-profit organization
  • You have Keogh plan
  • You are a plan administrator
  • You file tax returns for excise, alcohol, firearms, and tobacco
  • Have an estate

You must also obtain an irrevocable trust tax ID number if you are a grantor of an irrevocable trust.

To learn more about EINs or how to easily apply, visit the IRS EIN Tax ID website.

When You Should Use a Short Term Loan

A 2017 GOBankingRates survey broke some alarming news: over half of Americans have less than $1000 in a savings account, and almost half of the people who fall in this category don’t have anything in a savings account at all. With almost 7 out of every 10 Americans having somewhere between absolutely nothing and just $1,000 in savings, there’s reason to be concerned about the ability of many Americans to pay for emergencies.

If you’re one of these Americans who doesn’t have a savings account, it’s time to start one. I’m sure you’re fully aware that emergencies come up, and emergencies often come with a hefty price tag. I totally sympathize with the assumed reaction here, which is that you just don’t have extra money to save. However, if you don’t think you have money to stick in savings now, you certainly won’t have the (much larger sum of) money to cover an unexpected expense.

Getting Started with Savings

Starting to save doesn’t require hundreds of dollars, especially if committing to save is going to require some serious budgeting shifting for your family. Even starting with just $20 and adding $5 a week is a great way to start forming healthy saving habits.

Looking for small things to cut out of your budget and redirect those funds to savings is a favor to your future self. I promise that while cancelling Netflix or choosing to eat meatless meals 2 times a week to cut back on the grocery budget might feel like a huge sacrifice in the moment, the sacrifice will seem much smaller when you’re better prepared financially for an emergency.

Many people who save have one checking account and one savings account. The checking account is used for daily expenses, and the savings account is where they stick money back for anything that might come up – an emergency, a vacation, a medical bill, or a down payment on a new house to name a few uses.

Savings accounts can be opened at your local bank or credit union, or through an online bank. It’s worth looking into an online bank for savings as they often have much lower overhead and are able to offer significantly higher interest rates than traditional financial institutions.

If you don’t think you have much money to save, there are lots of savings challenges to help you find a little money to save here and there. Challenges range from saving $1 each week to match what number of the year that week is (first week of the year = save $1, last week of the year = save $52) to saving 1 cent for what day of the year it is (January 1st = save 1 cent, December 31st = save $3.65), among others. You can do this with actual currency, or set up auto transfers from your checking account to savings.

Multiple Savings Accounts

While saving money is always a great practice, saving all your money in one account can be problematic. Let’s say you spend your entire savings account taking a beach vacation. You get home and find that your car won’t start in the airport parking lot. You have to pay to get it towed, and you later get a $500 bill from the mechanic for a new starter. You just spent all your savings on margaritas on the beach, how are you going to pay for this?

Having multiple savings accounts, each designated for something different, can help you avoid siIf you need money either personally or professionally and don’t know what to do, it is best to analyze your situation to figure out the best course of action. Why did you run out of money? How much do you need to borrow? How long will it take you to pay it back? If the amount is a reasonable sum and you think you can pay it back in a short period of time, than a short term loan may be what you need. A short term loan is usually a loan that has a shorter pay back period. Loan amounts are not excessive and are also easier to get than standard loans. Since they are more accessible and easier to apply for than it can also get some people into trouble. Below are certain situations where a short term loan would be a good option.

Seasonal Business

Some businesses are seasonal. There are periods where the income can be high or low, but it usually predictable. For example, an ice cream store knows that the summer will be busier than the winter, and that is predictable. You can forecast your busy season if your business is seasonal. If you are low on cash to build your business but know that there are busier times ahead that will allow you to pay off the loan during your busier season, than a short term loan is smart for you.

Bad Credit

The problem with standard loans is that sometimes they are not easy to get because of bad credit. If you have difficulty getting loans because of your credit than a short term loan may be your best bet. A lot of times short term loans have more leniency towards bad credit but you do pay for that consideration. They are taking on the riskier borrowers.


You need to show that you have the potential to pay back your loan in the near future. Short term loans are based on projected future cash flow. History is key. If you are known to have a successful business but are having a tough time, than they can project you will be able to pay back their loan.

Emergency Repairs

If you are running a business and encounter emergency problems, than short term loans are good for you. Personally, if your car breaks down, your roof leaks, your hot water heater breaks, than a short term loan will be to your rescue when your monthly budget doesn’t allow the cash flow to help. Professionally, if a piece of equipment breaks or your store gets damaged than this loan product may be good for you. This is because you know you typically can function with your cash flows, just an unforeseen circumstance occurred that made it difficult to make ends meet.tuations like this. Different savings accounts might include an emergency account, a travel account, a Christmas account, a vehicle account, or a home improvement account.

When you have multiple savings accounts with specific designations, you won’t spend everything you’ve saved on one expense. Of course there will be times than an emergency or an opportunity costs more than what the most closely designated account can cover, so it’s nice to have other funds to pull from in these instances.

Splitting what you can save into multiple accounts may mean it takes longer to reach your savings goals. However, it’s worth it to be able to treat yourself or cover an expense without it affecting your other savings goals.

How Much Cash You Need To Buy A Home

Are you contemplating buying a new home? If so, have you ever considered how much cash you will need to have on hand? Many consumers would love to buy property, but find that their budget will not support the major expense. Of course, the cost does not deter some consumers from turning their dream into a reality. Regardless, if you are going to take out a mortgage, you will need a significant amount of cash on hand. Below, you will discover a list of factors that will help you determine your cash needs.

Average Down Payment

The average down payment requirement for a home is 20 percent. However, there are factors that can help reduce this amount. These factors include you income and credit history, as well as the lending program. If you have a high credit score, you may not be required to make such a large down payment. If your income falls within the median range, you could qualify for a lower down payment.

According to recent government data, the median household income in the United States is $56,500. About half of all Americans will fall above this amount and the other half will fall below. The lender will help you determine if you qualify for a lower down payment.

Poor Credit History

As mentioned above, a low credit score can impact the amount of cash you will need for a down payment on a new home. In fact, some lenders will require a down payment of 20 percent or more, if your credit score is between 300 and 629, it is consider bad. A credit score between 630 and 689 is consider fair, score between 690 and 719 is good and 720 and 850 is excellent.

Better Interest Rate

While some consumers do not have enough cash on hand for a down payment, others have access to plenty of cash. If you have most of the cash and only lack about $2,000 you could always take a short-term loan. This will give you enough money for the down payment, so you there will be no more excuses not to buy a home. The experts at offer fast cash for emergencies and other purposes.

Paying more down on a home can help lower your interest rate. Even if the lender you are working with requests a lower down payment, it would be in your best interest to pay more.

Mortgage Insurance

Consumers who are strapped for cash, but have a high credit score can save money by just agreeing to pay mortgage insurance. The purpose of this insurance is to protect the lender from financial loss associated with a default of a loan. This is when the buyer does not make mortgage payments. Of course, this is something that no consumers want to do, because it will have a negative impact on the credit score.

Mortgage insurance is beneficial to homebuyers as well. It helps them lower their down payment and many lenders will automatically remove the insurance after 20 percent of the loan is paid off.