Brenner: Social Security off limits to most creditors

October 12, 2008

As of the 2007 tax filing, I owe the government some money. If I elect to start to receive my Social Security benefit, will I get the check, or will the Internal Revenue Service take it to pay down my debt?

Recent columns

• FAMILY FINANCE: Savings are safe in a credit union

  October 5, 2008

  My husband and I are retired. We have our savings in a federal credit union, and I am not sure if it is as safe as an FDIC account at a bank. The credit union states that it is federally insured, but I'm still not convinced that our savings are safe. Please tell me the difference between the Federal Deposit Insurance Corporation and the National Credit Union Administration, and whether I should transfer to a bank.

• FAMILY FINANCE: What to do with your WaMu accounts

  September 28, 2008

  I am 75 years old and retired, with only Social Security benefits. My wife and I have two IRAs in Washington Mutual Bank. Each account has $40,000. With news of the bank being taken over by the FDIC and then sold to JPMorgan Chase, I was thinking of withdrawing the money if that can be done as a rollover to another bank. I do not want to take it out if I have to claim it on my income tax as income.

• FAMILY FINANCE: Making sure the mortgages are paid

  September 21, 2008

  My mother, who recently passed away in North Carolina, owned two pieces of property in her name alone. Both have mortgages on which she and her husband were the borrowers. Mom left her solely owned property to be held as a life trust for her husband. After his death, it goes to me and my sisters. The properties are now recorded by the county as "[Mom's husband] Life Trust." I contacted the banks that hold the mortgages and equity loans to find out how I could be notified if the mortgages are not paid. I was told that only the borrower could authorize me to obtain this information. My concern is that if the mortgages and taxes are not paid, I will have no way of finding out. Is there a way I can legally be notified without insulting Mom's husband?

• Spousal benefit key to Social Security decision

  September 14, 2008

  I'm 58 and my husband is 62. We're both eligible for Social Security on our own work records. His benefit is higher than mine. Our plan is for me to start taking mine (on my record) when I turn 62. He'd wait until he's 70, to take advantage of the increased benefit. We recently read that when I start taking my benefit at age 62, my husband - who at that point would be 66 - could receive a spousal benefit based on my earnings record. He'd receive half the benefit I'd have received at my full retirement age. Then when he turned 70, he could switch to receiving payment based on his own work record at the higher, age 70 amount. But I've found nothing on the Social Security Web site to confirm this, and I was hoping you could. We wouldn't want to make decisions based on inaccurate information.

• Preparing for likely tax hikes in 2009

  September 7, 2008

  I've been reading predictions that taxes are likely to rise no matter who wins the presidential election. If that's true, is there any year-end tax planning I should be doing? I'm 61, and I earn $175,000 a year. My portfolio (mostly mutual funds) is worth about $1.3 million.

• Family Finance: Reconciling 1099s and tax forms

  August 31, 2008

  There seems to be confusion about what taxes are due when two New York Stock Exchange companies merge. In a merger between companies A and B, Company B paid Company A stockholders in cash and stock. Company B reported the fair market value of the stock and the cash portion to the Internal Revenue Service on Form 1099-B. Clearly, the cash is taxable; but the stock portion should not be taxable until the stock is sold. Can you clarify this?

• Nurse with no address still has to pay New York taxes

  August 24, 2008

  I've applied for a traveling nurse's position throughout the United States with an agency. I'll be doing 13-week details throughout the country. I will be provided apartments and traveling expenses by the agency. I'll be giving up my New York apartment and will have no permanent address. I can use my mother's address in New York or my grandmother's address in Florida, but I won't have an apartment in either state. Must I file taxes in New York even though I won't be living here? Do I have to file state tax returns in other states I've worked in? Do I have to pay New York state tax on income earned in a state that does not have state tax?

• On early withdrawal of 401(k) to start a business

  August 17, 2008

  I was downsized last August. Shortly afterward, I needed surgery and was unable to look for work until January. Since then, I've had no luck; there is very little out there. I am 43 and was making $67,000 a year. I owe about $285,000 on my home. (I took a second mortgage to do a new roof, windows, etc.) Fortunately, I don't owe any credit card debt; I always pay it off at the end of the month. I've been taking small business courses, as I always wanted to start my own consulting business for computer network repair and installation. I have about $43,000 in a 401(k). Is it worth taking a partial early withdrawal to get my business started, instead of taking on more debt? Also, if I don't start a business or find a job, I know the government waives the 10 percent early-withdrawal fee if you use 401(k) money so you won't lose your house. But must you be in default on your mortgage, or can it just be that you're out of resources and you don't want to go into default?

• What can fired employee do about lying owners?

  August 10, 2008

  I worked for 22 years at an assisted-living facility on Long Island. I developed many close relationships with my fellow employees, with residents, even with residents' families. Then the facility was taken over by new owners. A few months ago, a new administrator told me my salary was to be cut by almost 50 percent. Then, about six weeks ago, she called me into her office and told me I was fired. For the first time, I had to apply for unemployment compensation. I received it for two weeks and then was told the payments were stopping because my former employer said I had quit. Nothing could be further from the truth; even after the salary cut, I intended to stay. I know there will be a hearing about this - but what if they continue to lie?

• Brenner: Tell collectors you want it in writing

  August 3, 2008

  My father-in-law died a few years ago. At that time, my wife paid thousands of dollars of his bills, almost pushing us into debt. There still seems to be an outstanding bill that a collection agency calls about. My wife will not answer their calls and tells me that I should tell them that no such person lives here. She says she was told by a lawyer that she is not responsible for her father's debt and does not have to pay it. Please advise what we should do concerning this matter.

• Family Finance: Administrating dad's will-less estate

  July 27, 2008

  My spouse recently lost her father, who left no will. She is the sole surviving family member. She recently received checks refunding deposits on her father's rental apartment, but they came in his name. We asked the Realtor in writing to change the payee to include her name, but we were told this would not help us deposit the checks either. We have been told to acquire a "letter of testimony" to finalize this process. What needs to be done to allow her to make these deposits?

• Family Finance: Social Security affects retirement

  July 20, 2008

  Your June 15 column was the first time I've ever seen a formula for figuring out how much you need to save for retirement that makes sense. Does it take Social Security into consideration?

• If you haven't tied the knot

  June 26, 2004

  Estate planning is a good idea for everybody, but for unmarried couples, it's vital. Unlike spouses, they have no legal inheritance rights based on their relationship.

• Distributing the Inheritance: It's a Matter of Trust

  November 15, 2003

  Estate planning is a fairly straightforward business if your heirs are all mature, financially sophisticated adults who can take care of themselves after you're gone.

• Coming to Terms With Financial Planning Jargon

  November 1, 2003

  Financial planning has its own jargon - a hodgepodge of legal, tax, insurance and investment terms that's fully comprehensible only to practitioners. This is particularly true of estate planning, which, in plain terms, means figuring out how to make sure that even after you're not around, your money will do what you want it to do for the people you love.

• Rich or Not, an Estate Plan Is an Asset

  February 1, 2003

  Why do we keep saying that you don't have to be rich to need an estate plan? Because money isn't the big issue. The main goal is to protect and help the people you love after you're dead. Beating the tax collector, although deeply satisfying, is a secondary consideration.