Brookfield/Elm Grove Monthly

By Christopher Bennett Special to The Freeman ELM GROVE — It will strike terror into the hearts of man. Women will shriek and flee and children will tremble in terror — no one will be safe. Gloom and doom will set- tle upon the land, and all will be lost. This might be the perceived reaction of anyone preparing taxes and dealing with the Patient Protection and Afford- able Care Act. It does not need not to be, because the reality is far sim- pler. The ACA, colloquially known as Obamacare, became law in March 2010 when signed by President Barack Obama. The individual man- date provision, which stipu- lates that individuals must carry health insurance or face paying a penalty, took effect on January 1, 2014. Ever since, questions have lingered regarding what would happen when the time arrived to file 2014 income taxes, for both individuals and businesses. Individuals need not worry too much, said certified public accountant Arthur Lee, but do pay attention to detail. "I don't think it's anything to be scared of, but you need to make sure you click the right box," said Lee, managing partner at Alliance Tax in Elm Grove. "You need to have had insurance for you and your family for all of 2014." Alliance Tax is located in Suite 103 at 13500 Watertown Plank Road in Elm Grove. Lee has been a CPA for 25 years, and said he has specialized in taxes for about 15 years. If you and your family had health insurance for all of 2014 through an employer- sponsored plan, Medicaid, Medicare or another public insurance program, such as BadgerCare or Tricare, you are fine. "If you did not have health insurance in all of 2014, those months in which you did not have insurance, you may be subject to a penalty for not having health insurance for you or your spouse or depen- dents," Lee said. "You do have those issues." Lee said if an individual acquired health insurance through The Health Insur- ance Marketplace and received a credit for doing so, that credit may be considered income, and he or she might be taxed. The 1095 Form is key to determining the impact of health insurance on your tax filing. The 1095-A, according to the support section on the Turbo Tax website, is the form received from either the state or federal marketplace where an individual acquired health insurance. You should have received a 1095-A by Jan. 31, if you need- ed the form. A copy is sent to the Internal Revenue Service. The info on form 1095-A is used to complete Form 8962, Premium Tax Credit. On Feb. 20 the Obama administration acknowledged about 800,000 Obamacare enrollees received incorrect information on the 1095-A tax forms sent through health- care.gov, the federal exchange. According to CNN Money, about 20 percent of those who qualified for subsidies to lower their 2014 premiums received the inaccurate form. Those affected should receive updated forms in early March. If you did not have health insurance for a portion of 2014, you will likely face a penalty. The penalty is the higher of one percent of your yearly household income or $95 per person for the year. It is $47.50 per person for the year for uninsured children under the age of 18. Lee said the highest penalty he's seen for 2014 is $160. Lee also said the penalty jumps significantly for any- one uninsured in 2015. The penalty in 2015 will be $325 per person and $695 in 2016, with uninsured children remain- ing at half of the adult amount. Some learned they owe a penalty for not being insured in 2014 only when they tried filing their taxes, and wanted to enroll for 2015 and avoid additional penalties. Special enrollment period According to CNN Money, the special enrollment period, which runs from March 15 to April 30, is open to those who are currently uninsured and learned they owe the penalty after open enrollment ended on Feb. 15. The special enroll- ment period applies to those in the 37 states using the fed- eral exchange. Enrollment for 2016 will run from Nov. 1, 2015 through Jan. 31, 2016. Lee said he spends about 60 hours per year in continuing education to stay current on tax preparation. "Because the laws change every year, it is hard to keep up with new tax laws and new credits that might be applica- ble to you," Lee said. "I believe everyone should pay taxes, but I believe you should only pay what you legally owe and not a dime more. "Unless you're really on top of new tax laws, it's hard to know if you're missing some- thing or not." Lee said he can complete taxes for the April 15 filing deadline if he receives the information a week to 10 days prior. He can be reached at (262) 786-4442. Page 6A • Freeman Brookfield & Elm Grove MARCH 2015 2 4 2 9 1 8 0 0 1 • Personalized On-Site Event Coordination • Grand Ballroom can accommodate celebrations of up to 300 • Ceremony, Reception & Group Rooms • All-Inclusive Packages include: Centerpieces, Dance Floor & Head Table Décor • Book your event by April 30th, 2015 and receive a complimentary upgrade Y o u r H a p p i l y E v e r A f t e r B e g i n s H e r e . . . nicole.brown@brookfieldsuites.com www.BrookfieldSuitesHotel.com 1200 S. Moorland Rd. Brookfield, WI 53005 262.796.9109 = 242922003 OFFER C a sh R e w a r d 242683002 By Christopher Bennett Special to The Freeman SUSSEX — The child you worked for years to raise and nurture is going to, someday (hopefully), venture into the world and be wholly responsi- ble for his or her financial life. If your son or daughter heads to college, they will be inundated with credit card offers that seem too good to be true. If your child joins the mil- itary, car dealerships and pay- day loan stores are all too com- mon near many bases and installations. The temptation of a short- term fling with a credit card, or a new car with dreadful loan terms, might be too much for your child — now young adult — to overlook if he or she is financially illiterate. Mistakes of this nature can carry devastating conse- quences, and take years to mend. But there is a way par- ents can help protect their chil- dren indefinitely. "I'm finding that teaching kids to be responsible with money is starting at a younger and younger age, all the time," said Waukesha State Bank's Heather Pfalz. Pfalz is an assis- tant vice president and branch manager of Waukesha State Bank's Sussex branch. Waukesha State Bank also operates branches in Brook- field at 18300 W. Capitol Drive and in New Berlin at 14000 W. National Ave. "We feel the earlier, the bet- ter," Pfalz said of financial lit- eracy for children. "Kids are learning from their parents as soon as they can start talking and comprehend." However a parent begins teaching the concept of finan- cial literacy is best left to the parent, and numerous online resources exist for such an endeavor. Banks and credit unions are also excellent places for parents to begin the teach- ing process. "The main lesson is (being) financially literate and finan- cially responsible," said Victor Frasher, high school branch program manager with Educa- tors Credit Union. "At the end of the day, it's your money and your credit report, and you have to be responsible for those items." ECU operates a branch in New Berlin at 15350 W. Howard Ave. and in Waukesha at 1600 Summit Ave. Both Waukesha State Bank and EU use various methods to reiterate key points about financial literacy. Pfalz said Waukesha State Bank stresses the difference between wants and needs. "We try to constantly drive home needs versus wants," Pfalz said. "Saving for what you want, instead of going for instant gratification." If taken to heart, such a les- son learned as a child can keep an adult from accumulating too much unsecured debt. Pfalz used the example of a young girl wanting a Barbie doll, and a parent taking the opportuni- ty to demonstrate the financial steps needed to acquire the doll. Frasher said ECU focuses much of its education efforts on one's credit score and iden- tity theft. Frasher said it is not uncommon for young adults to be denied financial services, and learn it is because some- one else previously established credit in their name. "Credit is the second most important number in your life, and understanding what that number is and how that num- ber affects our whole life is important," Frasher said. Frasher said one's Social Security number is life's most important number. ECU and Waukesha State Bank offer numerous programs and ser- vices for children from birth through age 18, all in an effort to encourage financial literacy. Waukesha State Bank starts with savings accounts for new- borns. Those in elementary school might tour the bank and learn how money is made. Junior high students learn about budgeting and savings, and those in high school learn about checking accounts and credit cards. ECU even runs student branches in some high schools, in addition to facilitating other programs. Frasher said there is an idea that young people are disinterested and uneducated regarding money matters. That perception leads to young peo- ple being targeted by financial predators. Efforts in tandem from par- ents and financial institutions can keep young people from being preyed on, and can lead to habits that will help ensure a lifetime of financial indepen- dence. "The general public really believes the younger genera- tion is just naïve and uneducat- ed," Frasher said. "There are people out there that will take advantage of that naiveté." Obamacare and tax preparation — not as scary as you might think Financial literacy for children

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