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Social Security pays millions to dead people

许多财务 — Tue, 13 Sep 2011 06:17:06 +0000

NEW YORK (Muchfinance) — While many Americans worry that the Social Security Administration won’t have enough money left to pay their benefits when they retire, the agency is doling out millions of dollars to people who aren’t even alive.
The Social Security inspector general estimates that the agency has made $40.3 million in erroneous payments to deceased beneficiaries — even though the administration had already recorded their deaths in its records. The estimate is based on a sample tested during its most recent audit in January 2008, the watchdog agency said.
One man told CNNMoney that he notified Social Security four years ago that his mother had passed away, but he still can’t get the agency to stop sending her checks every month.
Dennis Marvin, a Cleveland-based financial advisor, said several of his clients have grown frustrated by how long it took them to convince Social Security to stop sending payments to deceased family members.
Hey Social Security, I’m not dead!
“My clients are very concerned about whether Social Security is going to be there for them — there’s a tremendous lack of confidence in the system,” said Marvin. “The fact that some of the benefits they could get are being taken away because they are being spent on the deceased just adds fuel to the fire.”
Typically, family members or funeral directors notify the Social Security Administration of a person’s date of death. The deceased’s identifying information, including their Social Security number, date of birth and date of death, is then added to the agency’s Death Master File, a database that contains 87 million death records.
People who fail to report this information and continue to receive payments risk fraud charges and will be forced to repay the money.
California resident Rand Washburn, for example, was charged by the San Diego County district attorney with cashing in on more than $300,000 in Social Security checks that were sent to his mother for about 15 years after she died. After burying her body in the backyard, he failed to report her death to authorities, according to the DA’s office. Washburn pled guilty to felony grand theft.
Debt after death: Banks chase down mourners
Even in cases where the Social Security Administration has received notification of a death and adds the data to its master file, it has continued to make erroneous payments.
The inspector general estimates that as of January 2008, nearly 2,000 deceased beneficiaries were receiving benefits for months or even years after the agency had been notified of their deaths. If those payments were not stopped, the SSA likely dished out another $7 million in additional payments over the course of 2008, the inspector general estimated.
The Social Security Administration did not return calls or e-mails requesting comment on these errors or what it has done to reduce erroneous payments.
In its report, the inspector general estimated that the Social Security Administration could save about $152 million in unnecessary costs this year if it does a better job identifying who is actually owed money and who is not.
In addition to paying deceased beneficiaries, the inspector general’s review found that the agency overpaid about $313 million to 89,300 beneficiaries and improperly paid about $7.3 million to 11,912 non-beneficiaries.
The audit also found that of the approximately 2.8 million death reports the Social Security Administration receives per year, about 14,000 — or one in every 200 deaths — are incorrectly entered into its Death Master File.

These million-dollar mistakes come at a time when millions of elderly and unemployed Americans are relying heavily on Social Security’s disability program to get by.
Why entitlement spending must be reined in
“Any threat to a person receiving his or her [Social Security] benefits would add another level of worry to the already shaken sector of senior citizens,” said Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling, a nonprofit organization representing credit counselors.
About 21 million Americans expect to depend on Social Security in retirement as their main source of income, according to the Transamerica Center for Retirement Studies. In 2011, 55 million Americans will receive monthly benefits from Social Security adding up to $727 billion in benefits, according to SSA.

Is money pulling your marriage apart?

许多财务 — Sat, 10 Sep 2011 11:18:36 +0000

(Muchfinance) — With the economy still sputtering, you and your spouse may have found your money frustrations with each other worsening. In a recent American Express poll, 61% of couples said discussions of household finances were turning to arguments. A year ago it was 45%.
Unfortunately, “money conflicts tend to be more negative than other kinds of fights,” says Lauren Papp, a professor at the University of Wisconsin at Madison, who’s done research on the topic.
And recent studies show a correlation between money disputes and marital discontent. So how do you tell if yours are divisive or just routine?
Signs of trouble
You argue often and intensely.
In an analysis of 4,500 couples, Jeffrey Dew of Utah State University found that those who disagreed about money once a week were twice as likely to divorce as those who differed less than once a month.
Controlling your debt
Also a red flag, says Barbara Nusbaum, a New York psychologist specializing in money: You have the same fight again and again.
The disputes bleed over.
You have reason for concern if the negativity spreads, the battles cause you to withdraw from each other (particularly common after money fights, according to a study in the Journal of Family and Economic Issues), or you are prevented from making financial progress.
Debt, savings, or spending is the big issue.
These topics are particularly corrosive. Dew found that a couple with $10,000 in debt and no savings is twice as likely to divorce as a couple with no debt and $10,000 in savings.
Other research found greater marital dissatisfaction when one spouse disapproves of how the other handles money.
How to quell the yelling
Attack the financial issue.
For example, set up automatic transfers to an IRA to boost savings or use the Debt Reduction Planner at cnnmoney.com to create a pay-down plan for IOUs.
Can’t work it out on your own? A nonprofit credit counselor (nfcc.org) can help with debt.
For other issues, many fee-only financial planners (napfa.org) will do one-time consults; prices run up to $300 an hour.
Attack the relationship issue.
Often money fights are about more than just money, notes Nusbaum. They’re about differences in what money means to you. Examples include: status, security, or control.
Send The Help Desk your questions about money conflicts.
In such cases, a marital education program like PREP or PAIRS might help. These workshops, usually less than $30, teach conflict resolution.
Couples therapy is another option, though costlier at $60 to $250 a session. For best results, seek a counselor with money expertise (search aamft.org and financialtherapyassociation.org).

IRS crackdown: Tax cheat caught claiming 20 bogus kids

许多财务 — Sat, 10 Sep 2011 11:10:08 +0000

NEW YORK (Muchfinance) — Tax fraudsters are getting more creative — and, in some cases, more daring. But the IRS is making it harder for them to get away with their tricks.
Late last week, a Los Angeles woman pleaded guilty to filing tax deductions for at least 20 fictitious children — which she claimed were all born on the exact same day — in order to land a $300,000 refund, according to the United States Attorney’s Office of Los Angeles.
Norma Coronel, 40, admitted to obtaining Social Security numbers for the 20 fabricated children and having the money sent to her residence and to bank accounts she controlled, according to the Attorney’s Office. She faces a maximum sentence of 18 years in prison and a maximum fine of $750,000.
Coronel isn’t the only one who has been trying to game the system.
Deducting pornography and emu feathers
Fraud investigations initiated by the IRS jumped 14% year over year to 4,706 in fiscal 2010. Meanwhile, prosecution recommendations — cases that the IRS believes should be brought to court — climbed 18% and convictions rose 4%, according to IRS data.
While a bad economy and stubbornly high unemployment may lead more people to try to defraud the government, the IRS has done a better job of cracking down on this type of crime, according to a recent audit of the IRS conducted by the Treasury Department’s Office of Inspector General for Tax Administration.
Although special agent staffing remained nearly flat at 2,752 agents in 2010, the agency’s Criminal Investigation division cut its investigation time by nearly 9% — from an average 401 days to complete an investigation in 2009 to 365 days in 2010, according to the inspector general.
Confessions of extreme penny pinchers
The inspector general attributed the improvements to fraud and compliance training, as well as increased outreach with other IRS divisions which has helped investigators flag more potential frauds.
With ramped up enforcement, taxpayers may want to think twice before fudging their taxes. Here are some of the high-profile cases the IRS has pursued so far this year:
Last month, a Detroit strip club owner was sentenced to 12 months in prison and ordered to pay $6,000 in restitution after pleading guilty to using a computer software program to delete sales records from his two strip clubs’ sales database, according to the IRS.

The defendant was hoping to make it appear as if the clubs earned less than they actually did by understating about $500,000 of gross receipts.
Celebrity rapper Ja Rule, whose real name is Jeffrey Atkins, was sentenced to 28 months in prison after admitting that he didn’t pay his taxes for five years. His tax evasion resulted in $1.1 million in tax losses, which Ja Rule has agreed to pay — in addition to the penalties he owes, according to the IRS.
In Chicago, the owner of three “gentlemen’s clubs” was nailed by the IRS earlier this year for hiding $12 million in cash in a warehouse to avoid paying taxes on the money.
Another man was convicted of trafficking and selling counterfeit Nike shoes from China and underreporting his annual shoe sales as $22,262 in 2008, when he really earned $293,549

Older parents preparing to pay 3 tuition bills

许多财务 — Sat, 10 Sep 2011 10:59:06 +0000

Older parents preparing to pay 3 tuition bills

(Muchfinance) — Most parents struggle to balance saving for retirement with saving for college, but for Debbie and Roger Bruse, ages 47 and 54, those dueling demands are particularly pressing.
The couple, who were already in their forties when their children were born, are determined to semi-retire in 2024 (at age 60 and 67, respectively) — the same year their daughter, Sophie, now 5, will graduate from high school and their 7-year-old twins, Katie and Maggie, will be college juniors.
While the Bruses don’t plan to foot tuition in full for their girls, they’d like to cover at least half. “But can we have it all?” asks Debbie, an engineer for a large mining company.
Their combined income of $165,000 — Roger works in mine operations for the same firm — has allowed the couple to amass $770,000 for retirement and buy three rental properties.
At the pace they’re saving in their 401(k)s — $21,500 a year, with a $12,000 match — plus Social Security benefits, they should be able to retire comfortably in 13 years, says Casper, Wyo., financial planner Connie Brezik.
But they have yet to start saving for college, and they’re hobbled by $25,000 in credit card debt. Still, Brezik thinks the Bruses can have it all.
The solution
1. Clean up the balance sheet.
Paying down their credit cards and building an emergency fund (at least $30,000) should be a priority.
If the Bruses temporarily halt 401(k) contributions and put that money toward their cards, they could be debt-free in about a year, Brezik says.
And the hiatus won’t affect their retirement timetable much. Saving their annual bonus, plus belt-tightening, will help plump up their rainy-day fund.
Ask The Help Desk your personal finance questions.
2. Save strategically.
Despite their income, “with twins, they have a shot at financial aid,” says college planning expert Ray Loewe.

To preserve their chances, the Bruses should save for college via a 529 plan — a tax-free college-saving account that is counted minimally in aid decisions. They should aim to put away at least $600 a month.
3. Trade houses for degrees.
The income from the Bruses’ three rental properties near the Black Hills of South Dakota just covers their costs.
Brezik suggests selling two of the homes (they plan to retire to the third), which should net them about $75,000. Adding those proceeds to the 529s should enable the couple to meet the goal of covering half of their girls’ college bills.

Thanks, Irene: Hurricane puts stop to thousands of weddings

许多财务 — Fri, 02 Sep 2011 17:04:14 +0000

New York (Muchfinace) – Erica Sternin Weiss honeymoon in Tahiti should be right. However, due to Hurricane Irene, her wedding and honeymoon was canceled.

“Weiss said,” I was in a waterfront park on Saturday, 6:30 pm, New Rochelle, New York, married. “Friday night, our space requirements, and explain, the county is forcing them to close our wedding was canceled.”

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They said it could have been worse, but as the impact of Hurricane Irene Weiss bride, especially bitter.

Several years later, when the flood subsided, the storm cleared of fallen trees, leaving those who planned the wedding last weekend’s emotional and logistical fees.

The impact of Hurricane Irene – CNN’s full coverage
Wedding planning Web site TheKnot.com, there are plans by August 28 to August 26 in the hurricane-affected areas of 6031 wedding. Most of these areas are on the East Coast venues, expensive Manhattan, where the average tab is as high as $ 70,000. Something more reasonable – but still expensive – beyond New York. The national average wedding cost is twenty-six thousand nine hundred eighty-four U.S. dollars.

Anya said, Winikka, TheKnot website editing and re-arrange the wedding such a short period of time can be tricky, as well as expensive.

Winikka that the partner may lose their deposits and perishable items such as food and flowers of the money. Actual date, most couples have to pay at least 80% of the total cost upfront, Samantha Goldberg, the New Jersey event designer explains.

Goldberg is planning for the couple had to be postponed, and in Brooklyn, New York wedding. While on an alternative date with vendor negotiations, the bride still unable to recover sunk costs, including $ 6,000 is considered to be from New Jersey Atlantic City, a mandatory evacuation of the area on Saturday released the candy apple.

0:00 / 2:41 Irene suspected local New Jersey business
It may also be difficult to find another available date, in particular sites, usually scheduled one year in advance.

Winikka said: “You may have one day, you did not think it could be a Wednesday wedding.”

Brett Weiss and her fiance, which means marriage, on Friday night. The couple turned into a wedding, less than two hours notice of their rehearsal dinner. They wore dress and tuxedo, and their friends, you can still make it 100 before the marriage.

They also re-arrange their flights to Tahiti next Saturday – after about 36 hours coordinating with airlines and hotels. “We can not wait,” she said enthusiastically, the upcoming trip.

On the bright side, “If it rains on your wedding day is lucky, then I think we have started this thing in a pretty good place,” Weiss said, her new marriage.