| In a world where the vast majority of
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| | own money. There are at least a hundred
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| millionaires are made just pennies and
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| | better alternatives to using your money
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| dollars at a time, controlling and
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| | than overpaying the government on FICA
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| managing your money is paramount to
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| | taxes and letting this excess sit in
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| establishing financial freedom.
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| | their coffers until you file your tax
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| Understanding FICA inside and out is
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| | returns. Here are just few ways to make
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| important to those that are financially
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| | better use of your own money and perhaps
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| driven. As you probably know FICA refers
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| | help you become a millionaire.
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| to the social security and medicare taxes
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| | Top 3 Alternatives to Overpaying FICA
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| that the government collects from each
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| | Taxes
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| paycheck. Millions of Americans are
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| | 1. Hide the Money - Put the money under
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| overpaying these FICA taxes each year.
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| | your mattress. At a bare minimum having
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| Although it remains true that you will
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| | free access to your own money is 10 times
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| receive a refund on these overpayments
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| | better than anxiously awaiting your tax
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| when you file your tax returns there
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| | return so you can have what is rightfully
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| remains an opportunity cost associated
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| | yours. If you are going to give up access
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| with these overpayments. By definition an
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| | to your money for a period of time you
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| opportunity cost is the cost of the most
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| | should expect something in return.
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| valuable foregone alternative.
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| | 2. Save the Money - By save we mean put
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| In this FICA tax scenario let's suppose
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| | the money in a savings account in the
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| you overpay by $300. Eventually you will
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| | bank so you are at least earning a low
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| be refunded this money but for a period
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| | interest yield on your idle money. In
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| of time the government has your $300 in
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| | addition to this small interest yield, a
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| its possession. Since this money is in
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| | savings account allows you free and easy
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| the possession of the government they are
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| | access to your money.
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| able to make interest on your hard earned
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| | 3. Invest the Money - If you don't
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| money. The cost you incur by overpaying
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| | require easy access to your money and you
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| the government is the amount of interest
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| | want to begin a monthly investment plan
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| you could have made on this money in the
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| | consider investing in mutual funds. There
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| given time period. Though the interest
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| | are many plans that will allow you to
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| that could be earned on $300 in a short
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| | invest just a few dollars a month and
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| period of time is nominal at best, it is
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| | offer higher yields than any savings
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| the principle that holds the most
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| | account.
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| importance. Those that enjoy financial
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| | To learn more about FICA and what forms
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| well-being maintain control of their own
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| | of income are subject to this tax feel
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| money and put it to effective
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| | free to visit TurboTax.com, which offers
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| utilization.
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| | a wealth of insight and information
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| Allowing the government to collect more
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| | regarding income subject to FICA. And
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| than its fair share of FICA taxes on your
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| | remember to use your money wisely as you
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| paycheck is not an effective use of your
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| | establish your financial freedom.
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