Life is often viewed as a series of stages – childhood, graduation, parenthood, and retirement, to name a few. Like the points on a clock, time moves us from one stage to the next. No matter what “time” it is in your life cycle, you probably share a common worry: money. Managing money for today is one thing; making decisions to ensure adequate funds for the next stage is quite another.

The CPA commitment. As trusted advisors, CPAs across the country have made a commitment to increase financial literacy. How? By volunteering to educate the public about financial issues and the decisions that must be made at every stage of life. Americans are faced with significant financial concerns, but often have insufficient financial literacy. Bright and even highly educated people sometimes have trouble speaking the language of money, often to their economic detriment.

To combat this trend, the CPA profession has united around a cause to educate Americans, rich and poor, young and old, on how to better handle their finances. With the life cycle “clock” as a model, CPAs have taken a full, 360-degree view of the challenges Americans face. For each milestone, the profession has solid, practical advice to share. You might say CPAs are once again emphasizing the term “public” in their title.

Call on us. Which brings us to our firm, Loeffler Financial Group. We, too, have accepted the call to educate our community. Our team of experts would be pleased to speak to your organization about life’s financial challenges. We can also speak to students or provide classrooms with timely, interesting material on money and financial issues.

If you would like to find out more about the accounting profession’s drive to improve financial literacy, give us a call. Life’s financial clock is ticking. Let us help you before the alarm goes off. Call Loeffler Financial Group today at 717-393-7366!

Be aware that important tax consequences are often associated with some fairly common events involving your home. Here are some handy things to know.

Home purchase. When purchasing a home, you may pay a portion of the mortgage interest in advance. This loan origination fee, or “points,” is a percentage of the total amount borrowed.

If points are paid for a principal residence, you generally can deduct the full amount in the year paid, even if the points were paid by the seller. One caution: you must reduce your home’s tax basis (cost) by the amount of seller-paid points.

Of course, one of the greatest tax benefits of home ownership kicks in during the early years of the mortgage, when most of your payments go toward tax-deductible interest.

IRA withdrawals. The tax law allows penalty-free IRA withdrawals, up to a lifetime limit of $10,000 for the purchase of a first home for you or members of your family. Withdrawals from Roth IRAs for qualifying first-home expenses can be both penalty- and tax-free after the Roth is five years old.

Refinancing. What happens if you refinance? If you pay points, the general rule requires that you prorate deduction over the life of the loan. But if some of the refinance proceeds go toward home improvements, you may be able to take a current deduction for the portion of the points related to those improvements.

Improvements. If you take out a loan to make substantial improvements to your principal residence, and the loan is secured by that property, the interest is generally deductible. Remodeling often increases the value of your property. Remodeling costs also increase the property’s basis, potentially reducing capital gains tax if a future sale is partially or fully taxable.

Other home improvement costs generally are not deductible, but if you upgrade your home for medical reasons – say, to add a wheelchair ramp or stair lift – you may be able to deduct a portion of the cost as a medical expense.

Home office. The home office deduction can be another tax break of home ownership. If you use part of your home regularly and exclusively as a principal place of business, you may be able to deduct costs associated with that part.

Home sale. When you sell a home that you have owned and used as your principal residence for at least two of the five years before the sale, you can generally exclude from taxation up to $250,000 of profit if you’re single and up to $500,000 if you’re married filing jointly. Profits in excess of those amounts are subject to regular capital gains rates and rules.

The definition of “principal residence” includes not only the conventional single family house, but also such homes as house trailers, mobile homes, houseboats, condominiums, cooperative apartments, and duplexes.

Selling at a loss. Unfortunately, if you sell your home for less than you paid for it, you may not take a tax deduction for your loss.

Taxes often come into play for homeowners, and it’s important to be aware of potential benefits and pitfalls.