What You Need to Know About the Underpayment Penalty

The definition of the underpayment penalty is a tax penalty enacted on an individual for not paying enough of his or her total estimated tax and withholding. Most places of employment will withhold taxes automatically. Checking a pay stub will show how much tax has been deducted and paid to the state and federal so people can keep track of it for their records.

How Do You Get an Underpayment Penalty?

Taxes can be confusing when multiple streams of income are coming in and estimating how much tax should be withheld from each one. The penalties come about when an estimated amount of the income you've made isn't paid to the IRS. 

Taxes from income are estimated on a quarterly basis and normally paid out before the quarter is up. These taxes can be applied to rent, self-employment, interest, etc. Basically, any source of money coming in or out is taxable.

The underpayment penalty comes into play when not enough of the estimated tax has been paid each quarter. This doesn't mean the IRS is going to come at you full force if you don't pay enough tax each quarter, weren't aware of it, or didn't have enough money to pay.

What Do You Do When Faced with the Penalty?

Whether your income comes in from a side business or somewhere else, if you do accrue a penalty the first step is communicating with the IRS. Finding out how much you owe in taxes and whether or not the penalty can be forgiven depends on your financial situation. People facing the penalty for the first time due to an error and not neglecting the responsibility will face less harsh consequences.




Making an appointment with a tax attorney at this point would be in your best interests, especially if you owe a significant amount to the IRS. Every financial situation is different and a tax attorney can help you navigate how much you need to pay back in taxes. 

Penalties can increase the amount you owe the IRS the longer the taxes go unpaid, so you want to get in touch with the IRS as soon as possible to pursue the best course of action.

Underpayment tax is calculated by income earned and the amount owed, and when penalties come into play the amount can easily increase. If, for example, you were unable to pay taxes last year due to not having enough money, you can most likely arrange a payment plan with the IRS to pay off the different amount. 

Keep in mind, there are also exceptions where the underpayment penalty will be waived depending on certain circumstances, like a natural disaster, paid at least 90% of taxes owed, etc. Investopedia does a great break down of exceptions of the situations and circumstances of when the penalty can be waived.

How Do You Avoid the Penalty?

The best way to avoid the underpayment penalty is to keep records of each source of income coming in and estimating the taxes needed to be paid on both. If you have multiple sources of income, whether from self-employment, rent, etc., you may want to talk to an accountant to help you keep track of how much is owed. 

If not, you can pay taxes quarterly for each source of income so the amount doesn't evolve into a landslide.

Make sure to pay each amount by their due dates and don't be late on payments. If for any reason you suspect you'll be unable to pay the estimated amount of taxes, be sure to get in touch with a tax attorney and explain the situation to them. 

They can advise you on the best course of action to avoid falling under the penalty, or get in touch with the IRS to let them know about the situation. The worst thing you can do is to not pay the taxes and ignore it hoping the problem will go away on its own.

Wanna Be On Top? How Proper Communication Boosts The Bottom Line

Any business attempting to stay on top needs to focus on communication. It may not seem too important, but the reality is that communication can end up boosting our bottom line. The following are just a few ways you can improve communication within your company effectively.

Good Instruction Writers

An effective way to improve communication within your company is to make sure that all instructions are as clear as they can be. This means you need to hire good content writers to make sure instructions are as clear as possible. Errors could lead to confusion, and that is not good for a business because it can cause costly mistakes or even accidents.

Clear and Effective Contract

You are going to want to make sure that all contracts are written by a professional meaning that you are going to have to talk to a lawyer. Make sure this person understands business law before hiring him or her to help you jot down contracts. 



Creating clear contracts helps make better deals, and it helps foster relationships with third parties that can flourish for ages. For example, a Keep in mind that strong contracts can also end up protecting you should something go wrong.

Product Waste

Waste can lead to all sorts of problems later on. Not only do they cost money, but the possibility of finger-pointing also goes up. You do not want to be put in that position, but you can do something about it. For example, those who work with chemicals could use a chemical industry asset traceability solution that should help reduce waste. You could also use big data software though it does have to be specialized software to help your type of business.

Strong HR Team

A good HR team can also do wonders for a business because these are trained specialists who understand how to talk to personnel effectively. These individuals not only know how to make each person's voice heard but also know how to convey your company's positions in a way that is digestible. You want to have a good HR team to ensure that employees are appreciated and issues are dissolved with little problems.

Some of these suggestions may be difficult to initiate, but they are worth the effort. Your bottom line is what matters here, and optimizing communication within your company can get you where you want to be, so do not wait too long before you start optimize communication.

Getting Back on Track: 4 Benefits of Working with a Financial Adviser to Pay off Debt

When you are handling a debt, you can procure the services of a financial adviser. They have the necessary expertise to help you get your finances back on track. Since they are conversant with income tax preparation, investment management, and estate planning, their services might come in handy. Some of the benefits that will you get when working with a financial adviser to pay off your debt are as follows:

Planning for a Budget

When handling a debt, a financial adviser will help you to have a healthy financial future. They will help you to manage your debt by ensuring that you have a well-planned budget. A trustworthy financial adviser will analyze the cash flow of their client and identify the areas that are bound to bring about some challenges. 

A client should also present all the necessary documents that the financial adviser asks for since it will enable them to get a clear picture of the situation at hand. The essential documents include credit card bills, bank statements, installment loan statements, and tax returns. 

All these documents should be current since they will help the financial adviser to gain a better understanding of your financial situation. Although the financial adviser may criticize the spending habits of a client, it is good to own up to some truths. 

A client will also gain a lot after being issued a new balanced budget that will help them while paying off their debt. The client will also be able to avoid the piling up of debts. Although you will have to cut off unnecessary expenses, your existing debt will fade off progressively.

Restructuring and Analyzing Debts

Debts come about in many types. A mortgage is an example of a debt. The financial adviser can analyze the debts of their clients to formulate a suitable payback strategy. In this case, the financial adviser will ensure that the client will prioritize the debt that will bring about more additional costs. The debts with lower interests will be sorted progressively. Such options will be highly beneficial since you will not strain financially.

A Financial Adviser Helps To Formulate a Long-Term Plan

The main reason behind meeting a financial adviser is that you need assistance with clearing your debt on time. Although your main point of focus may be reducing your debt, other factors should be considered. A financial adviser is in a better position to formulate a long-term plan depending on the needs of their clients.

A financial Adviser Will Help You to Track Your Spending

When procuring the services of a financial adviser, you will have to be open about your earnings. You may produce relevant documents such as your paychecks. By looking at your earnings, the financial adviser will be able to compare what you earn against the debts that you have accrued. That way, they will be in a better position to offer some advice on how you can finalize the payment of each debt without straining financially.

Overall, a financial advisor can offer a lot of help while you are paying off debt. Many of them may use special platforms for financial advisers to help you keep better track of your finances. They will hold you accountable and come up with effective plans for helping you move forward.

International Partnerships: 3 Reasons NAFTA Boosts Our Economy

NAFTA was signed years ago, yet its impact is just now beginning to be fully realized. This one agreement essentially created the world's largest area of free trade, directly impacting more than 450 millions people. Linking the trade based economies of Canada, Mexico, and the United States has resulted in trillions of dollars in direct impact for each of the three countries. Here are three noticeable ways that NAFTS continues to boost our economy today.

Increased Trade Value

Since its signing in 1993, the value of trade between the three countries involved in NAFTA has increased more than four times over. This represents a real dollar value of $297 billion in 1993 to more than $1.17 trillion in 2018. 

This has resulted in economic growth and an increase in jobs across all sectors of society. When considering the United States alone, the values of exports to Canada and Mexico has increased from $142 billion in 1993 to more than $525 billion today.

Good Imports

The quality of the imports coming into America has increased as well. Mexican and Canadian manufacturers are putting out goods that Americans have grown to love and appreciate. 

Because all three countries are connected, this has effectively opened up international long routes for trucking allowing for international trucking companies like Glider Systems Inc to import goods to the US. That has opened up even more jobs, as the trucking industry continues to flourish. 




As NAFTA has evolved, the lessening of trade barriers means that international companies operating in member nations can freely move their goods across the borders. This benefits the consumer by giving them more choices, and it positively impacts the transportation sector as well.

Lowering of Prices

When tariffs are decreased, as they were under NAFTA, imports from the member nations will have lower prices as well. This means that consumers can buy more, which means more demand. The result is cyclical. A by-product of this has been a decreased risk of inflation. 

This has enabled the Federal Reserve Board to continue to keep interest rates low in the hope of further sparking the economy. Even food prices have become lower as a result of NAFTA given the fact that certain types of fresh vegetables, fruit, and beef can now move more freely across the three borders.

These three reasons alone highlight the boost that NAFTA has given to our economy. There are actually more advantages that can be cited as well. Since its signing in 1993, the impact of the trade agreement between the three major North American countries can definitely be felt in most sectors of the economy.

Selling Your Life Insurance Policy Does It Make Sense?

You might have bought life insurance to safeguard your family or business and supply monetary security when it was needed most, like lots of Americans have done. However, as situations change, your insurance coverage priorities might have changed with them, which is why selling your life insurance policy can make sense.

There are countless reasons you may wish to sell you life insurance policy. Which one is yours?

There are numerous reasons you may consider selling a life policy:

• The premiums are no longer affordable.
• The need to replace lost income in case of death of the insured no longer exists.
• A term policy may be reaching the end of the coverage period.
• Funds are wanted to improve a retirement lifestyle.
• The need for funds to pay estate taxes no longer applies.
• The need to eliminate future premiums payments but keep some life insurance. 
• There is a need for resources to pay for health expenses and long-term care. 
• A business no longer needs key-man insurance. 
• Premiums of policies owned by trusts continue to rise. 

Maybe selling your Insurance policy isn't the right thing to do:

Selling your life insurance can be the answer but sometimes it is not. In the panic of a financial crisis we sometimes jump to a conclusion without getting all the facts. The following is a list of alternatives to selling your policy, one may be right for you.

The sale of a life policy is not for everyone. There are alternatives other than selling a policy that may be appropriate for a policy owner’s circumstances:

• Keep the policy enforce through a loan or use of the cash surrender value.
• Seek an accelerated death benefit, if available.
• Assign the policy as a gift or charitable contribution.
• Covert a term policy to permanent insurance.
• Reduce the death benefit with a lower face value and lesser premiums.
• Lapse or surrender the policy.

Life insurance is an important asset, but with time you may find that your policy no longer matches your requirements-- your children are grown, you have medical expenses to cover, retirement costs are increasing, or premium payments are just too expensive.

Policy owners often grow out of the usefulness of their life insurance policies. And, traditionally, their only option was to lapse the policy or surrender it to the insurance provider.

But you have a much better choice.

You can sell your life insurance coverage policy. It's called a life settlement. And it supplies you with the chance to sell your policy for money you can utilize any method you desire, and even to keep a portion of your policy's survivor benefit without needing to make any extra premium payments. On average, policy owners can expect to get more than four times the policy's cash surrender value.

 Learn More - What is a Life Settlement? 

A Guide on How to Track your Personal Loan Status

An unsecured personal loan is one of the widely availed finances in India, with around 13.9 million accounts alone in Q1 of 2018, according to CIBIL. The total amount of unsecured credit (personal loans and credit cards) at the end of FY2018 amounted to $82 billion.

The increasing popularity of personal loans is primarily because of the changing lifestyle of Indians, their growing needs, and increasing consumerism. Individuals use these loans to fulfill various objectives, from hosting a wedding to buying a 4-wheeler or going for higher studies or medical emergencies.

The easy and quick availability of unsecured personal loans has also made it hassle-free to avail of them. Moreover, financial institutions offer several features and benefits with these products.

How to check loan application status?

You can check the status of your personal loan from the lender’s website. Usually, financial institutions have a dedicated page that tells you about your loan status. The information that you have to provide may differ from the company.

Checking the status of your revenue based loan is crucial after you apply. You have to know whether your loan application is approved or rejected. And I think Nucleus Commercial Finance would be a great fit here. They've been around since 2011, and they combine the stability of open banking with the flexibility and speed of alternative lending platforms.

Some of the general data that you have to provide include:

• Application ID or Reference number
• Form number
• Name
• Date of birth
• Mobile number
• Product type
• Loan amount requested
• PAN

Clicking the “Submit” button will enable you to learn your unsecured personal loan status.

What are the features of personal loans?

Personal loans can come with the following features:

High financing option

You can avail of up to Rs. 25 Lakh with personal loans. Also, lenders don’t require collateral to sanction these loans.

Instant approval and disbursal

NBFCs can approve personal loans in 5 minutes. They can also disburse it within 24 hours or one working day.

Nominal documentation required

Financial institutions only need your KYC documents (Passport, Driving License, Aadhaar, PAN, Voter ID), employee ID card, bank account statements of the last 3 months, and salary slips of the previous 3 months for the approval procedures.

Simplistic eligibility criteria

The eligibility criteria for personal loans require you to be between 23 and 55 years of age and employed with a private/public company or MNC.

Flexi Loan facility

Bajaj Finserv also has a Flexi Loan facility. With this facility, you have to pay interest only on what you withdraw from the sanctioned loan amount. You can also pay only the interest as EMIs. Repay the total amount of funds withdrawn at the end of the tenor.

The Flexi Loan facility lowers EMIs by as much as 45% compared to traditional personal loans.

Pre-approved offers

Lenders bring pre-approved offers on Personal Loans that save you time when availing of financing by making the process hassle-free. Pre-approved offers are valid on home loans, business loans, personal loans, and a range of other financial products & services. You only have to provide a few essential details to check your pre-approved offer.

What are the things to remember before applying for a personal loan?

Do remember these few things before you apply for a personal loan:

Opt for a reasonable amount

Financial institutions may reject your application if you apply for a high amount. Hence, it is recommended to use a personal loan eligibility calculator. It will help you learn the highest loan amount you are eligible for as per your income, outstanding credit card debt, and loan EMIs.

Calculate your EMIs

Calculating your EMIs helps you to know whether you will be able to pay them. Use an online EMI calculator if you don’t know how to calculate personal loan EMI. Have a high credit score

Lenders need a credit score of 750 or more to sanction you a personal loan. Improving the credit score requires only a credit card. You can also avail of a secured credit card by pledging a fixed deposit as collateral.

Paying the total amount due within the deadline and utilizing 30% to 50% of your credit limit will improve your credit score.

You must lower your fixed monthly obligations

Ensure that the ratio of your monthly income to your fixed monthly obligations is lower than 50%. Closing your existing loans and clearing your credit card debt can help you achieve this ratio.

Opt for an unsecured personal loan today to fulfill your financial goals. Financial institutions give you the option to apply for these loans online. You only have to provide your personal details, income, and a few other basic details to apply successfully.