Hybrid Option Arm Mortgages

The reality of today’s market is that interest rates are higher than rates from the past few years. What this means for first time homebuyers, real estate investors, and property owners with adjustable rate mortgages is that monthly payments for the traditional 30 year mortgage are becoming more and more of a financial burden.

Fortunately, for current and prospective homeowners who have good payment histories over the last two years and credit scores above 620, an emerging product is making monthly payments for mortgages both affordable and safe.

Hybrid Arms

Similar to Option-Arm mortgages, Hybrid Arm mortgages have 4 different options for monthly payments. These options are:

1.Minimum Payment - minimum payment—can lead to negative amortization.
2.Interest Only Payment - payment on only the interest of the mortgage
3.15 year Amortized Payment - payment towards the principal and interest based on a 15 year term
4.30 – 40 year Amortized Payment - payment towards the principal and interest based on a 30 or 40 year term

The primary difference between an Option-Arm mortgage and a Hybrid Arm mortgage is the length of time the minimum payments and interest rates in a Hybrid Arm are fixed. ption-Arm mortgages typically have fixed interest rates of 1 to 3 months. In contrast, Hybrid Arms have fixed interest rates between 1 and 7 years.

What this means for homeowners is that the benefits of Option-Arm mortgages are now combined with the security of longer termed mortgages.
For example, a homeowner with a 200,000 5-year adjustable mortgage pays $1467.00 before her taxes and insurance. With a 5 year Hybrid Arm, the homeowner would pay $800 a month on the same mortgage. The savings on the minimum payment would be comparable to the savings of an Option-Arm mortgage.

However, for an Option-Arm mortgage, the minimum payment would increase after 1 to 3 months, leading to minimum payments above $800. With a Hybrid Arm, the minimum payment would remain at $800 for the 5 year term. For the homeowner, this means a more predictable monthly payment and a reduced risk for negative amortization.

Hybrid Arms (also known as Hybrid Option Arms and Fixed Option Arms) typically save homeowners about 55% of their typical monthly payments. They are powerful tools to save money and ensure financial freedom. To see if you qualify for a Hybrid Arm, contact a mortgage professional today.

Comparing Fixed Rate, Hybrid Arm, Pay Option Arm And Hybrid Option Arm Mortgages

With all of the options available to homeowners today, adjustable rate financing is a common topic of discussion at our offices. The 3 most popular Adjustable Rate Mortgage (ARM) types today are Hybrid ARMs, Option ARMs, and Hybrid Option ARMs. Sound pretty similar don't they? There are similarities, that's for sure, but there are differences as well.

Hybrid ARMs

Hybrid ARMs are a cross between a traditional fixed rate mortgage and a classic ARM. They generally come in varieties indicating how long they are fixed for, and how often they adjust thereafter. For example, a 3/1 ARM will have a fixed rate for the first 3 years, and can then adjust once every year thereafter. A 2/1 would be fixed for years and adjust every year thereafter, a 5/1 fixed for five years, 7/1 for seven and a 10/1 for ten.

All adjustable rate mortgages are calculated using an index, such as the MTA, the COFI, the COSI or the LIBOR. MTA and LIBOR are most popular. These rates indicate a basic borrowing cost of capital for the lender, this is how much it costs them to lend money in a perfect world. They also have a margin, which is like a risk premium, their profit for making the loan.

Hybrid ARMs have basic characteristics including:

1. Start Rate which remains fixed for X amount of time, so a 3/1 lasts 3 years and adjusts every year thereafter

2. Adjustment Cap Structure which dictates how much the rate can change when the loan begins adjusting. A 5/1/5 adj. cap structure means that the 1st time the rate adjusts it can go up or down 5 points max, any subsequent adjustments are limited to 1 point up or down, and the rate can never go up or down more than five points.

3. Floor: a rate which the note rate or fully indexed rate can never be lower than. (usually the initial fully indexed rate)

4. Ceiling: a rate which the note rate or fully indexed rate can never go higher than (usually 9.95 to 11.95 depending on lender and index)

The minimum payment on a 100,000 dollar regular Hybrid ARM with a 7% rate would be a bit over 665 dollars, and borrowers of all credit levels qualify for Hybrid ARM type mortgages.

5. One Month Option ARM: Option ARMs are one of the most popular loan types in today's market, and for good reason. Option ARMs are like regular ARMs, but they have 4 payment options instead of just the one fully amortized payment option on a regular mortgage. The minimum payment option is the main point of attraction for majority of the Option ARM customers in the USA today, because it allows them to make smaller payments when cash is tight. The minimum payment for the initial period of the loan for 100,000 dollars would be 322 dollars, versus 665 dollars for the full payment on a conventional mortgage. A great option for the self employed, the small business owner.

On 1 month option arms, they adjust every month after the initial period, so if the initial period is 6 months or 1 year, then every month therafter the rate adjusts. There are 6 month and 1 year option arms wherein the payment adjusts every 6 months or 1 year thereafter as well, however 1 mo arms are most popular. They have additional features in addition to standard Hybrid ARMs:

6. A Minimum Payment: a payment which like a credit card allows you to stay current on the mortgage without paying the full amount of interest due, referred to as deferring interest

7. A Minimum Payment Adjustment Cap: the maximum amount that the minimum payment AMOUNT can increase or decrease in a given period. Typically 7.5%. So if your minimum payment is 1000 dollars, then in the next period it can not go higher than 1075 dollars.

8. a Negative Amortization Cap: This is the maximum the loan balance is allowed to increase due to deferral of interest (making the minimum payment only) before the loan is re-cast and the minimum payment option goes away. Depending on state and LTV this is 110% to 120% of the loan amount.

Option ARM Example: On a $100,000 Option ARM with a 1% start rate, a base or index rate of 4% and a margin of 4%,

- Minimum Payment = 322
- Interest Only = 667
- Deferred Int. = 345 (IO minus Min Pay)
- 1 Year Neg. Am. = 4140
- Recast Balance = 115000 (assuming 115% neg-am cap)
- Months to Recast= 43 (assuming you only make the minimum payment)

When a regular option arm exceeds its negative amortization cap and recasts (typically in 3 and half to 4 years if you're only making the minimum payment) the minimum payment option goes away, and you are left with the fully amortizing payment, although some products are beginning to extend the availability of the interest only option for up to 10 years. Because of the incredible flexibility of these loans, they are limited to higher credit borrowers (generally a FICO score of 660 is required, however certain programs are available for borrowers with FICOs of 600 or better).

Hybrid Option ARMs or Fixed Rate Option ARMs

Hybrid Option ARMs combine some the best features of Hybrid ARMs, such as medium term fixed rates, with the best aspects of Option ARMs, such as low minimum payments, while solving a lot of the problems with both for the average borrower. They are most popular with homeowners who want the stability of a fixed rate mortgage but the option to make very, very low minimum payments, and are considered an ideal compromise between "safety" and "flexibility" in the mortgage world.

Hybrid Option ARMs are generally based on normal Hybrid ARMs, in that their initial period is usually 3/1, 5/1, 7/1 or 10/1 meaning 3, 5, 7 or 10 years where the rate and minimum payment stays fixed, and 1 adjustment per year afterwards.

However they have Option ARM like features such as a minimum payment, minimum payment adjustment cap, and neg am cap. Using the above example the same loan amount in a typical hybrid option arm package

- Minimum Payment = 449 (assuming 3.5%)
- Interest Only = 583
- Deferred Int. = 134 (1/3 of regular option arm)
- 1 Year Neg. Am. = 1608
- Recast Balance = 115000 (assuming 115% neg-am cap)
- Months to Recast= 112 (assuming you only make the minimum payment)

Also, when hybrid option arms recast, most of them allow for an Interest Only option instead of forcing the borrower into a fully amortized payment they might not be able to afford. Along with the long recast timeframes and the fixed rates for the initial period, this substantially reduces payment shock on recast.

Wrapping Up

So we've discussed Hybrid ARMS, Option ARMs, and Hybrid Option ARMs, and will provide a variety of real world examples and detailed treatment of relevant topics in other articles in this series. And as always we welcome your questions and calls.

Should You Buy A House As A Student?

Maybe you’re tired of throwing away money on rent every month. Maybe you’re tired of moving every year when you need to find new roommates. But you’re still in school and you’re not sure if you’re ready to buy a house. Here’s the real facts on home ownership for students.

It’s a lot of responsibility

If you are the type of person who would rather call somebody when there’s a problem, then home ownership might not be for you. On the other hand, if you’re going to be living right near your uncle who’s a great handy-man, or your mom, who knows all about houses, then, you might consider buying a house.

When you own a home, you don’t necessarily need to do it all yourself. However, it will be cheaper to do it yourself, and sometimes you are going to want to at least try to fix problems. Other times are just times when you need to call a plumber. But you don’t want to have to pay a hundred dollars and then find out that the plumber fixed the problem with only a plunger.

Consider the payments

If you don’t have a steady income, chances are that you won’t be approved for a mortgage unless you are applying with somebody (a partner, a roommate, a parent) who has a steady income. If you don’t have a steady income, you are going to have to consider how you are going to make your mortgage and bill payments each month as well.

Some students buy houses close to campus and then they rent out rooms to other students. This can be an easy way to make your mortgage payments each month, and sometimes even to keep a bit left over for you. If you are going to rent out rooms in your house, you might want to make sure that there is phone and internet available in each of the rooms. You will also want to think about the way you will set up the finances. It could be easier to charge a flat rate than to figure out how you are going to split the utility bills each month. Will you share the internet? Will you share the phone? How will you sort out long distance? Some people wont’ want to share the phone because they have cell phones. Other people might want their own line into their room. It all depends on who you are planning on living with, but these are just some of the things that you will want to sort out before you start advertising having a room to rent.

The initial outlay

Buying a house is going to be more expensive than you think it will. You might want to paint rooms. You will have to buy household objects that you never thought you would need. (Does your basement need a dehumidifier? Do you need shoe racks from the front hall closet? Are appliances included?—These purchases will all add up to more than you had budgeted for in the first place.) Some places, such as Canada, require lawyers to complete paperwork for each and every house that is sold. This means that you will have to pay at least a thousand dollars for lawyers’ fees. You will also have to pay land transfer tax which could also amount to thousands of dollars. Sit down with an expert to discuss the real initial costs of buying a house, and make a good budget. Then you will be able to make an informed decision about your purchase and decide a good amount of money to set aside. It is better to overestimate these costs, because any leftover money you will be able to put down on your mortgage.

The time

Owning a house takes time: cutting the grass, keeping it clean, paying the bills. As a student, you might not have a lot of time. If you are already pressed for time, then think about how much busier you will be when you buy a house and one day the fridge breaks down.

Your choice

In the end, buying a house can be a great decision for students—or it can be a disaster. It depends on your financial goals, where you are financially now, and the type of person that you are.

Everlasting Mortgages

What does the term “inter-generational mortgage” mean to you? If you’re not up to date, then read on for more information on this revolutionary move. It seems that there is a distinct possibility that lifetime interest only mortgages, which we could pass on down the family, may be the answer to a lot of home buying problems and worries.

The way the scheme works is the borrower takes out an interest only mortgage. This means that your monthly repayments are for interest only and no part of the original sum borrowed is repaid. Monthly interest payments are appreciably lower than that of a repayment mortgage. If you borrow £100,000 the saving on repayments could be around £130 per month.

A major feature of the scheme is that it means that your children will be able to inherit your home and very much reduce the dreaded inheritance tax. In the event of your death the mortgage could pass on to your children, or other beneficiary.

On your death the mortgage passes on to your children, who have the choice of either continuing the mortgage payments and moving into the house or selling the home and repaying the loan. They could choose to live in the property, treat it as a buy-to-let or maybe a holiday home for family use. The implications of this as regards inheritance tax are interesting as only the value of the house, less the mortgage amount, would be counted as part of your estate.

There is no time limit on the mortgage and your children could continue to enjoy the property for as long as they wished. Your first reaction to all this may be that you don’t want to pass debts to your children but in fact these mortgages are extremely popular in other parts of the world. The careful Swiss have found it works well for them and they’re not known for anything but neat, tidy and methodical practices, whether it is for sourcing mortgages or making cuckoo clocks! If it helps to you both pass on your home to your dependants and also reduce the amount of your hard earned money paid to the taxman, then it’s got to be worth some careful thought.

With more and more estates coming into the inheritance tax bracket (£285,000 in 2006) someone living in a relatively modest house could be affected by this tax. Many older people would be amazed to think that their estate could fall into this category.

It’s an increasingly common situation for older people to take out equity release schemes where they raise money against their home’s value to enable them to live more comfortably in retirement. These schemes can be really expensive. A mortgage which can be passed on to their children could be a far better bet. The interest rate would be much lower and this in turn would give them money to spend on themselves and they could have the pleasure of helping their children and grandchildren in their lifetime. Assuming that the equity in their home is greater than the mortgage, their children are still inheriting an asset worth more than the debt.

It looks as though we’ll be hearing a lot more about inter-generational mortgages. For more information and help on this and other mortgage choices we recommend you get on line and get some independent advice. You never know, they might eventually come up with a more user-friendly name for it ……maybe the everlasting mortgage will catch on.

Mortgages - An Important Date

A helpful reminder from your mortgage broker may be just what you need to save yourself a whole lot of trouble. The FSA (Financial Services Authority) is very happy with the way rules for renewing two or three year home loans are working out, but mortgage brokers tell a different tale and are less impressed, saying that borrowers are confused and could be out of pocket over the system.

When your short-term mortgage is coming to an end it would be helpful if you could rely on your lender to send you a reminder. Although some do, they’re not actually under any obligation to send you this information. They do have to inform you that the interest rate is to alter, with the obvious result of an increase in repayments. Unless, of course the rate comes down, which would probably be as likely as a flying pig? The rate they’ll be offering you will be their standard variable rate, which is likely to be something like 2.25% higher than the rate you’ve been on.

If you find yourself in the position that you have actually inadvertently switched to SVR, you’ll need to do something about it as soon as possible. For some-one with a £100,000 loan, switching from a standard variable rate deal can expect to save around £1,000 per annum for each one-percentage point reduction in their interest rate.

On average, it will take four to six weeks to re-mortgage with an alternative lender. Make certain that you allow at least this time to have everything in hand to change lenders in plenty of time, to plan an easy change-over. The FSA recommends that you study the “Key Facts” document which you will have received at the start of your mortgage. This will give you the date that your loan comes to an end. They recommend that you make a note of it.

Lenders vary, some will give you about three months notice, which is fine, some will write to you a few weeks before, which may mean a period on the higher rate whilst you’re making arrangements. Remember, some won’t write at all.

Whilst it makes sense to shop around for a similar, or preferably lower, interest rate to your current one, don’t dismiss remortgaging with your present lender out-of-hand. There will be a saving on exit fees, often around £300, valuation and legal fees if you stay faithful. It’s worth checking on what their offer would be.

Competition is strong on the mortgage front. All the companies would like your custom and you may find some will help with the costs of transferring the mortgage by meeting valuation costs and the legal costs to tempt you to switch to them.

The advantage of using a mortgage broker is that they’ll do all the research for you, finding the best deals and weighing up all the different aspects of your loan. Form filling will be kept to an absolute minimum too, once you’ve given them your details. When the time comes to renew the mortgage they’ll seek out the best deal again and let you know what they’ve come up with.

Mortgages - Short Term Memory

so, it’s very easy to set up the monthly repayment and then get involved with so many other aspects of your life that time slips away and before you know it, the two or three year period of your loan is coming to an end. Whilst many lenders write to their customers towards the end of the loan period, it isn’t compulsory.

When you sign on the dotted line for your mortgage deal, you are issued with a key facts mortgage document which will include all the loan details together with the all important date that your fixed price deal will come to an end. If you forget this date and also fail to receive a reminder, the first thing you’ll become aware of it a notice of a change in monthly re-payments, which means that you’ll be going on to the lender’s usually expensive SVR, or standard variable rate.

As an example, on a loan of £150,000, you could easily be paying out a substantially higher amount - more than £200 a month extra. This is assuming that the SVR is 2.25% more than the “special rate”, which would not be unusual.

Obviously most borrowers would opt to change to an alternative short term mortgage, but it takes between four to six weeks to arrange this change-over.
If you are extremely diligent at remembering to take action you may run into problems too as if you ask what your options are when there’s more than a month or so to run, your lender will very often say they’re unable to make a decision until nearer the date. Then you’ve been stalled and still can’t make a decision.

There has been some improvement in the way insurers are handling the situation. An increasing number of them are contacting borrowers around three months before the end of their current deal and setting out options.

It’s not always the right thing to automatically change to another lender to get the best price. Consider your options carefully. If you stay with your current lender, there will be a saving on legal charges and you shouldn’t need another valuation. Nor will exit fees be charges, which could mean a fairly big saving. It just could be that a slightly more expensive deal with your current lender may work out best in the long run.

Because of this and with the intense competition in the re-mortgaging business, it’s becoming increasing common to find new lenders who will fund the charges, just to get your business.

If you used a broker to arrange the mortgage, you may well find that they’ll send you a friendly reminder. This is a service which will be no problem for them and another thing less for you to think about, which has to be good news. Your broker will weigh up the deals and come up with some facts and figures when it comes to renewal too. The internet’s the place to look and an on-line broker’s the person to look for.

Getting Rid Of Tax Debts In Bankruptcy

Ask ten people if you can discharge tax debts in bankruptcy and you will get ten different answers. The correct answer is that you can, but only if certain tests are met.

Getting Rid of Tax Debts in Bankruptcy

Bankruptcy is the great financial white board for Americans. It essentially serves as a get out of financial jail card, a chance to start over after we have made a complete and utter mess out of our financial life. Even better, you can refile every seven years. Only in America!

While bankruptcy is a tool that can be used to get people out of a tight financial spot, it is not a cure for all of your debts. Student loans are one type of debt that is notoriously difficult to wipe off your books. In this same vein, tax debts are another area that is shrouded in mystery. Well, let’s provide a little clarity.

The good news is tax debt can be discharged in bankruptcy. Discharged simply means the debt is canceled and cannot be collected now or in the future. The bad news is you must meet a number of criteria before the court with give the IRS the boot. So, what are the criteria?

1. Filed Returns – You must have returns on file with the IRS for the years in dispute. If you never filed returns, you will not receive a discharge.

2. Late Returns – If you filed your tax returns late, can you still get rid of the tax debt? Yes, but only after two years have passed since you filed the return with the IRS. This requirement often is where people run into problems when trying to discharge their debt.

3. Three Year Rule – The tax debt in question has to be for a return that was due at least three years in the past. You cannot file bankruptcy in 2007 and try to discharge a 2006 tax debt.

4. No Fraud – Your tax debt cannot be related to fraud, to wit, you must owe back taxes because you failed to pay them, not because you played funny on your tax return.

5. No Tax Evasion – Again, your tax debt cannot be due to a criminal act. If you stuffed money away in a Swiss bank account and the IRS found it, the bankruptcy court is not going to discharge the debt.

6. Assessment – 240 days must have passed since the IRS assessed the tax due. This essentially means the day the IRS arrived at a number you owe.

These 4 Last-minute, Year-end Tax Strategies Can Save You Money

FSI Tax Corp is alerting taxpayers to end-of-the-year actions they can take to reduce their 2006 tax bills. After the New Year, it will be too late to take advantage of many tax-saving opportunities, such as reducing 2006 income, exploring available tax credits and pursuing all legitimate 2006 write-offs.

1. Minimize your income

Because you are taxed on your yearly income, the simplest way to decrease your tax bill is to decrease your income. It may not sound like that’s a strategy that could save you money, but postponing income until 2007 can reduce your taxable income for 2006.

If you have clients, you can delay your invoices or push back due dates until after January 1, 2007. Unless a financial hardship requires immediate funds, wait a couple of weeks. It won’t count as income if you don’t receive it during this year, but you will still receive what you are owed. You will give your clients a needed break over the holidays and your patience will pay off in April. If you are an employee, see if your employer can delay your holiday bonus until after the New Year.

2. Tax Credits

People tend to focus on deductions more than tax credits when it comes to planning for tax season. However, there are many tax credits available that, if you qualify, can save you a lot on your tax bill. Below is a list of tax credits; detailed explanations of each credit can be found on the IRS website.

• Retirement Savings Credit: Available to low to moderate income level taxpayers who contribute to a retirement savings account. This credit can save up to $1,000 or $2,000 if filing jointly.
• Credit for Elderly or Disabled: Taxpayers earning a limited income may qualify for this credit if over 65 years old or permanently disabled.
• Adoption Tax Credit: If you adopted a child this year, you may be eligible for this credit which repays adoption expenses up to $10,639 in 2006 or about $5,000 for each adopted child.
• Child Tax Credit: Low-income parents with children under 17 years old may qualify.
• Child and Dependent Care Credit: This is for parents who have children under 13 and place their children in daycare or with babysitters so the parents can work.
• HOPE Credit: Students may qualify for a tax credit of up to $1,500 for tuition and fees assistance.
• Lifetime Learning Credit: A credit of up to $1,000 for which students (including part-time students) and students not in school due to pursuing a post-secondary degree or for a business purpose may qualify.

The Energy Tax Incentives Act was signed into law in August, and while critics of the law argue it is aimed at providing benefits to big energy companies, it also includes tax credits for consumers. Under the new law, taxpayers can take a credit for:

• Energy efficient home improvements, like insulations of windows and doors.
• Solar energy equipment for residences.
• Hybrid, fuel cell and other energy-saving or alternative energy using vehicles.
• Other energy equipment purchases, such as electric heat pumps and water boilers.

3. Deductions

In addition to delaying income and taking advantage of tax credits, loading up on deductible expenses in 2006 can also reduce your taxable income. Taxpayers need to be careful to only include legitimate deductions because every deduction will be scrutinized by the IRS. Here are a few ideas:

• Prepay your state and local taxes. If you withheld state and local taxes this year, and you plan to itemize, it would be advantageous to prepay the taxes now and the payment will count as a federal deduction.
• Increase your 401(k) contribution to cut your taxes and increase your retirement savings. Some 401(k) plans permit “catch-up” contributions in lieu of yearly contribution maximums. According to SmartMoney.com, a taxpayer in the 28% tax bracket can save $280 by contributing an extra $1,000. You are getting paid to save!
• Include additional deductible mortgage interest by paying January’s mortgage bill now.
• Don’t postpone paying tuition and university fees. Pay for next year’s education now and save. In some states, contributions to your 529 college savings plan can also be deducted.

4. Donate to Charities

The holiday season is a “season of giving” and a great time to donate to your favorite charity. Not only does it feel good to give to the less fortunate, but you can help yourself by donating before January 1st and including the contribution on your 2006 tax return. For more information on charitable donations visit http://www.irs.gov/newsroom/article/0,,id=164997,00.html.

You can also donate stock to charity, avoid paying taxes on the appreciation and deduct the full value of the stock.

For taxpayers looking for maximum generosity and time to consider how to give back, a donor-advised fund may be the answer. For a contribution of at least $10,000, you can deduct the entire amount now and disperse the funds over time.

Year End Tax Savings For Cash Basis Taxpayers

There are only a few days left in the year. So now is the time to take those last minute tax savings.

Disclaimer: I am not a lawyer, nor do I play one on TV. So do your due diligence and either check with your CPA, tax planner, or the IRS site.

If you are a cash-basis taxpayer, as many sole proprietors are, you claim expenses as they are paid. Likewise, you claim revenue as you deposit it.

So take a quick look at your annual Profit and Loss statement and decide: Do you need more revenue or more expenses?

Now I'm not talking about making more money. I'm referring to when to claim the money.

If you are facing relatively low income for this year, as compared to what you think you will have next year, then you may want to move as much revenue into this tax year as possible. So gather up all those checks lying around and head for the bank. Send out invoices via paypal to vendors who may be willing to pay you this year. Call people who may already have an invoice they could pay. Pull as much revenue into this year as possible.

On the other hand, if you've made more money this year than you planned - and you may have "forgotten" to file estimated income tax, then let's move some expenses into this year. Otherwise, you'll have to claim more income - and perhaps pay a penalty for the estimated tax you missed.

Stock up on office supplies. From paper to pens to file folders, you can use these items "next year." But you can pay for them this year. And don't forget the calendars and tax software!

Prepay expenses. If your insurance is due on January 12, go ahead and pay it now. (Remember, this only applies to cash basis taxpayers!) Look at all of your other payments and pay them now.

Buy equipment that you can expense. As a Section 179 expense you can expense any piece of equipment up to a total of $108,000! (Be sure you read the IRS document on Section 179.)

Buy an SUV. No, I'm not kidding. Any vehicle over 6,000 pounds can have $25,000 of its cost expensed in Section 179. (You have to purchase and put it into use before the end of the year. If it's not practical this year, remember this tip for next year.)

Pay your employees and contractors at the end of the year - even if it's not their regular payday.

If ever there is a deadline you want to meet, it's the end of the year. There is no putting it off till tomorrow. Taking action can make the difference between paying a penalty or getting a refund. So take the next hour and get your tax savings!