MONEY Taxes

Here’s How Much You Really Pay In Taxes

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John Kuczala/Getty Images

Americans will pay an average of 20% of their income in federal taxes this year.

Nearly everyone hates paying taxes, but you may be kind of fuzzy on how much in total you ship off to Uncle Sam.

For example, you might know that you’re in the 25% tax bracket, but that doesn’t mean you hand over 25% of your pay—that’s a marginal rate that applies only to part of your income. You also have to subtract out deductions and credits, and then add in taxes that aren’t part of the income tax, like for Social Security. Fortunately, the Tax Policy Center has been doing the heavy lifting of keeping track of all this, and it’s just put out some new numbers.

On Monday, the nonpartisan research group released information on the 2015 tax year based on an update of the model they use to calculate what people pay. According to the Center’s data, Americans will pay an average of 19.8% of their income in taxes to the federal government. That number doesn’t include state taxes or city taxes (we’ve got those in NYC.)

As you can see, most of your tax dollars come from income tax and payroll tax, with a little bit going to corporate tax. Why is an individual paying a tax that’s reserved for businesses? Well, Mitt Romney wasn’t totally wrong when he said corporations are people—at least for the purposes of tax policy. In the end, a corporate tax has to make a flesh-and-blood person somewhere less wealthy than they’d otherwise be. The center’s model takes into account the fact that even non-CEOs indirectly pay some corporate tax, partly in reduced wages but mostly through lower returns to investors and business owners. (Not surprisingly, people in higher brackets effectively pay more in corporate tax.)

While the average tax burden is 19.8% of your salary, most people actually pay less because that number is skewed by high earners. So the Tax Policy Center also breaks out the average federal tax burden by income bracket, so you can see how much of your income you’ll likely be shelling out this year.

 

TIME jeb bush

Tax Returns Show Jeb Bush Did Well After Being Governor

Republican presidential candidate and former Florida Gov. Jeb Bush answers questions from employees of Nephron Pharmaceutical Company June 29, 2015 in West Columbia, South Carolina.
Sean Rayford—Getty Images Republican presidential candidate and former Florida Gov. Jeb Bush answers questions from employees of Nephron Pharmaceutical Company June 29, 2015 in West Columbia, South Carolina.

The 2016 White House hopeful made hefty paychecks—and has tax bills to match.

Former Florida Gov. Jeb Bush is trying to make history. No, not as the third member of the Bush clan to win the Presidency. He is going for something easier: releasing his taxes, and more of them than any other White House hopeful ever.

The 2016 contender for the Republican Party’s White House nomination on Tuesday released 33 years of his tax returns, a move his campaign touted as a demonstration of his transparency with voters. It follows a trove of emails he released from his time as Florida’s Governor, between 1999 and 2007.

“This release will show voters how I earned a living over the past three decades and how much of that living I had to give back to Uncle Sam. Spoiler alert: a lot,” Bush wrote. He added: “In my case, I paid the government more than one in three dollars that I earned in my career. Astounding.”

Yet the motive behind the release was not as simple as promising a first-hand reasoning why he wants to lower taxes, or as pure as letting Americans look under the hood at his family’s income. Throughout the commentary that accompanied the release, he continued to criticize the Democrats’ front-runner for the nomination, Hillary Clinton. She and former President Bill Clinton, too, have made millions as members of another well-connected family dynasty. “I have paid a higher tax rate than the Clintons even though I earned less income,” Bush wrote in a blog post about his tax returns.

A complete picture of Bush’s 2014 income was not included in those documents, however. He requested an extension on his federal 2014 tax returns, which are due by October 15, 2015. He also received a 45-day extension on the required personal financial disclosure required of presidential candidates.

Hillary Clinton released eight years of returns in 2008, but has yet to release her latest financial figures beyond the mandated filing of her assets with the Office of Government Ethics, but her campaign says she will release both in due time.

Bush’s 33-year release is a new record in American politics, topping the one set in 1996 by then-Sen. Bob Dole, who released 30 years of returns. Then-Gov. George Romney of Michigan released 12 years’ worth in 1968. More common has been to release just a few years. In 2012, former Massachusetts Gov. Mitt Romney only released two years of returns, totaling hundreds of documents detailing complicated financial positions lingering from his time as a private equity executive. Sen. John McCain also released two years of returns in 2008. Romney and McCain each had other disclosures available through forms they had to complete as state- and federal-level officeholder.

Since leaving office in 2007, Bush has earned about $23.6 million from speaking fees, board memberships, and a range of consulting and business ventures. His net worth is somewhere between $19 million and $22 million. Both sums are substantially lower than what the Clintons have earned, but not so low as to distract from the fact that they’re both very well off. Most people seeking the White House are, after all.

Bush took care to emphasize that his average tax rate, 36 percent, was greater than Bill and Hillary Clinton’s 30 percent in 2014. (By comparison, the Congressional Budget Office says the average American pays 17.6 percent of income in federal taxes.) Yet there were four years, 1985-88, when he had a tax rate of zero because he took such a loss on investments. In two years, he had no tax liability. In three years, he had net negative income. “Over those years my income fluctuated based on our successes, failures and the bumpy Miami real estate market,” Bush wrote.

Bush donated $739,511 to charity from 2007-13, for a charitable contribution rate of 3.1 percent. But Bush claims to have helped raise tens of millions more as a board member of several charitable organizations, including the Barbara Bush Foundation Celebration of Reading foundation.`

According to Bush spokesman Tim Miller, Bush earned $2 million annually from Barclays Capital, where he served as an adviser from 2009-2014, and $1.3 annually million from Lehman Brothers for his work there in 2007-08.

During the window the documents cover, Bush earned roughly $38 million net income. He also paid almost $13 million in taxes—more than 250 times what the average American worker earns this year.

MONEY Taxes

Why You Can Stop Worrying About the Gift Tax

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Tiina & Geir—Getty Images

You're more likely to be mauled to death by a unicorn than to actually pay gift tax to the federal government.

Most taxpayers will never have to pay federal gift tax regardless of the size of the gift.

I frequently get questions from clients wanting to know how much they can give to their children without incurring “gift tax.” So let’s clear this up: For 99.8% of Americans, under current tax law you are more likely to be mauled to death by a unicorn than to actually pay gift tax to the federal government.

The gift tax was designed to prevent people from avoiding federal estate tax by simply giving their money away prior to death. Here is how the gift tax works.

If you give more than a certain amount in a given year to any one individual (this amount is called the annual gift tax exclusion, and it’s $14,000 in 2015), you are supposed to file a gift tax return. If you are married, you and your spouse can each give $14,000 to an individual each year. That means you can give a combined $28,000 to as many people as you like. Most people understand this part but then fret over what happens if they want to give more than the annual exclusion.

Well, as I already mentioned, if you give more than the annual exclusion amount, you are supposed to file a gift tax return. However, that does not mean you owe any tax to the government. Remember that the gift tax was designed to keep people from avoiding estate tax. Federal estate tax applies only to estates of more than $5.43 million ($10.86 million for couples), and the gift tax shares this “unified credit” with the estate tax. Therefore, when you file a gift tax return, you can either pay the tax out of your own pocket or apply part of your unified credit toward the gift and erase the tax.

This essentially means that the only people who actually pay gift tax to the government are people with very large estates — the 0.2% whose estates are larger than the unified credit amount. Anyone else will file a gift tax return and use part of their $5.43 million or $10.86 million unified credit to avoid gift tax.

This means that a married couple making a $100,000 gift to someone — a child, say — settles with the IRS as follows:

Gift: $100,000

Minus annual exclusion amount: $28,000 (2 x $14,000)

Taxable gift: $72,000

Unified credit (for married couple): $10.86 million

Minus credit used to avoid gift tax: $72,000

Remaining credit: $10.14 million.

So unless you plan to leave more than $5 million or $10 million to your kids at death, worrying about gift tax should be the furthest thing from your mind! But watch out for renegade unicorns. I hear they get aggressive during mating season.

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MONEY Love and Money

What the Same-Sex Marriage Ruling Means for Couples’ Finances

7 things that will change how couples manage their money

The much-anticipated Supreme Court ruling on same-sex marriage has been decided, with the majority of judges declaring it a constitutionally protected right.

While 37 states previously recognized same-sex marriages, today’s ruling means that no state can ban same-sex marriage, or refuse to recognize a marriage performed legally in another state.

It also heralds big changes in the way same-sex couples manage their finances. Since the court struck down a key part of the Defense of Marriage Act in 2013, couples who were legally married in a state that recognized their union have been able to file joint federal tax returns and receive other federal benefits. Today’s decision extends that ruling to the rest of the country and affects a host of other financial issues, including Social Security, estate taxes, and retirement planning. Here’s a rundown.

Income taxes: Married same-sex couples in any state can now file joint federal returns. Those already living in states where gay marriage is legal know that this can be a mixed blessing, because in some cases filing jointly could trigger a higher tax bill. Typically, the more disparate a couple’s incomes, the more likely spouses are to benefit from filing jointly, says financial planner Stuart Armstrong II, who married his partner in Massachusetts in 2005. If filing together results in a lower tax bill, Armstrong advises looking into filing amended returns for the past three years.

Social Security: Now that same-sex marriage is legal in all states, couples can access spousal benefits no matter where they may be living at the time they file. That’s a big deal when it comes to retirement security. A recent analysis by investment advisory firm Financial Engines found that a same-sex couple could receive an additional $20,000 to $250,000 in lifetime benefits from Social Security by taking advantage of spousal and survivor benefits that were unavailable to them as single filers.

Estate taxes: Before the DOMA case, same-sex spouses could not transfer property to each other without potentially owing federal gift tax, nor could they inherit assets without paying federal estate tax (if the estate was large enough to trigger the tax). Now there is no limit on the amount spouses can give each other, during life or through an estate plan, without incurring taxes. They’re also entitled to the married couple’s estate tax exemption of nearly $11 million for 2015.

Employee benefits: In the past, partners of people employed by small companies were unlikely to have access to their mate’s health insurance or other benefits, a situation likely to change with federal recognition of same-sex marriage. But even at companies that offered partner benefits, the value of those benefits was treated as taxable income in the policyholder’s paycheck, which will no longer be the case. It’s worth noting, though, that some employers have already rolled back health-insurance and other benefits offered to domestic partners in states where it has been legal for same-sex couples to wed, requiring them to get married in order to keep those perks. With same-sex unions legal nationwide, more employers may follow suit.

Pensions and retirement accounts: Previously, same-sex couples were not eligible for survivorship benefits from pensions and other retirement plans. Now a surviving spouse can roll an inherited IRA into their own account without triggering a taxable event. Married same-sex partners can now also fund a spousal IRA for a nonworking spouse, and no longer need to worry about losing out on 401(k) benefits even if they weren’t specifically designated as the beneficiary.

Default decision making: Same-sex partners who wanted to be sure that they could make health care or financial decisions on the other’s behalf used have to complete legal paperwork granting power of attorney. Now, spouses will automatically be regarded as the default decision makers for each other.

Divorce: While we all want to think that a union won’t end, the right to marry brings with it the possibility of divorce. Previously, same-sex couples could have faced significant taxation when they divided shared property. Now, says Armstrong, in the event of a split, the division of assets such as property or an IRA account won’t be treated as a taxable event.

Read next: Same-Sex Marriage Rights Can Boost Social Security Benefits By Up to $250,000

MONEY Taxes

Corporations Dodge $200 Billion in Taxes Each Year

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Peter Dazeley—Getty Images

Developed countries lose out on $100 billion in revenue annually.

A new report from the United Nations finds that global companies are able to avoid hundreds of billions of dollars in taxes annually by moving profits offshore.

The paper, produced by the UN’s Conference on Trade and Development, suggests that strategies involving “foreign direct investment” result in lost tax revenue for developed countries like the United States—to the tune of $100 billion. Estimated losses for all developing nations are similar: Between $70 and $120 billion.

Companies are able to avoid taxes by shifting earnings away from countries with high tax rates—even if the profits were actually generated there—and moving them to nations with famously low rates.

For example, the report points out that the British Virgin Islands received more than $70 billion in foreign investment, nearly double that going to the United Kingdom—despite having an economy 3,000 times smaller.

International forums and organizations like the G20 and OECD are currently working toward an international agreement that would limit tax avoidance.

Read More: Everything You Need to Know About Companies Leaving America for Taxes

MONEY Kids and Money

5 Things New Grads Need to Hear From Their Parents (Even if They’d Rather Not)

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Getty images

Young adults say they wish they had started saving sooner.

One of the hardest things about letting a newly licensed driver leave the house in your car is this: They don’t know what they don’t know (but if you taught them to drive, you may have some ideas). They will learn, perhaps the hard way, and you won’t be there to offer warnings and commentary.

Finances are a lot like that. You’ve taught them, they’ve graduated from high school or college and now they are entering the real world — and figuring out that there are some gaps in their knowledge. Maybe their parents didn’t tell them, or maybe they weren’t listening when the parents did, but here’s what newly minted adults — asked via social media — told us they wished they had known more about money.

1. Compound Interest

They now wish they’d put baby-sitting and lawn-mowing money into retirement accounts. The young adults who responded to our question were big believers in putting away money early. They just wish they’d known sooner.

2. How to Invest

They want to know what they should be doing with the money they sock away. Some wish they had known how to invest in college. Some of them remember hearing their parents or grandparents talk about getting crushed in the market during the recession. But by now, the markets have rebounded, and they know that those who held on when the ride got scary have been rewarded.

3. How Taxes Work

Some states have income tax, and others don’t. Some municipalities tax the money you earn. Sales tax can be twice in a new state what it was in one’s home state. Who knew? And is there a way to figure out how much to take home in one’s paycheck after the deductions? They wish they understood taxes a little better.

4. Credit & Credit Score Management

“My dad always told me never to get a credit card,” said one. “My friend actually told me that I needed it to eventually get a house, new car, etc. So I’m building credit now when I could have been doing that throughout high school and college.” Others said they are learning late about precisely what it takes to build or rebuild credit. (Interestingly, no one complained that parents didn’t warn them about debt — parents are presumably doing a great job there.)

Experts suggest checking your credit scores and credit reports regularly so that when you do decide to take on debt (perhaps to buy a home or car), you can qualify for the best rates. Regularly monitoring your credit can also clue you in to possible identity theft if there is a large, unexplained change in your scores.

5. Buying vs. Renting

Whether they’re shopping for a home, car or furniture, new grads want to feel confident they’re making a good decision. Some wonder if renting to own is a good compromise.

There are a good many resources online to help with understanding all of these topics, and the millennials who described the gaps in their knowledge seem fully capable of finding them. Still, it can be confusing because some of the information is conflicting or just plain wrong. And none of it answers the question, “Mom, Dad … what do you think?”

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TIME john kasich

John Kasich Tells TIME: The Republican Party Is My Vehicle, Not My Master

GOP 2016 New Hampshire
Jim Cole—AP Gov. John Kasich, R-Ohio, speaks at the Republican Leadership Summit in Nashua, N.H. on April 18, 2015.

Yet another entrant in the presidential race tells TIME that he plans to run as his own man

Ohio Governor John Kasich turned heads in political circles earlier this month when he announced the hiring of a pair of GOP operatives with checkered histories to run his presidential campaign.

John Weaver and Fred Davis were the strategists behind former U.S. Ambassador to China Jon Huntsman’s ill-fated 2012 campaign for the presidency. Before that, they worked for Sen. John McCain. But to those who know Kasich, their hiring made perfect sense—he’s planning to run a similarly unconventional campaign for the White House. “Here’s the thing you have to realize, the Republican Party is my vehicle, and not my master,” he tells TIME.

Casting himself as a “change agent,” Kasich has overseen an economic revival in Ohio, and won re-election in the swing state by a 31% margin over a weak Democratic opponent. It was a sharp reversal from 2011—his first year in office—when Kasich’s poll numbers plummeted amid a failed effort to curtail the power of state public sector unions in an effort to control the state budget.

Kasich unsuccessfully ran for the White House in 2000, where he was edged out by another Bush’s well-funded campaign. “The issue was money-M-O-N-E-Y,” he told the New York Observer in 2001. Kasich now says he was too young that time around, pointing to support he is receiving from those who backed Bush over him in 2000.

He endorsed George W. Bush, calling him “a soul brother” for his support of compassionate conservatism, a theme at the center of Kasich’s campaigns. “I think that it’s important for the GOP, must most important for me to be able to talk about the kindness of conservatism,” Kasich says.

To that end, he defends expanding Medicaid under Obamacare, despite vigorous opposition from Republicans. “I’ve never thought anything about it. It was the right thing to do,” he says. “We’re helping the drug addicted, the working poor, the mentally ill. I didn’t see it as standing up to my party really, I just saw it as carrying out something that I thought was important for my state.”

A former investment banker, he has no regrets about his time at Lehman Brothers, but says he supports capital requirements for large banks. Kasich tells TIME he opposes increasing taxes, but that he will not sign any pledges to that effect.

TIME caught up last week with Kasich in Utah, where he was attending the E2 Summit organized by former Republican presidential nominee Mitt Romney. Here is a transcript of the interview.

TIME: You’re having fun out there.

Kasich: Most of the time, it’s fun. I get tired once in a while, and that’s not ever fun to be tired, but you know, I’m enjoying it.

TIME: You did this in 2000 running against another Bush.

Kasich: It was a different time. I was just a young man, and you know, people said, look we like you and come back another day.

TIME: But you also lamented at the time running against Bush money. You’re set to do that again against Jeb’s $100 million.

Kasich: Our goal, if I become a candidate it’s going to be because we have enough resources where we think we can at least compete in the early states. We’re not going to get anywhere close to that, but could we have enough to put gas in the plane so it could take off the ground, and that’s an assessment that we’re in the process of making.

TIME: If you had to put odds on it?

Kasich: We don’t know yet. We’re getting close. We’re going to have to decide things relatively soon. And how do I feel about it, I feel pretty good. I feel like we’re making progress.

TIME: Was this meeting helpful in that regard?

Kasich: Not yet, we’ll see. We have lots more meetings. I came here because Mitt invited me, I didn’t come to some of the other ones. I thought it was important to get out here and let people—a lot of people said we know of him, but we don’t really know him. In that regard this was helpful. I hope. I don’t know what the people were saying. I don’t know.

TIME: You talked about your approval rating taking a hit your first year as governor. What did you learn from that?

Kasich: Got crushed! The one thing that I really learned from that is, you really want to unite. And if you have to fight and you divide, that’s okay, but just don’t do it all the time. Look, we were $8 billion in a hole, we had many things we had to do to climb out of that. And once we started climbing out, we were in a better position. I’m also a change agent. And when you’re a change agent, it shakes people up. Why do you think when people hear me talk they get like, what is this guy, who is this guy. Why doesn’t he say what we expect him to say. That kind of message, it rattles people. And then peoples started to get used to me. I wouldn’t be surprised if my poll numbers went down again. That’s just the way it is. You can’t worry about it.

TIME: What’s the better metric?

Kasich: Results. Harry Truman did not run for re-election because people thought he would not win. He didn’t think he was going to win. It turns out he was one of our great presidents. It’s results. It’s not polls, and popularity. They ran Winston Churchill out of politics for a while, but look at what he ultimately did. It’s results that matter, nothing other than that.

TIME: You got your results. You left Washington. You went to Lehman. You were there during the financial collapse. What did you learn from that, in terms of how banks and financial institutions should be regulated.

Kasich: On the biggest issue, they’re already imposing capital requirements now. But one of the things you don’t want to do is treat the big boys the same way you treat the regional boys, because you then start snuffing out opportunity. When you step on the air hose and people can’t loan money, that’s like the kiss of death for business. Business has to have capital. At the same time, I think Wall Street is a necessary ingredient of the global economy, but you know, you’ve just got to keep people realizing that helping clients is the most important thing, not helping yourself.

TIME: Any regrets from that period?

Kasich: It was fantastic. Are you kidding? Regrets? I thought it was a fantastic time. I traveled all over the country. I got an incredible education. I worked my tail off. It was great.

TIME: What did you learn?

Kasich: I worked with private equity. I worked with venture capital. I worked with many different times of companies. I learned about how America works, how free enterprise works, how business executives think, how decisions get made. It’s an incalculable thing that I learned.

TIME: Last time around, candidates were asked whether they would take a 10-1 deal on spending cuts to tax increases. Would you?

Kasich: Right now, I just don’t think that revenue is what we should be talking about. I think that, look, I ran the budget committee. I was one of the architects of the balanced budget. We actually cut taxes then. I had to remain President Obama that early in my tenure as governor. I think let’s focus on changing these programs and making them more efficient. I worry about spending more money, because you know what happens, every time you put more money into the system, they spend it and they don’t do what they’re supposed to do.

TIME: Would you sign something like the Americans for Tax Reform pledge?

Kasich: I’m not signing any pledges. I’m not signing any pledges. I’m just not going to sign any pledges. My record speaks for itself.

TIME: The debt ceiling will be hit this fall. What should Republicans in Congress do?

Kasich: They should be working with their colleagues, working with the administration to put something together that’s going to get us to balance over time.

TIME: Should that be a prerequisite to raising the debt ceiling?

Kasich: I’m never going to say what should be happening regardless. I’m not going to respond to that.

TIME: What did you learn from standing up to some in your own party on Medicaid expansion?

Kasich: I’ve never thought anything about it. It was the right thing to do. We’re helping the drug addicted, the working poor, the mentally ill. I didn’t see it as standing up to my party really, I just saw it as carrying out something that I thought was important for my state. Here’s the thing you have to realize, the Republican Party is my vehicle, and not my master. My job is to try to figure out how to fix things, and I’m going to fix things as best as I can. I’m going to get a team together to fix things. And I can’t sit around and worrying what the heck the chairman of the Republican Party thinks about what I’m doing. I have to do what has to be done to bring improvement. What would I do? Say, oh well, the Republicans don’t like this therefor I shouldn’t do it. What kind of a government would that be. We’re not a parliamentary system.

TIME: In 2011 you signed an executive order banning discrimination based on sexual orientation, putting you on the forefront of states controlled by Republican governors. What did you think of the RFRA debate in Indiana and elsewhere?

Kasich: We don’t have that issue in Ohio, and I just don’t think we should discriminate against anyone, plain and simple.

TIME: That executive order did not include protections based on gender identity. Is that something you would be open to?

Kasich: I put the executive order out and it covers who it covers. And if I saw a reason to investigate something else, I’d look at it.

TIME: On foreign policy, some in your party have taken a more isolationist approach, the Rand Paul model—

Kasich: No. I don’t think America should be the policeman of the world, but we have to be engaged and we have to be a leader, and that comes from strong economic growth, a strong military, good diplomatic efforts, and integrating our business community. I just think it’s a whole new paradigm. And Gen. Jim Jones has been proposing sort of—that our military commanders, combatant commanders, work closely with our diplomatic corps, and including the business community in all this. People would say we’re already doing it. I don’t believe it. I think there needs to be more of an integration, so that we look at these issues holistically.

TIME: Soft power?

Kasich: I would say some soft, and some really tough power. Let’s think about how we can bring economic development, let’s see if people could learn a little more of the rule of law, rather than the rule of man, which is kind of what you see in China now. And business people have a a good view of what’s happening internally in countries, and they can be a positive force. And so I think there needs to be a full integration of all of that. But you have to have a strong military and it needs to be rebuilt.

TIME: You spoke about the need to reform the military. How would you go about doing that?

Kasich: The whole thing needs to be looked at. We still have systems we don’t need, we have infrastructure we don’t need. Is there a way to preposition equipment. Are there technologies that can take the place of more expensive, traditional military equipment. Can we get our allies to become more robust. It’s a whole series of things that you need to do. But the building itself—I mean, why do you have over 900,000 bureaucrats working in one way or another in all these systems. It becomes complicated. It’s a lot of stuff that needs to be done.

TIME: Are there specific programs that you have in mind?

Kasich: Well, that’s a process we’re going through right now. And I’ll have more to say about that in the future.

TIME: There are a number of military bases in Ohio, you mentioned base closures, should they be—

Kasich: I think that bases should be closed on the basis or opened on the basis of what they contribute to our national security. I went through when I was a congressmen, one of my operations shutting down. Look, I was at Pease Air Force Base, it got shut down, and they turned lemons into lemonade. The Pentagon needs precious resources to build the strength of America, and we can’t say, ‘this is really important to this community, and it’s really not vital to the national security, but we ought to do it anyway.’ So, I think we have to have a discipline on this.

TIME: What is the greatest impediment for you, as you potentially go down this road? Money? Name-ID? Convincing voters you have the right vision?

Kasich: I don’t really see — I’m pretty optimistic about what I’m seeing. I know that the world would shudder, if I were able to clone me, but it would be great if there were more of me to go around so you could get to more places to talk to more people. I would say, I don’t kind of look at life that way. I’m not looking at impediments right now. I just look at opportunities. As Arnold Schwarzenegger told me one time, “Love the beatings.” [in accent] As Arnold told me one time, “Going down the slope, love the moguls.” I think that’s right, that’s a good attitude about life, and it’s a good attitude about politics.

TIME: You have something of a reputation for having some rough edges. Do you see that in yourself sometimes?

Kasich: I’m from Pittsburgh, we’re pretty direct from outside of Pittsburgh.

TIME: That’s like the Chris Christie response.

Kasich: I don’t know about that. But look, we build teams of people and we’ve had really great results. And we’re just going to build good teams o people. One of the great, most heartening things was, being in New Hampshire many years ago, many of the people that I touched back then are with me today. They want to help. Isn’t that a great thing?

TIME: John Sununu being one of them.

Kasich: John, but Bruce Burke, and there’s a host of them. There are people who said, hey, if he’s doing it again, I want to be involved, and that’s really, really cool.

MONEY Taxes

How Much Tax Money Should Come Out of My Paycheck?

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Getty Images

The IRS requires that your total withholding tax for the current year be equal or greater than your total tax liability for the prior year

Q. I’m changing jobs and I’m not sure the best way to decide how much I should have withheld in taxes. My husband does side contract work and he doesn’t pay estimated taxes, so at my job now, I have them take out more each week to cover his taxes too so we don’t get slammed at the end of the year. Advice?

A. Figuring out — ahead of time — what taxes will be due can be a challenge. But you can make smart guesses to ease the process come April 15.

For starters, taxes can be tough to estimate because the withholding tax schedules do not take into consideration itemized deductions, said Howard Hook, a certified financial planner and certified public accountant with EKS Associates in Princeton, N.J. They also don’t adequately account for two high-income earners where the lower tax brackets have already been filled with the first spouse’s income, he said.

“The fact that your husband does not pay estimated taxes on his side work does make things more difficult,” Hook said.

That said, the answer to your question depends largely upon the amount of income you and your husband are currently earning, said Steve Gallo, a certified public accountant with U.S. Financial Services in Fairfield, N.J.

“Without knowing what your joint tax bracket is and how much of this is attributed to your husband’s side work, giving you accurate advice would be difficult,” Gallo said.

Gallo said if your husband’s side work is a small part of your overall income, you would most likely be able to cover his taxes through your increased withholding. However, if his income is significant, covering both the income tax and his self-employment tax could prove troublesome, he said.

In order to avoid underpayment penalties, in the event you have a balance due, the IRS requires that your total withholding tax for the current year be equal or greater than your total tax liability for the prior year, Gallo said. If you meet this requirement and you still owe taxes there will be no penalties assessed.

Hook said the best way to figure out how much to withhold is to do a tax projection based on how much taxable income you think you will have in 2015.

“If you use an accountant to prepare your taxes, you should ask him or her to prepare a tax projection so that you can see how much you need to withhold,” Hook said. “If you do not use an accountant to prepare your taxes, it is more difficult to do and it probably makes sense to hire an accountant to prepare your taxes in the future.”

He said the accountant will not only help you with the tax projection, the accountant also may be able to help you find additional deductions you may not have thought of on your own.

Read next: How to Get a Double Dose of Tax-Deferred Savings

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MONEY Social Security

Are Social Security Benefits Taxable?

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Rubberball/Mike Kemp—Getty Images/Rubberball

Your marital status, total income and location all come into play.

Saving for retirement is a crucial part of preparing for your financial future — but that doesn’t mean you shouldn’t plan for Social Security benefits. You can calculate what your Social Security income will be to help provide an estimate of your benefits and what other savings you will need to lead the lifestyle you want in retirement. While you may have heard about a time when these payouts were tax-free, that is no longer the case. In short, Social Security benefits are taxable. But in reality, it is not that simple — taxability depends on marital status, total income and location. If you have some additional retirement income, besides Social Security, coming from a salary, pension, IRA or 401(k), you will likely be over the income limits and can expect that up to 85% of your Social Security benefits will be taxable.

Income Limits

The portion of your benefits you are taxed on depends upon your income. The Internal Revenue Service sets limits for calculating tax liability every year. In 2015, you will pay income taxes on up to 50% of your benefits if you are filing as an individual with combined income between $25,000 and $34,000. If you have more than $34,000 in combined income, you could be subject to taxes on up to 85% of your benefits. For couples, the amounts are $32,000 and $44,000 for up to 50% and about $44,000 for up to 85%. In this case, “combined income” means the total of your adjusted gross income, the nontaxable interest and half of your Social Security benefits. If Social Security benefits are your only source of income and your total is below $25,000, your benefits will not be taxed at all — but you may not have the comfortable retirement you imagined.

Federal & State Taxes

If you will have to pay taxes on your benefits, up to 85% every dollar of income you make over the limit will be subject to federal income tax. This can get complicated to predict, so the IRS offers a worksheet and e-file software to help you calculate your Social Security tax liability. It’s a good idea to check with your local tax pro or an accountant about state and local taxes because the rules vary by location. Some states offer exemptions and credits based on age or income and at least some Social Security is tax-exempt in most states, but there is usually a range.

Simplifying the Process

You can make the tax burden on your Social Security benefits simpler by paying these costs gradually throughout the year instead of all at once. You can either ask the Social Security Administration to withhold taxes from your benefit check by submitting a W-4V or pay quarterly estimates. If you are very concerned about tax burden in retirement, it’s a good idea to start saving early and generously with a Roth IRA, as this account uses after-tax dollars. You will never have to take required minimum distributions and you will not have to pay taxes on payments down the road because you already have.

Retirement can be tricky, so it’s important to stay on top of your finances and look for ways to improve your Social Security benefits. Check regularly to ensure you are saving enough for retirement in other ways like a 401(k) or IRA to supplement the money you can expect from Social Security. While paying taxes may not be enjoyable, this is an indication that you have saved sufficiently and will not have to live solely on these Social Security payments.

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MONEY

6 Signs Your Finances Are in Great Health

stethoscope on $100 bill
Yuji Sakai—Getty Images

Rock your finances.

You have six months of take-home pay socked away in an emergency fund. You pride yourself on your 720 credit score. And you contribute enough to your company 401(k) to get a match.

If this sounds like you, then you deserve a big pat on the back—you’re well on the road to optimal financial health.

But what are the signs that you’re really rocking your finances—that you’re not just an “A” student, but picking up extra-credit points along the way?

To help you see if you’ve entered overachiever territory, we’ve rounded up six benchmarks that show you’re kicking your finances into high gear.

And even if you can’t tick off everything on this list, consider them aspirational new goals to work toward, so you can take your money game to the next level.

Telltale Sign #1: You’re a two-income household—but you can live off just one.

For couples who bring in two salaries, it can be tough to resist the temptation of lifestyle inflation—which makes it all the more impressive when you can comfortably live off one income and devote the other to long-term goals, like retirement or a college fund.

“It’s a good objective, although it’s fairly rare that people can do it,” says Kevin O’Reilly, a Certified Financial Planner and principal at Foothills Financial Planning. “It’s not unusual to see people with two incomes who can’t save anything.”

So if you’re part of a duo who’s resisted trading up your lives with every raise or bonus, consider yourself masters of living well within your means.

“[Living on one income] is a great discipline—and it provides a lot of financial help if one spouse loses a job down the road,” says Jean Keener, a CFP and principal of Keener Financial Planning.

If you’re not quite there, comb through your expenses to see which category of costs is eating into your budget the most, and use that as a starting point for paring back.

“If a significant portion of [your budget] is discretionary, it may be easy to cut back travel, make fewer trips to a restaurant, or buy clothes less frequently,” Keener says. “However, if [your budget] is going mostly to fixed spending, looking at larger items will lead to longer-term success. Making one big decision, like downsizing your house, [will be] generally easier than making small decisions about cups of coffee and Girl Scout cookies.”

Telltale Sign #2: Your net worth exceeds your annual income—and keeps growing.

Net worth is one of the most important barometers of financial health because it looks at your whole money life: your total assets (like the cash in your checking account, the current value of your home and your investments) minus your liabilities (such as student loans, credit card debt and what’s left on your mortgage).

While having a positive net worth is great, having a net worth that exceeds what you earn is excellent because it shows you’ve been diligent about building wealth, living within your means and paying down debt simultaneously—goals you don’t have to be in the wealthiest 1% to achieve.

There’s no hard and fast rule for how much your net worth should be. But for something aspirational, O’Reilly likes this equation from Thomas J. Stanley, author of “The Millionaire Next Door”: 10% times your age times your income. So if, say, you’re 40 and make $100,000, your target net worth would be $400,000.

But don’t let that number intimidate you—what’s really important is that you show an upward trend.

“Is your net worth growing? That’s a good sign that debt is going down and savings are going up,” Keener says. “Maybe you don’t think you have enough yet, but you’re headed in the right direction.”

Just make sure that you’re not relying on just one asset to get into the black. Otherwise, you may not be addressing all of your long-term savings goals.

For example, “[Your] half-million-dollar house is not necessarily something you’re going to use to fund your retirement,” says Cheryl Krueger, a CFP and founder of Growing Fortunes Financial Partners LLC. A healthy retirement plan covers a comprehensive mix of assets.

Telltale Sign #3: You can name what’s in your investment portfolio.

If you’ve been steadily stowing away 10% of your income into your 401(k), congratulations! Now, quick: What’s your asset allocation?

If you can answer that without reaching for old brokerage statements, you’re ahead of the game. “I have people who come in and say they’re good savers, but they haven’t touched their 401(k) allocation in 10 years,” O’Reilly says. “That’s a bad sign.”

Unfortunately, investing with blinders on isn’t altogether uncommon: One 2014 MoneyRates.com survey found that one in five people don’t know what goals they’re investing for—and about 12% don’t know which primary asset class their money is in.

So how can you go from clueless to someone who can answer the asset allocation question in five seconds flat?

For starters, keep tabs on where your accounts are housed, and don’t look at them as separate entities. Your portfolio as a whole should be reviewed to see if it’s meeting your investment objectives, whether that’s growth (taking on more risk) or preservation (taking on less risk to protect your principal).

“In a couple, typically one spouse knows more about the finances than the other, so they defer to the other person [on knowing where the money is],” Krueger says. “Or with single people, you see a lot who’ve changed jobs and don’t [even] know where their 401(k) is. It helps to be able to look at things all together.”

Once you’ve nailed down your total investment picture, figure out the frequency with which you’ll check on those investments—keeping in mind that you may have to tune out market noise. “You don’t have to look at the Dow every day, but you should be checking your portfolio every quarter or so,” suggests Keener.

Telltale Sign #4: You neither owe nor get a refund at tax time.

If you got to the bottom of form 1040 this year and netted close to zero, then you (or your accountant) did an excellent job of managing your tax liability.

“Penalties are a waste of money, and an unexpected tax bill can cause someone to invade their emergency fund or [resort to] high-interest credit cards to help pay the bill,” Keener says. “It’s also beneficial not to get a huge refund because you could be earning interest on that money over the course of the year, rather than giving an interest-free loan to the I.R.S.”

If you consistently owe or get a refund of more than $1,000, consider adjusting your withholding, so more or fewer taxes are taken out of your paycheck during the year.

Using your most recent W2, fill out the I.R.S.’ withholding calculator to estimate what your number should be—and remember to take note of any life changes that could affect your tax situation, such as getting married, having a child or changing jobs midway through the year.

Telltale Sign #5: Less than a third of your income goes toward debt.

Your debt-to-income ratio (DTI)—minimum monthly debt and mortgage payments divided by your gross monthly income—helps tell lenders how well you’re managing debt.

Although every lender varies, the oft-quoted benchmark for an acceptable DTI is 36%. Krueger, however, believes that percentage is still fairly high.

“I would say 10% or less of your gross income going to debt is a good indicator [of strong financial health]—and, of course, you want it eventually to go down to zero,” she says.

Krueger believes that aiming for less than the lending benchmark is prudent, because “between taxes and saving for retirement, having debt [take up] 36% of your income doesn’t leave much money for [other] savings.”

If you need to chip away at debt to improve your DTI, consider the “avalanche method,” which involves prioritizing paying down your highest-interest debts first, while still meeting the minimum payments on others.

Then, once you’re done paying off that first debt, you can apply that payment to your next highest-interest loan or credit card.

Telltale Sign #6: You’re done with car payments.

Being free and clear of auto financing is a double-whammy positive indicator. Not only have you eliminated debt—and likely improved your DTI—but “it means you’re driving your cars longer, and getting more value out of them,” O’Reilly says.

But living car-debt-free is something few Americans seem to be able to accomplish: At the end of 2014, the country’s automotive loan balances reached a record $886 billion, according to Experian Automotive.

Of course, this doesn’t mean you should sink a hefty lump sum into your car loan just to be rid of it.

“[Not having a car payment] is a positive indicator [of financial health], but with interest rates so low right now, having a car loan isn’t necessarily a bad thing,” Keener says. You could, for instance, consider using that money instead to beef up an emergency fund, pay off higher-interest debt or invest in something with better returns.

In other words, what having no car payment really signals is that you’re getting as much bang for your auto buck by driving your car until it dies—which can yield a significant savings, considering the average auto loan now surpasses $28,000.

So before you trade up for the latest model, consider whether you really need that rich Corinthian leather, or whether the money could be better served for retirement—or a new-car savings account, so you can pay cash for your next ride.

“Financially, you’re much better off if you continue driving the car as long as possible and view it as a depreciating asset that’s just transportation from point A to point B,” Keener says. “As long as it’s reliable and safe, it doesn’t need to be replaced.”

LearnVest Planning Services is a registered investment adviser and subsidiary of LearnVest, Inc., that provides financial plans for its clients. Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice. Please consult a financial adviser, attorney or tax specialist for advice specific to your financial situation. Unless specifically identified as such, the individuals interviewed or quoted in this piece are neither clients, employees nor affiliates of LearnVest Planning Services, and the views expressed are their own. LearnVest Planning Services and any third parties listed, linked to or otherwise appearing in this message are separate and unaffiliated and are not responsible for each other’s products, services or policies.

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