When to File Taxes- Wesley Snipes Takes Hard Way

An article posted this morning on cnn.com states that Wesley Snipes has tried to cheat the government out of $12 million dollars for falsely filed tax claims. It was also found that Snipes failed to file between 1999 and 2004. A warrant has been issued although his whereabouts are currently unknown. Snipes may face a maximum of 16 years in prison for tax fraud.
Filing a false claim or failing to file at all if required will quickly get you into hot water with the IRS. Flags are raised with obvious situations like reporting zero for your adjusted gross income or having earned income and not reporting it at all. So when are you required to file? Let's take a look. Publication 501 from the irs.gov website explains situations when you must file. The following is an excerpt from this publication.
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Who Must File- If you are a U.S. citizen or resident, whether you must file a federal income tax return depends upon your gross income, your filing status, your age, and whether you are a dependent. For details, see Table 1 and Table 2. You also must file if one of the situations described in Table 3 applies. The filing requirements apply even if you owe no tax.
You may have to pay a penalty if you are required to file a return but fail to. If you willfully fail to file a return, you may be subject to criminal prosecution.
Filing Requirements for Most Taxpayers- You must file a return if your gross income for the year was at least the amount shown on the appropriate line in Table 1. Dependents should see Table 2 instead.
Deceased Persons You must file an income tax return for a decedent (a person who died) if both of the following are true.
You are the surviving spouse, executor, administrator, or legal representative.
The decedent met the filing requirements described in this publication at the time of his or her death.
For more information, see Final Return for Decedent in Publication 559.
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With less than 3 months left in the calendar year, it's not too early to start thinking about year end tax savings and whether or not you need to file. In any case, don't try to work over the system because it will be sure to catch up with you sooner or later. Was it worth it Mr. Snipes?

The Rule of 72

The Rule of 72
One of the simplest rules of investing, yet commonly forgotten, is the Rule of 72. By using this rule you can either determine how long for a single sum to double in value or determine the interest rate required for an investment to double within a specific number of years.

To calculate the number of years required for an investment to double in value, divide 72 by the annual interest rate. For example, if the objective is to double a $1,000 investment to $2,000 where the original investment is earning an annual compound rate of 9%, it will take approximately 8 years for this to occur (72/9=8).

To calculate the interest rate required for an investment to double in value, divide 72 by the number of years. If, for example, an investor wants to double his original investment in 10 years, it will require an approximate annual interest rate of 7.2 percent (72/10=7.2).