Trans World Assurance Blog

How Your Taxes Change After Marriage

Posted on Mon, Aug 06, 2012

Once you get married, you can choose to file jointly or separately. For many married couples, filing jointly has a significant positive impact on their finances. Some couples choose to get married sooner rather than later to take advantage of tax breaks. A few are better off filing separately. Depending on your situation, getting married can help you pay less in taxes in the long run and should be discussed with a tax professional.

Filing jointly when one spouse makes significantly more money than the other can be a huge advantage. When filing jointly, the standard deduction doubles. If the standard deduction is $5,000 for an individual taxpayer, the standard deduction is $10,000 for married filing jointly. If one spouse earned $50,000 for the year and the other earned $2,000 for the year, it's almost as if each spouse is earning $26,000. A $10,000 deduction is taken out despite the fact that one spouse earns more money.  If they filed separately, most of the standard deduction for the spouse who earned $2,000 wouldn't be used.

There is a possibility of a marriage penalty depending on your income situation. Due to the doubling of the standard deduction and adjustments in the tax brackets, most couples don't have to worry about this. These adjustments were enacted to minimize such penalties. However, those who have much higher income are pushed into higher tax brackets that haven't been adjusted completely for two people. These couples may end up paying more in taxes filing jointly than if they filed separately.

Married couples save tax money on more than just income tax. If you're selling your home, as a married couple you will get a double tax break. If the married couple has lived in their home for at least 2 of the last 5 years of ownership, $500,000 of profit can be excluded from taxes whereas only $250,000 can be excluded for single individuals. For those who don't have homes with a large profit margin, this is negligible, but couples who are selling for a large profit can save a significant amount on taxes if they file jointly.

Some people get married looking forward to the tax benefits. Most married couples will benefit from filing jointly due to the many tax breaks available when filing jointly. The best way to pay the least amount in taxes possible is to analyze your situation thoroughly. How much would you pay if you filed jointly and how would you pay if you filed separately? Most likely, filing jointly is the best way to go, but if you're concerned because both you and your spouse have substantially high incomes, experimenting with both ways is a smart decision. As always, your personal tax situation should be discussed with a tax professional.

If you are a military member, according to the IRS, military members and their spouses may be eligible to receive free tax return preparation assistance. The IRS and U.S. Armed Forces participate in the Volunteer Income Tax Assistance program which provides free tax advice, tax preparation, return filing and other tax assistance to military members and their families.

"Military Personnel and their Families Get Free Tax Help!" page on the IRS website.


The information in this article is intended for educational purposes only. This information should not be considered tax or legal advice. Individual circumstances vary. Please seek the advice of your accountant, tax professional, and/or legal advisor for answers to specific questions and to review your individual circumstances.


Tags: military, personal finance, money saving tips, military spouse

A Guide for Shipping to APO and FPO Addresses

Posted on Fri, Mar 16, 2012

A common problem for military stationed overseas, and their dependents, is their ability to shop online with ease. There are still many online merchants who will not sell to military using APO/FPO addresses, even though they offer shipping options using USPS (United States Post Office), which is the way in which those who are military and living overseas receive their package deliveries.

More often than not, the difficulty results from the merchant not understanding how to ship to APO or FPO addresses, and it is to easy for them to just not ship to those addresses rather than become informed of what is involved. The reasoning for why many of these merchants will not ship to APO or FPO addresses is because they think these addresses are international addresses, and this is just not so. APO (Army/Air Force Post Office) and FPO (Fleet Post Office or Federal Post Office) are not international addresses, but are considered United States addresses.

Even though there are so many military friendly merchants out there, there are still many more who do not ship to them only because they do not understand that they are not international addresses; other merchants have other reasons like it being inconvenient. There is definitely a need for a guide to shipping APO/FPO, and it is the hope that by putting together a brief guide others, especially merchants, will have a new and better understanding for the process.

• APO/FPO addresses are not international addresses.
There is an assumption, that because we reside in a foreign country, our mail goes through an international postal carrier. This is not so. Our mail goes through USPS Priority Mail. If USPS surface mail is chosen, a package will take up to eight weeks to arrive, sometimes longer. Of course, this limits us when it comes to businesses that use only Federal Express or UPS; however, maybe in the near future, if negotiations go that way, this too may be an option. Mail sent to APO/FPO addresses will go either to California, New York, or Florida before it is transported to the overseas military installations.

• APO/FPO addresses have a state.
These addresses use the following state abbreviations: AE (Armed Forces Europe), AA (Armed Forces Americas), and AP (Armed Forces Pacific).

• Customs Paperwork:
Yes, when shipping a package to an APO or FPO address, the shipper will be required to fill out a customs form. This can be obtained at your post office or online at the USPS website, where you can download and print the customs forms.

• General Restrictions:
APO/FPO addresses do have restrictions against certain items being sent and shipped to these addresses.

1. A package shipped to APO/FPO should not exceed 70 pounds.

2. They may not exceed 130 inches when length and girth is combined.

3. The Post Office does require that packages be hand delivered to the Post Office by the company or person who is shipping item to the APO/FPO address.

4. Restricted items: perishable food, tobacco, alcohol, firearms, privately owned weapons, pornography, illegal substances, and hazardous items. Check with your post office for any other restricted items specific to the APO/FPO zip code you are shipping to. 

It is really not that complicated, and the efforts made to accommodate those military, which are so far from home, really is appreciated. There is an understanding and respect for companies' decisions not to ship, but not when they will not because they think these addresses utilize international postal services - they do not. Hopefully, in the near future, Federal Express, and UPS will finalize an agreement and ship to service members and their families residing overseas; but, even when that day arrives, there will still be those merchants that think they are international addresses.

Not only are there problems with some merchants not shipping to APO/FPO addresses, but also there are many who make it hard for military stationed overseas to do business with them. For example, when one decides to make a purchase online for a gift for someone back home in the states, they finalize their choice and head to the check out. When it comes time to enter billing information, they are brought to a halt; and more often than not, have to forget about making their purchase through that merchant. What happens is they can enter city as APO or FPO, but they do not give the choice for AE, AA, or AP in the states menu. You can attempt to use NY, CA, or FL, however, when putting in the zip and proceeding, it sometimes does not recognize the zip as valid or they may receive an email that their credit card was declined for invalid address. It can be rather frustrating. When emailing the merchants about this, the same old reply is made, they do not accept orders from international customers, and they do not care that you possess non-international credit cards and debit cards. A simple fix would be to add AE, AA, and AP to the state menu, this way even if merchant does not wish to ship to APO or FPO, at least those overseas can still make purchases that will be sent within the states.

Written by Jan Castagnaro



Tags: military, purchases

5 Must Read Articles About Military Members and Life Insurance

Posted on Tue, Feb 14, 2012

1) It pays to have enough life insurance: Policies beyond SGLI can spell financial security

"Having the money from an extra life insurance policy above and beyond Servicemembers’ Group Life Insurance gave Vivianne Wersel extra options after her Marine husband died in early 2005…" - By Karen Jowers


2) Servicemembers' Group Life Insurance (SGLI):

"What is SGLI?…How Much Coverage is Available?…How Much Does SGLI Cost?…How Much Life Insurance Do I Really Need?…SGLI Conversion Feature...The SGLI Disability Extension..." - U.S. Dept. of Veterans Affairs


3) Beyond SGLI:

"Servicemembers Group Life Insurance (SGLI) is part of a servicemember's employee benefit package. But it has limitations and like any group life insurance plan, it should not be relied upon to be the sole financial protection for your family…" - By Mike McHugh


4) Do Servicemembers Need Life Insurance?

"Life insurance is one of the most important components of your personal financial plan. Unfortunately, life insurance is poorly understood, and breadwinners' mistakes invariably cause great financial hardship for their survivors. The primary purpose of life insurance is to protect your survivors from the adverse financial consequences of your premature death..."

5) Assessing Your Life Insurance Needs and Options

"Assessing your life insurance needs and options can give anyone a headache! With the wide range of insurance products available and the complexity of your family's needs, determining the appropriate insurance protection is difficult.

In order to make this task easier, VA's Life Insurance Program has provided you with some decision-making tools and helpful information that can assist you in learning more about life insurance and in identifying your insurance needs…" - U.S. Dept. of Veterans Affairs

This list of articles is for educational purposes only. Trans World Assurance is in no way endorsed by any of the above websites, organizations, or authors. 

Tags: military life insurance, military, life insurance needs assessment, military spouses, Servicemember's Group Life Insurance (SGLI)

Security Clearance Debt Concerns & Solutions (Part 3) by Jeff Burch

Posted on Mon, Dec 26, 2011

Previous Article - Part 2

Part 3. Solutions and assistance that can mitigate financial concerns:

Conscientious participation in credit counseling or a debt consolidation program can significantly mitigate financial concerns. Consistent, systematic, documented good faith efforts to repay or otherwise resolve debts without formal counseling will have the same effect. If it is obvious that the subject is only taking such actions to get or retain a security clearance, it will do little to convince Central Adjudication Facilities (CAF) that the problem is unlikely to recur once the clearance is granted. Therefore, efforts to resolve financial problems should begin as soon as possible. Obviously, the earlier corrective action is taken, the more likely the problem can be fully mitigated.

For further assistance, contact a reputable nonprofit 501(c)(3) Credit Counseling Agency (CCA) that has extensive experience assisting soldiers in protecting or saving their security clearance. In most cases, they can negotiate a debt repayment plan with your collectors and put these accounts on a Debt Management Plan (DMP) to be paid off as quickly as your budget allows. A CCA can provide you with a detailed report that lists all your consolidated accounts, contact information, payment amounts, and projected pay off dates. This minimizes financial risk associated with your career and aids in the acceptance of your security clearance.

Security Clearance Debt Concerns & Solutions was written by Jeff Burch. Be sure to check out the other articles on the Trans World Assurance blog written by Jeff Burch.

Tags: military, Money Book, Jeff Burch, establish credit, Security Clearance, debt

Security Clearance Debt Concerns & Solutions (Part 2) By Jeff Burch

Posted on Sat, Dec 24, 2011

Previous Article - Part 1

Part 2. What "patterns" adjudicators look for in a Personal Security Investigation (PSI):

Adjudicators follow the "whole-person" concept and look for "patterns" of irresponsibility in a PSI. A bankruptcy or foreclosure can be considered a non-issue if the financial crisis stemmed largely from circumstances beyond the subject's control and is unlikely to recur or the subject acted in a reasonable and responsible manner.

Example: If a subject has never had financial problems in the past, but got into trouble with a lender because his/her home is currently worth less than the mortgage loan due to a market downturn, and then (gulp) received PCS orders, this would tend to be considered a mitigating condition. However, if a subject going through foreclosure has a prior history of not meeting financial obligations documented in previous investigations, this suggests a pattern of financial irresponsibility that cannot be easily brushed aside. Likewise, a soldier who obtained a loan by overstating income or committed other types of loan fraud may find it difficult to convince the adjudicators that he/she was just an innocent victim of circumstances beyond their control.

 Adjudicators understand that financial problems often arise due to situations beyond the investigation subject's control, such as serious illness/disability, divorce, loss of income, crime, business downturn, and natural disasters. Again, if a person acts reasonably and responsibly under the circumstances (including bankruptcy, when necessary) to resolve their debts, the financial issue can be mitigated. The debts do not have to be fully resolved at the time of adjudication, but there should be "verifiable uninterrupted efforts" toward this goal. Response to debt is evaluated by the things people do (or don't do) about delinquent debt. How people deal with delinquent debt is often a decisive consideration, because it is viewed by adjudicators as an indication of their trustworthiness and reliability. Those who disregard their financial obligations may also disregard their responsibility to safeguard classified information. The following is a list of common indicators of irresponsibility and unethical behavior:

• Changing address without notifying creditors
• Failure to take reasonable measures to pay or reduce debts
• Knowingly issuing bad checks
• Increased credit card use immediately before filing for bankruptcy


Security Clearance Debt Concerns & Solutions by Jeff Burch will continue tomorrow on the Trans World Assurance Blog with Part 3 - Solutions and assistance that can mitigate financial concerns.

Tags: military, Money Book, Jeff Burch, establish credit, Security Clearance, debt

Security Clearance Debt Concerns & Solutions (Part 1) By Jeff Burch

Posted on Fri, Dec 23, 2011

Previous Article - Introduction

Part 1. Concerns and issues that can occur if you're not proactive with your security clearance:

A. Financial concerns: 

Failure or inability to live within one’s means, satisfy debts, and meet financial obligations may indicate poor self-control, lack of judgment, or unwillingness to abide by rules and regulations, all of which can raise questions about an individual’s reliability, trustworthiness and ability to protect classified information. An individual who is financially overextended is at risk of engaging in illegal acts to generate funds. Compulsive gambling is a concern as it may lead to financial crimes including espionage. Affluence that cannot be explained by known sources of income is also a security concern. It may indicate proceeds from financially profitable criminal acts.
B. Conditions that raise security concerns and may lead to disqualification:

• Inability or unwillingness to satisfy debts
• Indebtedness caused by frivolous or irresponsible spending and the absence of any evidence of
willingness or intent to pay the debt or establish a realistic plan to pay the debt  
• A history of not meeting financial obligations
• Deceptive or illegal financial practices such as embezzlement, employee theft, check fraud, income tax evasion, expense account fraud, filing deceptive loan statements, and other intentional financial breaches of trust
• Consistent spending beyond one’s means, which may be indicated by excessive indebtedness, significant negative cash flow, high debt-to-income ratio, and/or other financial analysis
• Financial problems that are linked to drug abuse, alcoholism, gambling problems, or other issues of security concern
• Failure to file annual Federal, state, or local income tax returns as required or the fraudulent filing of the same
• Unexplained affluence, as shown by a lifestyle or standard of living, increase in net worth, or money transfers that cannot be explained by subject's known legal sources of income
• Compulsive or addictive gambling as indicated by an unsuccessful attempt to stop gambling, concealment of losses, borrowing money to fund gambling or pay gambling debts, family conflict or other problems caused by gambling

C. Conditions that could mitigate security concerns:

• The behavior happened so long ago, was so infrequent, or occurred under such circumstances that it is unlikely to recur and does not cast doubt on the individual’s current reliability, trustworthiness, or good judgment
• The conditions that resulted in the financial problem were largely beyond the person's control (e.g., loss of employment, a business downturn, unexpected medical emergency, or a death, divorce or separation), and the individual acted responsibly under the circumstances
• The person has received or is receiving counseling for the problem and/or there are clear indications that the problem is being resolved or is under control
• The individual initiated a good-faith effort to repay overdue creditors or otherwise resolve debts
• The individual has a reasonable basis to dispute the legitimacy of the past-due debt which is the cause of the problem and provides documented proof to substantiate the basis of the dispute or provides evidence of actions taken to resolve the issue
• The affluence resulted from a legal source of income


Security Clearance Debt Concerns & Solutions by Jeff Burch will continue tomorrow on the Trans World Assurance Blog with Part 2 - What "patterns" adjudicators look for in a Personal Security Investigation (PSI).

Tags: military, Money Book, Jeff Burch, establish credit, Security Clearance, debt

Security Clearance Debt Concerns & Solutions (Intro) by Jeff Burch

Posted on Thu, Dec 22, 2011


A security clearance is a status granted to individuals allowing them access to classified information, i.e., state secrets, or to restricted areas after completion of a thorough background check. Additionally, a security clearance can be a lucrative commodity to retain after service separation for future employment opportunities.

To apply for Military Security Clearance one must fill out and complete Standard Form 86 (www.opm. gov/Forms/pdf_fill/SF86_July2008.pdf).

Included in the SF 86 questionnaire is Section 26 that concerns your financial records within the last 7 years, and asks for full disclosure of all financial obligations, including those in which you are a cosigner or guarantor. Questions asked pertain to bankruptcy, repossessions, liens, unpaid judgments, wages garnished, 90/180 days current or past due/delinquent accounts, etc. Dire consequences may come about if discrepancies arise.

Example: A soldier marks "no" to all Section 26 questions, assuming he had paid all his bills on time, never been late, etc. But 3 years prior when splitting a townhouse rental with 3 other people, the cable was in his name. When he moved out, he told the roommates to return the cable box. They never did and the cable company marked him down for an unpaid return 3 years ago. Fast forward 5 years and the US Government pulls his credit and sees the discrepancy. The soldier has lied (unknowingly) on his SF 86 and they discharge him from service.


Security Clearance Debt Concerns & Solutions by Jeff Burch will continue tomorrow on the Trans World Assurance Blog with Part 1 - Concerns and issues that can occur if you're not proactive with your security clearance.

Tags: military, Money Book, Jeff Burch, establish credit, Security Clearance, debt, credit history

Can Your Marriage Survive Military Retirement?

Posted on Mon, Dec 05, 2011

Trans World Assurance Military RetirementMilitary couples go through a lot of challenges and experiences that civilian couples do not often have to face, such as periods of separation due to deployments, training exercises or temporary duty. There are a number of other unique issues that many couples have to face that can tear them apart such as combat-related injuries and psychological issues that they are left with when they return home. If you are coming up to military retirement, you and your spouse may both be breathing a sigh of relief. Finally, you have made it! Or have you? How can your marriage survive military retirement?

Choosing Where to Live
After spending 20 years or more being told where to move to by the military, making up your own minds about where to settle can be a challenge. The military will pay for one last move for you, so make sure you are both in agreement as to where you will go. Take your time to decide what would be best for you as a couple and as a family. Making quick or hasty decisions can lead to further stress later on.

The Military Retirement Ceremony
The retirement ceremony is a traditional way to mark a person's transition from active duty to civilian life, but it is not a legal requirement. Some choose to slip away quietly with a small family gathering to celebrate their new status, rather than involve their former work colleagues. Speak to your spouse about your expectations, plans and how you feel about having a retirement ceremony. If you want a retirement ceremony, that can be arranged and adapted in accordance with your personal wishes.

Open Communication
Open communication is the glue that keeps spouses together. Keep the lines of communication open as you embark on your next journey together as a couple. Do not let the stresses and strains of out-processing, moving house, adjusting to a reduction in pay and other issues stop you from communicating openly and honestly with your spouse about your fears and concerns for the present, and for what the future holds.

It is perfectly normal to be afraid of what the future may hold, especially when you have spent your whole adult life being closely supervised and instructed on how to act and conduct yourself. Now you are on your own to decide all that for yourself. But for married military retirees, they are not really on their own. They should lean on their spouses even more so than ever before to help them with their transition. Doing so will keep a couple strong.

Military retirees need to maintain stronger marriages with their spouses now than ever before, as transitioning can be very challenging and stressful. Your marriage can survive military retirement if you are supportive of each other during this time of change and transition. Lean on each other for support, communicate openly and you will find that your marriage will continue to go from strength to strength.

Written by, Sophie S

Sophie S is a freelance writer from the UK residing in California. She holds a BA (Hons) in English with Sociology. She works as a freelance writer, specializing in web content on immigration, expatriate life, cat care and much more. Sophie has had over 3,500 articles published on the Yahoo! Contributor Network, other sites and for private clients.

Tags: military, retirement, military spouse

Every Military Member Should Assess Their Life Insurance Needs

Posted on Mon, Sep 26, 2011

When members join the military, they are automatically enrolled in the Servicemen's Group Life Insurance (SGLI) for the maximum amount of coverage and premiums are automatically deducted from their military pay. It is not uncommon for servicemembers to be told that all they need is SGLI, when frequently that would be poor advice. Servicemembers deserve the right to make responsible choices and decisions that their civilian counterparts make.

Every insurance decision should be made only after a thorough budget review, as well as a life insurance needs assessment. The Department of Veterans affairs provides a Life Insurance Needs Calculator on-line. This calculator helps military members to determine the amount of life insurance coverage needed.

To determine the amount of life insurance needed, the calculator takes into account current financial obligations, existing assets, and the income that would be needed to support a surviving family. It also takes into account how long the family needs to be sustained. The calculator is intended as a guide in the process and does not replace the services of a financial or insurance specialist who can fine tune your individual circumstances.

transworldassuranceTop 5 reasons military members should consider purchasing permanent cash value life insurance while still in the service

1) Servicemembers Group Life Insurance (SGLI) is not a permanent insurance solution. SGLI terminates 120 days after leaving the service. Many service members, in leaving the military, do not convert to Veterans Group Life Insurance (VGLI) because it can be very expensive and increases in cost over time. For more information, read the article "Beyond SGLI" at written by Captain Mike McHugh.

2) When purchased at a young age, permanent cash value life insurance premiums will remain low and fixed, and the return on many cash value products is outstanding in comparison to other financial choices.

3) The cash values accumulated from a permanent cash value life insurance policy can be used in helping the transition from military to civilian life.

4) Cash value life insurance provides death protection that will be there for a family if necessary.

5) Disability incurred during service could make purchasing standard insurance at normal rates impossible after leaving the service.

Tags: Trans World Assurance, military life insurance, military, life insurance needs assessment

Where Should You Move to Following Military Retirement?

Posted on Fri, Sep 09, 2011

transworldassuranceMilitary retirees have the freedom to move just about anywhere they would like, which can come as quite a shock after 20 or more years of being told where to move to. Many military retirees have a clear idea of where to move to long before they have retired from the military, whereas others need extra time and resources to work where to relocate to where their future needs will be taken care of. How can you decide where to move to as a military retiree? 

States that Do Not Tax Retired Military Pay
If your biggest concern is holding onto as much of your retired military pay as possible, then you may want to consider moving to a state that does not withhold state taxes for military retirees. Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming are states that do not have a personal income tax, but you may still have to pay federal taxes, so check with your accountant or tax preparer for more information on how your personal circumstances will change upon retirement. In addition, New Hampshire and Tennessee only tax dividend and interest income.

Medical Facilities
You may be in great physical condition as a 38-year-old military retiree, but how will you be feeling in another 15 or 20 years? Before you decide where to settle, consider your long-term medical needs by finding out as much as you can about the nearby medical facilities. Will you have easy access to Veteran’s Affairs (VA) services and is there a military installation nearby where you can access medical services? How will your TRICARE coverage change in your new location?

Serious health concerns may well be decades away, but if you plan to settle in your new location you should look into your medical options so that you can be better prepared when you need it the most.

Employment Opportunities
Many military retirees take on a second, or even a third career, after they are discharged from the military. Some positions offer Veteran Preference over other applicants, which is an added step up for those who need help returning to the world of work. Look at job postings on military installations to find out about possible job openings and Veteran Preference hiring opportunities that you are entitled to. 

Military retirement is a huge adjustment for new retirees. Before you decide where to move to following retirement, consider the benefits that you are hoping to keep hold of, or ones you would like to pursue. These include moving to a location where you will keep a greater portion of your retired military pay, have easy access to medical facilities and enhanced employment opportunities.  

Tags: military, retirement