How to avoid Medicare late enrollment penalties

Pricey Liz: I am 65, nevertheless operating and have overall health insurance policies by means of my employer. I have not enrolled for Medicare and have been instructed I do not require to. I prepare to at the time I retire. There is a passage in my Social Stability assertion that claims, “Because you are by now 65 or older, you really should call Social Stability to enroll in Medicare. You may possibly be issue to a life time late enrollment penalty. Unique procedures may well use if you are protected by certain group wellness designs by means of do the job.” I have experimented with to analysis even further by way of the Medicare internet site but cannot uncover a distinct response about no matter if or not I am Okay not enrolling at this time.

Solution: If your employer has 20 or extra staff members, then you’re fine for now. When you quit working for that employer, you will have eight months to indicator up for Medicare without the need of owing penalties.

If you want your Medicare protection to start when your career-based mostly protection finishes, while, you should really signal up a month before you retire. Comparable procedures would utilize if you were being lined by a spouse’s office overall health insurance program. As lengthy as your wife or husband is nonetheless working for the employer that delivers the protection, you can avoid long term Medicare penalties.

If your employer has much less than 20 employees, on the other hand, you may perhaps be required to indication up for Medicare when you’re first eligible. Check with your employer.

Newlyweds’ home sale taxes

Dear Liz: You not too long ago wrote about how home sales are taxed but I have a dilemma. My son was solitary when he acquired his condominium. He is now married and setting up on promoting it. Does he qualify for the $250,000 exclusion or the $500,000 exclusion?

Answer: As you know, the exclusion allows residence sellers to keep away from money gains taxes on a sure quantity of revenue as extended as they owned and lived in the home at the very least two of the previous five several years. With married partners, only a single husband or wife requires to fulfill the ownership examination but both of those ought to meet the “use” check. In other phrases, the two your son and your son’s wife or husband need to have lived in the property for at minimum two yrs before the sale for the few to qualify for the $500,000 exclusion. The couple have to file a joint return in the 12 months they offer the condo, and neither husband or wife can have excluded gain from the sale of another dwelling all through the two-calendar year interval before offering this house.

Credit scores and utilization

Dear Liz: Thanks for your modern column about how credit scores respond to heavy credit rating card usage. We spend our credit score cards in whole each individual thirty day period but not long ago we experienced massive rates on a few cards for holidays, house supplies and other buys. I am the most important account holder on all three cards and my credit scores tanked! I even received e-mail warnings about it from my credit history monitoring services.

I have paid off two of the playing cards and will shell out off the 3rd 1 quickly. My husband has one credit history card in his own title that he sometimes works by using and he is an authorized consumer on the many others. I have often been the fanatical money partner so he thinks it’s amusing he has terrific scores and I glance like a loser! Great issue we were not setting up to do a household order or refinance the mortgage loan.

Answer: Very quickly your husband will have to locate something else to tease you about. Your scores are likely to return to their previous ranges when the superior balances are paid off and you return to your typical spending behavior.

A lot of folks are shocked by how radically credit history scoring formulas react to the total of offered credit rating they are employing. But this awareness can help you the subsequent time you’re arranging to get a important mortgage.

For case in point, you could throttle back your credit rating card use setting up a couple of months right before your software. Alternatively, you could make weekly payments as a substitute of month-to-month types to make sure the balances reported to the credit history bureaus, and used in your scores, are as minimal as probable.

Yet another method is to pay out off your balance a few days before the statement closing date, considering that the equilibrium on that day is the just one that is usually reported to the bureaus. (If any rates clearly show up right after you’ve paid off the stability, you are going to need to make a 2nd payment prior to the because of date to avoid late charges.)

Liz Weston, Accredited Monetary Planner, is a own finance columnist for NerdWallet. Queries may perhaps be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by employing the “Contact” form at asklizweston.com.