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Tuesday, October 29, 2013

Now, transfer your EPF accounts online

Now, transfer your EPF accounts online - The Hindu var _comscore = _comscore || [];_comscore.push({ c1: "2", c2: "11398210" });(function() {var s = document.createElement("script"), el = document.getElementsByTagName("script")[0]; s.async = true;s.src = (document.location.protocol == "https:" ? "https://sb" : "http://b") + ".scorecardresearch.com/beacon.js";el.parentNode.insertBefore(s, el);})(); Follow Today's Paper Archive Subscriptions RSS Feeds Site Map ePaperMobileApps Social SEARCH

Home News Opinion Business Sport S & T Features Books In-depth Jobs Classifieds Shopping Bus tickets Cities Bangalore Chennai Coimbatore Delhi Hyderabad Kochi Kozhikode Madurai Mangalore Visakhapatnam Thiruvananthapuram Tiruchirapalli Vijayawada Cities» VisakhapatnamVISAKHAPATNAM, October 29, 2013 Updated: October 29, 2013 13:56 IST
Now, transfer your EPF accounts onlineNivedita GangulyShare · Comment · print · TweetTOPICS Andhra Pradesh Visakhapatnam
labour employee
Worried about transferring your Employee Provident Fund (EPF) account after a job change? Here’s some good news. For scores of employed professionals, the implementation of online transfer of EPF accounts has come as a relief. What used to be a laborious process is now expected to be reduced to a few days time.

“Earlier, it used to take one to two years for the EPF account transfer to take place. But with the start of the online transfer system, we are aiming to speed up the entire process and ensure that it happens within three days time,” said M. Jagadeeshwar Rao, Member of Central Board of Trustee, Employee Provident Fund Organisation (EPFO).

There are over 14 lakh EPF accounts that come under the purview of the Visakhapatnam Provident Fund Office, which caters to Srikakulam, Vizianagaram and Visakhapatnam districts.

Previously, the manual process of transferring the EPF account involved filling up of Form 13, getting it attested from the previous employer and submitting it to the Provident Fund Office. From thereon, the process would take a long time.

In the online transfer system, PF subscribers need to visit the website www.epfindia.com and click on ‘Online Transfer Claim Portal’ (OTCP) and follow the process. With this the money can get transferred from one account to another online. However, for online transfer of EPF account from a previous employer to the current employer, it is important that the digital signatures of these employers are registered with EPFO to verify claim papers online. The EPFO had started registering digital signatures of companies from July this year.

“With the introduction of OTCP, the EPF authorities are in the loop as soon as an EPF account transfer is initiated. In the earlier process, the employer would take a lot of time in submitting the Form 13 to EPF authorities, but EPFO did not have the scope of figuring out the delay in submission. But now, the process is faster,” said Mr Rao.

Currently, the online process is being upgraded in all the PF offices across the country. “There are some technical issues at some places, which will be fixed within the next two months,” Mr Rao added.

Keywords: Employee Provident Fund, EPF account, EPFO, PF subscribers, online transfer system

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Saturday, July 13, 2013

Save for College in Accounts for Minors With Tax Benefits

Parents have access to many account options with tax benefits, including 529 plans, to help save for their children’s college.

There's more than one way to save for college. Many parents sock away college funds in tax-advantaged investment accounts called 529 plans, but there are other account options with tax benefits available.

New York City-based financial planner Stacy Francis says the money in accounts called Uniform Gifts to Minors Act or Uniform Transfers to Minors Act accounts can pay for things 529 plan funds aren't eligible for.

A Uniform Gifts to Minors Act or Uniform Transfers to Minors account can be a savings or checking account, mutual fund account or brokerage account, says Thomas Kazmierczak, a 529 plan specialist with financial firm T. Rowe Price. "The main difference between this kind of account and any another account is selecting Uniform Gifts to Minors account or a Uniform Transfers to Minors account on the generic account registration form."

Often, these accounts are referred to as custodial accounts, which means a parent or guardian makes decisions about the account until the child comes of age, generally between 18 and 21, depending on the account and the state.

[Learn what steps to take in choosing age-based 529 plans.]

The main advantage of Uniform Gifts to Minors Act or Uniform Transfers to Minors Act accounts is the ability to save without paying taxes on up to $1,000 in earnings, no matter what the child will eventually use the money for in the future. The next $1,000 dollars is taxed at the child's federal income rate, which is normally lower than what the parents would be taxed, Francis says. If the $1,000 is the child's only income that year, no tax would be charged because the standard deduction would cancel it out, she says.

If a parent contributed $100 per month to the account and the account grew at 5 percent annually, that's nearly $30 of growth the first year, which wouldn't be taxed. If the parent continued to make $100 monthly contributions for five years with annual growth of 5 percent, the annual growth for the fifth year will climb to almost $300.

If the child doesn't earn any other income, the earnings won't get charged taxes potentially for years into the future.

Some parents may want to remain in control of the assets throughout their offspring's college career. If a 529 plan lists the parent as the owner, that parent is always the owner and decision-maker, no matter how old the child or adult gets.

However, with Uniform Gifts to Minors Act and Uniform Transfers to Minors Act accounts, a "downside is at that expiration, the assets belong to the child," says personal financial specialist Lisa Featherngill, managing director of planning for financial firm Abbot Downing.

Depending on an individual state's law, the child who is named as the beneficiary on a Uniform Transfers to Minors Act account gets full control of the funds somewhere between the ages of 21 to 25, though it's 21 in most states.

The Uniform Transfers to Minors Act account allows for more time for children to mature before they are given accounts, Francis says. Uniform Gifts to Minors Act accounts skew even younger: The account holder is generally given full control of all assets in the account at age 18, she says.

Whether a parent should set up a 529 plan account or an Uniform Gifts to Minors Act or Uniform Transfers to Minors Act account depends on whether or not the funds will be used for qualified education expenses. If parents saved in a 529 plan, they could be taxed on the portion of earnings not used for qualified education expenses, such as tuition and textbooks, and pay a 10 percent penalty on the unqualified education expenses withdrawal, Francis says.

"For example, if you contribute $100,000 into a 529 plan and it grows to $110,000 over time and you make an unqualified withdrawal for the entire amount, you are taxed on the $10,000 gain plus a 10 percent penalty on the $10,000," which would be $1,000, Francis says.

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Sunday, July 7, 2013

Find Sales, Contests for College Savings Accounts

Take advantage of states offering waived enrollment fees on 529 college savings accounts.

Ohio parent Beth Cousino didn't know what to think when she saw a Facebook post for a cash contest to celebrate 529 Day on May 29. She has 529 plans, tax-advantaged college savings accounts, for each of her three children, but she had never heard of the event, now in its fifth year.

"The posting asked me to like the Facebook page," she says. Following that prompt, Cousino entered the College Savings Plans Network's Facebook sweepstakes.

"I completely forgot I entered the contest," she says. Fortunately for her, Cousino won $529 that she put in her 15-year-old's 529 plan account.

When parents think about shopping sales for their children, they're probably not thinking about college savings plans. But 529 plans run specials and contests throughout the year.

[Learn how to earn high interest with 529 plans.]

May 29 and College Savings Month, in September, tend to be popular times for states to offer incentives like waived fees, says Mike Fitzgerald, chairman of the College Savings Plans Network. "We have seen as many as 40 states do promotions during College Savings Month in the past."

On 529 Day, Missouri, Nevada and Oklahoma were among the states that gave out $529 cash prizes for college savings. An interactive map on the national nonprofit's website showed parents what promotions were offered in different states.

Parents interested in boosting their college savings should look for the following year-round promotions.

[Learn when to save with another state's 529 plan.]

1. Sales and specials: States run a variety of sales for different kinds of 529 plans. In Washington and Pennsylvania, prepaid tuition plans, a type of 529 plan that allows parents to buy a set amount of tuition in advance, waived program enrollment fees in May.

In Pennsylvania, the $50 program enrollment fee for the PA 529 Guaranteed Savings Plan is waived in May, August, September and December, says Doug Rohanna, a Pennsylvania deputy state treasurer.

In August, Pennsylvania also runs a Beat the Rate special. During the month, parents can purchase tuition credits before the rates rise each September. The difference between buying a community college credit in August versus September last year was more than 5 percent.

2. Drawings: States such as Indiana, Nevada and Oklahoma give away money in random drawings. In Indiana, drawings for 529 certificate of deposit accounts worth $1,529 were held for 529 Day in certain bank branches.

"In September we'll give away two $2,500 529 plan accounts to winners of a random drawing" of people who register on the organization's website, says Jodi Golden, executive director of the Indiana Education Savings Authority, which oversees the state's CollegeChoice 529 plans.

"When we look at our budget and see we have money available from partnerships or sponsorships, we offer a promotion," she says. "Parents should check our website year-round for special offers."

[Employ workplace benefits to maximize 529 plan savings.]

3. Essay contests: In Nebraska, various contests are run throughout the year to give families a college savings boost.

One unusual contest asks grandparents to write a letter to their grandchildren about the importance of education. Grandparents can win between $1,000 and $1,500 for a grandchild's education.

View the original article here