CSN, Book Giveaway Winners

The winners in the CSN Stores giveaway, and the financial book giveaway on PFStock have been drawn. For the CSN Stores drawing, "Annette E" will be receiving a $40 CSN Stores gift certificate from PFStock. For the book giveaway, Brandy Byrne will receive a copy of the book "Psych Yourself Rich" by Farnoosh Torabi.

Congratulation to the winners! For those who didn't win, please check back for future giveaways. Also for the 2011 Tax Tips Contest there were five winners drawn over five weeks. I have compiled a list of some of the best tax and money saving tips that were submitted by readers.

Thanks to everybody who entered. Even if you didn't win a prize, I hope that you will continue reading PFStock.

DC

Tax Tips Giveaway: Final Week

The 4th of 5 winners in the PFStock Tax Tips Giveaway 2011 is Linda Fish. She will be receiving free H&R Block At Home Online Tax Preparation. If you haven't entered the drawing yet, please the is only one more chance to do so. The deadline to enter the last drawing is this Friday, February 11.

Here are some more user submitted tax tips that I've received:

• My advice is to not lie about your income. Be honest and pay your taxes.
• If you find you owe every year and adjusting your with holdings just isn't working out make sure to take the number you owe each year, divide it by the amount of paychecks you get per year, and stick it in a high yield online savings account. I say add at least $5-$10 more per paycheck so you have a cushion. In the worst case, you will have extra savings!

Please keep your tax tips coming, and good luck to everybody who enters. This contest will run through February 11.

PFS

How to Report a Class Action Settlement

In June of last year, I mentioned receiving a $628.65 check from E*TRADE. This was the result of a class action settlement in the case of Greenberg v. E*TRADE. To give some background, the settlement arose out of allegations that E*TRADE recorded telephone calls without notifying the other party that they are being recorded. When I received my check back in June, I was surprised at the amount of the settlement.

Last week, I received a 1099-MISC form that lists the amount of $628.65 as "other income". As I mentioned in my previous post, only people in California were entitled to the full $628.65. People in other states received one-fifth of that amount or $125.73. Did anybody else get a 1099-MISC for this settlement?

The real question at this time is "How is one supposed to report this payment on their taxes?" Some readers have indicated that they've received conflicting information about how to account for this windfall. However, I believe that the correct answer is to report it as "Other Income" (This is Line 21 on Form 1040). But, I want to ask my readers if they agree that this is correct?

Disclaimer: This discussion is for information only. PFStock does not provide tax or investment advice. I encourages readers to consult with a tax adviser if they have specific questions when preparing their taxes.

DC