6 Certifications to Take Your Career To The Next Level For $100 or Less

Developing further skills can boost your career at any stage.

"File:Knight-Crane Convergence Lab - Flickr - Knight Foundation.jpg" by Knight Foundation is licensed under CC BY-SA 2.0

Whether you are looking for a new job or trying to grow in your current one, getting a certification can be a great way to improve your skills.

Anyone can put that they are proficient in a computer program on their resume but having a certificate can help you stand out amongst the competition and give credence to the strength of your skills.

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What You Need to Know About Taxes If You Collected Unemployment

Taxes are a confusing topic in any year, but collecting unemployment ads an entirely new layer.

"Taxes Key" by Got Credit is licensed under CC BY 2.0

Tens of millions of Americans collected unemployment last year, many for the first time. You may be doing taxes after collecting unemployment insurance for the first time, and it is important to note that the process is different in a few key ways from traditional employment.

When you start a new job, your employer will typically set up tax withholding, where you pay your taxes out of each paycheck and calculate any refunds or additional payments owed come tax time. Jobless aid is taxed similarly to income but does not usually have taxes automatically taken out. This is likely to lead to millions of Americans facing a surprise tax bill this spring as Goldman Sachs estimates taxes on unemployment insurance received last year could reach $50 billion. 38% of Americans receiving benefits were unaware that unemployment insurance is taxable and could be staring down a major financial shortfall.

If you collected unemployment last year, here's what you need to know as you prepare your taxes.

1. You don't need to pay Social Security or Medicare taxes

You will be expected to pay taxes on unemployment benefits, but those taxes will be slightly less than if you had received the same amount from traditional employment. That is because they are exempt from Social Security and Medicare taxes, both of which total 7.65% for a usual worker. This means you may be paying a lower tax rate than you expect.

2. You might not need to pay state taxes

If you live in one of the nine states (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming) with no state income tax, your unemployment benefits will also not be taxed on the state level. However, five additional states exempt unemployment insurance from taxation. These states are California, Montana, New Jersey, Pennsylvania and Virginia. If you live in one of these states, you only need to worry about federal taxes on your unemployment benefits. You will likely still need to file taxes for any income from regular employment, but this amount will be much less than if your jobless benefits were also taxed at the state level.

However, things get a bit tricky if you live in Indiana or Wisconsin. Both of these states may allow you to exempt a portion of your jobless benefits from taxation, depending on your total income. In both states, you will need to fill out your "Unemployment Compensation Worksheet" to see if you can exclude any portion of the payments you received.


The United States is a patchwork of different tax policies when it comes to unemployment. Know what your state's policy is.

3. Your stimulus payments are not taxable

The federal government issued two rounds of stimulus payments last year; one in April and one in December. These economic income payments are not taxable and are separate from your jobless aid.

4. The government still has time to reduce your tax bill

If you collected unemployment last year, you might want to consider waiting a bit longer before filing taxes. That's because in February of 2021, Sen. Dick Durbin, D-Ill., and Rep. Cindy Axne, D-Iowa, introduced the Coronavirus Unemployment Benefits Tax Relief Act. If passed, this would waive federal income taxes on the first $10,200 of unemployment benefits received in 2020. This would be a larger version of 2009, when lawmakers provided a similar exemption for up to $2,400 in jobless aid. Right now, it is unclear how likely this bill is to pass both chambers. You may want to consider filing closer to the April 15th deadline or prepare to file an amended return if it does become law.

5. There are options if you cannot afford to pay your tax bill right now

If you haven't set aside enough to pay your tax bill this year, you are not alone and there are other options. The IRS does allow you toapply for a payment plan as well astemporarily delay the collection of your tax debt. Both of these may entail paying interest and fees on top of your tax bill, but this will be much less than if the IRS has to take collection action against you.

If you cannot pay your tax bill by April 15th, contacting the IRS for a payment plan can help you avoid stiff penalties.


6. If you are still on unemployment, set aside money for next year's tax bill

If you haven't been setting aside taxes on your unemployment benefits, you may want to start now to avoid a tax headache next year. Log on to your state's unemployment benefits portal and update your withholding. The federal government will withhold 10 percent of your unemployment income toward your taxes. If you don't, you are still on the hook for the taxes and must determine and pay quarterly estimates on your unemployment income.

7. You may qualify for new tax deductions and credits

Many people saw their incomes reduced by going on unemployment, and this could open up new opportunities to save on your taxes this year. If you were able to work for part of the year, you may now qualify for the Earned Income Tax Credit (EITC), a credit for working people with low to moderate income. Unemployment is not considered "earned" income in this case, so you will likely only qualify if you earned income from traditional work this year. Your exact qualification will depend on a variety of factors including your dependents, your filing status, and your total earned income.

If you were able to save last year, you may also be able to qualify for the saver's credit. This would allow you to receive a credit of between 10% to 50% of your contribution to retirement account, depending on your income and filing status. Remember that you still have time to claim this credit as the deadline to contribute to last year's IRA is not Tax Day this year. If you qualify, you may wish to make a contribution before filing taxes in order to claim the credit.

Your state may have additional credits for you to take advantage of, such as the income-based renter's credit in thirteen states. Look at the tax credits available in your state to take full advantage of any help available in what may be a lower-earnings year for you.

Disclaimer: Paypath and its affiliates do not provide tax, legal or accounting services. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. If you have any concerns regarding your unique tax situation, you should consult your own tax, legal and accounting advisors.

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Are Your Taxes Going Up In 2021?

Some have alleged taxes will be going up in 2021. Are they right?

"IRS 1040 Tax Form Being Filled Out" by kenteegardin is licensed under CC BY-SA 2.0

The Tax Cuts and Jobs Act of 2017 (TCJA) is the hallmark legislation of the Trump administration, and no American taxpayer was unaffected. But was this legislation a Trojan horse that could lead to you paying higher taxes starting in 2021?

The Joint Committee on Taxation released a chart indicating that federal taxes for those making between $10,000 and $30,000 would actually go up starting in 2021.


A table describing distributional affects of the TCJA by income.Joint Committee on Taxation

The new tax brackets for 2021 have the same rates, and the only changes are the income brackets that have been adjusted for inflation. What's driving this higher tax rate for these particular brackets?

That links back to the Republican efforts to repeal the Affordable Care Act. The TCJA lowered the individual mandate penalty, the penalty paid to the government if you do not have a health insurance policy, to zero. This means there will be no tax implications to not carrying an insurance policy.

Under the ACA, individuals within 100% and 400% of the federal poverty level were eligible to receive tax credits to offset the costs of these plans. With no individual mandate penalty, the expectation is that less people will sign up for insurance. Less people signing up for insurance will lead to less people receiving the tax credits, which would lead to an increase in the average tax rate across this group.

That doesn't mean that you are in the clear if you make above $30,000. Remember how income brackets are adjusted for inflation? The TCJA also changed how inflation is calculated. Tax brackets used to be adjusted off of the Consumer Price Index (CPI), an index that tracks the prices of goods and services across different geographical areas.

The Consumer Price Index tracks how much more you are paying because of inflation each year. But the IRS now measures inflation against the chained CPI. The idea behind the chained CPI is that if prices rise, customers will change their purchasing habits and substitute goods. For example, if the price of orange juice rises faster than the price of apple juice, chained CPI assumes that people will lower the amount of orange juice that they are buying and substitute that by buying more apple juice. CPI tracks a fixed basket of goods while the basket of goods tracked by chained CPI changes periodically.

Because chained CPI assumes that consumers are going to seek out substitutes for products with rising price tags, it rises more slowly than traditional CPI. Thus, the IRS will adjust tax brackets upward more gradually, and you are likely to move into a higher tax bracket faster than you would under the old calculations.


A graph showing chained CPI rising at a much slower rate than CPI from 2000 to 2020Chained CPI calculates the cost of everyday goods rising more slowly than calculations based on traditional CPI.Federal Reserve Bank of St. Louis


If the cost of consumer prices rises 2% and you receive a similar 2% raise, normally you would be able to maintain your lifestyle. However, if the tax brackets only increase 1.5% because tax brackets are now tied to chained CPI, you will be paying more in taxes because your income and expenses will be rising faster than the rate the IRS is using. Because the tax rate is being adjusted for 2021 and will be adjusted in future years, this will compound over time, and has led to a slew of recent articles discussing a tax hike starting in 2021.

Congress passed the TCJA through budget reconciliation to avoid a filibuster, but that meant that the law could not increase the long-term budget deficit. As a result, Republicans decided to include a provision to have the individual tax cuts expire in 2025 while making the lower corporate tax rates and the chained CPI method of adjusting tax brackets permanent. The increased standard deduction and the larger child tax credit will also expire at this time. And because of the continued use of the chained CPI method, people will actually be paying higher taxes after the TCJA then they would if it had never been passed in the first place.


The change in federal taxes by year from the TCJA broken out by income distribution.Joint Committee on Taxation

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The Federal Funds Rate and How It Affects You

The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.

"Federal Reserve Building in Washington D.C. - Illustration" byDonkeyHotey is licensed underCC BY 2.0

When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.

A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.

One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.

The Federal ReserveThe Federal Reserve


The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.

This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.

The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.

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