My 11-year-old earns money umpiring baseball games. Can he open an IRA? Will it affect his college aid? — Rick Gross, Avon, Conn.
Assuming Junior is willing, a Roth IRA (which grows and can be tapped tax-free) is a home run. In 2013 he can put in the lesser of $5,500 or his earned income. Does he earn just a few hundred dollars? You'll need a firm with a low minimum, such as Charles Schwab.
Don't worry about college. IRAs aren't used to set federal aid. Though about 260 schools doling out aid ask about IRAs, retirement money is counted only sometimes, such as when a wealthy family has split up assets, says FinAid.org publisher Mark Kantrowitz.
Your son may make too little to file taxes, says H&R Block's Gil Charney, but it's not a bad idea to save W-2s or 1099s proving earned income.
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What are the advantages and disadvantages of real estate investments overseas? —DANIEL L., New York City
Direct investment in foreign property, be it a mall or a second home, is a risky proposition. Sure, you could nab greater gains than in the U.S., should you be smart, knowledgeable, and lucky. But noncitizens can face extra expenses and red tape, and back in the U.S., you're subject to complex investment rules, warns Rapid MOREMay 11, 2013 6:30 AM ET
If I retire overseas, can I lower my taxes by declaring residency in any state I want? — C. Czuchna, Gainesville, Va.
Not quite. You can't just declare residency; you have to live there before taking off. Steps to show you've really moved to the no-income-tax state of your dreams (such as Florida, Nevada, or Texas): buying a home (and selling your old one), getting a driver's license, and registering to vote.
Do MOREApr 27, 2013 6:30 AM ET
Can I take money tax-free from my 401(k) for a down payment on a home? — Dev Ananth, Plano, Texas
You may be able to pull money out, but you can't avoid taxes. And that's not the only downside.
Most plans let you borrow half of your savings, or $50,000 (whichever is less); you'll repay that with after-tax dollars — not the untaxed dollars you contributed originally. Leave your job without repaying and MOREApr 13, 2013 6:30 AM ET
I have made a formal loan to my adult child. Do I have to report the interest I receive as income? — J.H., Texas
Yes, interest you earn on a personal loan is taxable and should be reported to the IRS. The figure goes on line 8a of your 1040; if all your taxable interest income in a year exceeds $1,500, you also have to file Schedule B, which records interest and MOREApr 6, 2013 6:30 AM ET
I put tax-deductible and nondeductible money in my IRA. What comes out first? — Duane Hoffmeyer, Mesa, Ariz.
Most money in traditional IRAs comprises tax-deductible contributions and any account earnings over the years, all of which is taxable when you pull the money out. You evidently also made nondeductible, after-tax contributions, which exit your IRA tax-free.
To answer your question, the funds come out simultaneously. Add up your after-tax contributions. The percentage of MOREMar 31, 2013 3:17 PM ET
I own a home in Connecticut. I'm currently paying taxes on rooms that I don't use or need. For instance, I finished a bonus room over my garage and fifth bedroom in my attic with heat and sheetrock. Can I "unconvert" these unnecessary rooms to lower my property taxes? – Debra L.
Yes, you can — but it may not make sense to do so. As Newton Buckner, partner at Hartford, MOREDec 28, 2012 6:30 AM ET
I want to pay cash to buy my sister a $110,000 house where she can live in retirement. Should I title it in her name, my name, or both her name and mine? What are gift tax or other tax consequences? We are both in Ohio. — Frank M.
Ultimately the decision of whether or not you give a house to your sister is a personal one. But Gerald Townsend, a MOREDec 27, 2012 6:30 AM ET
If I give someone a gift over $13,000, what taxes will each of us owe? — Margaret G., Raleigh, N.C.
Good news about the oft-puzzling gift tax: Whatever the size of your gift, the recipient neither owes tax nor needs to report it. You, the giver, have to file Form 709 for a gift over the IRS' annual per-recipient limit ($13,000 in 2012 and rising to $14,000 next year). But you won't MOREDec 25, 2012 6:30 AM ET
Do you pay a tax on silver or gold coins when purchased or sold? What are some of the advantages and disadvantages of gold and silver coins as an investment? —Vernon
When you buy coins, you may owe sales tax, depending on which state you buy in. But selling triggers a very different tax, says Rob Chapman, founder of Rochester, N.Y.-based advisory firm Compass Wealth. Because the IRS considers precious metals MOREDec 24, 2012 6:30 AM ET
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