 Mandatory Arbitration
Recently more financial institutions and credit card companies have included Mandatory Arbitration clauses in the fine print of their agreements. Consumers quite possibly have signed these agreements unaware of the existence of these clauses or their implications.
Arbitration means the dispute is handled between two parties by a third party who is considered neutral. The obvious objective is to relieve the legal system of embattled court proceedings. Arbitration appears to be more flexible and quicker in resolving these disputes for a variety of reasons, however, consumer advocates are scrutinizing the process to protect individuals and keep them informed of their rights.
Some tips consumers should follow: (These are taken from an article posted on the Web site www.bankrate.com which is one of the links listed on this web page).
Read the fine print. Use of a credit card after a change in terms notice may mean you are agreeing to those terms therefore read all changes in terms. Read the fine print.
If you have a dispute with your credit card company, first try to resolve the matter with the bank by following the dispute procedures spelled out in your agreement. Your correspondence must be in writing to guarantee protection under the Federal Fair Credit Billing Act.
Keep all receipts, contracts, copies of correspondence, warranty information and the agreement you signed in case a dispute should arise.
Educate yourself. Websites for most arbitration administrators have information about their services including costs and procedures. You can check them out.
For further information about the article on bankrate.com's Web site entitled "Mandatory Arbitration Clauses Have Consumers Signing Away Their Right to Sue," you can follow this link to www.bankrate.com. If that article has been removed from the Web site and you would like to see a copy of it, e-mail infoarbitration@ozeck.com.
College Financial Aid
Most families with members attending college or other secondary educational institutions are not paying for that education entirely out of their own funds.
There are a variety of sources being used today to help pay for higher education. These sources include loans, scholarships, tuition credits, fellowships, work study awards and grants. Many of these have tax repercussions.
Scholarships, fellowships and grants are basically a reduction of tuition. In most cases, they are treated as non-taxable income for federal income tax purposes. There are certain conditions that need to be met to insure they are non-taxable.
Other tuition reductions include tuition discounts to employees of educational institutions. This is considered an employee benefit. These tuition reductions are in most cases tax free as long as certain requirements are met.
Work study programs are a form of financial aid where students are provided jobs to help pay for their college education. These wages are taxable as income. When students are employed directly by the school they attend, social security and medicare normally do not apply, however, there are certain exceptions.
The economic characteristics of financial aid are the driving force which will determine the taxability of this assistance. The key question will always be, is the student obligated to provide any services in exchange for financial aid? For a more detailed report on "Taxation of College Financial Aid," please contact our office.
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Charles J. Ozeck, CPA
Serving Clients in Southeastern Pennsylvania and Nationwide
601 W. Callowhill Street, Perkasie, PA 18944
Phone (215) 453-8319
Fax (215) 453-0764
E-mail co@ozeck.com
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