Financial Q&A: A hunt for a low-interest loan, separated couple ponders how to file taxes

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Do you know of a philanthropist or company that can offer me a low-interest loan to pay off credit-card debts – even if my credit score is at an all-time low of 525? I pay my bills, but I had to temporarily stop paying some credit cards in order to negotiate lower interest rates and payments. That killed my score.

A.G.N., via e-mail

A: A comforting thought, but no, there are no known financial sugar daddies who make a habit of loaning strangers money to repay bills. Your best bet probably lies with contacting a reputable counseling service that can both help you arrange repayments to creditors and teach you how to better handle your personal finances.

Contact the National Foundation for Credit Counseling at 800-388-2227 or to find a credit-counseling agency near you that charges either nothing or a very low monthly fee. (Be very wary of anyone wanting a fee up front or who promises to "repair" a tattered credit score.)

One such helper is ClearPoint Financial Solutions, based in Richmond, Va. Ann Estes, vice president for education there, says it can teach clients dealing with financial distress how to get back on track.

In really tough situations, Ms. Estes says counselors can work directly with creditors to lower interest rates and help to eliminate the monthly fees being charged.

"This way, you're able to regain a sense of financial control during your hardship," she says.

It is very important to make a concerted effort to make a consistent monthly payment, says Ms. Estes. If that is not possible, contact the creditor if you absolutely cannot make the payment.

My husband and I recently amicably separated and have no plans to divorce. What are the tax implications if we decide to file for legal separation? Would we pay less in taxes if we continue to file a joint income-tax return each year? Or should we file separately since we are living at separate addresses?

M.R.C., Santa Fe, N.M.

A: As is the case with many tax-related issues, it sort of depends on your particular situation. Ellen Jordan, vice president of Bryn Mawr Trust Wealth Management, in Bryn Mawr, Pa., says that in most instances filing a joint return with your spouse should save taxes. But if you personally have high itemized deductions in relation to your income, you may pay less tax if you file separately.

Also note that when you file a joint return with your spouse you're both liable for the taxes due. If there should ever be an issue or your return is audited, both you and your spouse are responsible.

Filing for a legal separation is handled on a state basis, says Ms. Jordan, so you should check with a local attorney. The IRS interpretation most likely (again check with an attorney or accountant in your state) is that filing for a legal separation entitles you to file as a single person. Unfortunately, there is no definitive answer – each couple's situation is different.

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