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Top 5 Tax Season Tips
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January 6th, 2009 IRS launched the new tax filing seasons. IRS wants people to know that they are providing assistance to those who owe back taxes. The type of assistance range from postponement of collection actions, added flexibility for missed payments, to additional review for offers in compromise on home values. In addition, IRS made new features to their website to make it more user friendly.
Tips to keep in mind for the 2009 tax season.
1)Start collecting the necessary paper work early. For complex filers, sort receipts by type and then sort each type by date.
Common documents include
1098-E Tax Reporting Information for Account (Student loans)
1099-INT Interest Income statement ( Savings accounts)
Tax Return from last year (for reference)
W2 for all jobs.
If you have not received your W2 by January 31, call your company. Other documents and statement may also be available on the internet, if you have online accounts.
2)Save money by E -filing for free.
Visit IRS.GOV for a list of companies. Typically, you can file free federal online tax preparation and e-file if your adjusted gross income is $56,000 or less and you are age 50 or younger. You must link to the company through the IRS site.
www.irs.gov/app/freeFile/jsp/index.jsp
3) Laws have changed. Check the IRS website for new tax deductions.
*First-Time Homebuyers Credit
First-time homebuyers should begin planning now to take advantage of a new tax credit available for a limited time. The credit applies to primary home purchases between April 9, 2008, and June 30, 2009.
*Real Estate Tax Deduction
There is an additional standard deduction for those who don't itemize their deductions, but pay real estate taxes. The additional deduction amount is equal to the amount of real estate taxes paid up to $500 for single filers or up to $1,000 for joint filers.
*Tuition and Fees Deduction
You may be able to deduct qualified tuition and required enrollment fees up to $4,000 that you pay for yourself, your spouse or a dependent. You do not have to itemize to take this deduction.
*Recovery Rebate Credit
If you did not qualify or did not receive the maximum amount for the 2008 economic stimulus payment you may be entitled to a recovery rebate credit when you file your 2008 tax return.
4) Call the IRS they can help you for free. Don’t make unnecessary errors or pay a third party for simple questions.
IRS live assistance is available Monday through Friday. There is also a 24 hour recorded assistance line for your convenience. Telephone Assistance for Individuals: 1-800-829-1040 Businesses: 1-800-829-4933 Exempt Organizations, Retirement Plan Administrators, and Government Entities: 1-877-829-5500.
In addition, there are IRS Taxpayer Assistance Centers available for issues that are best handled face-to-face. Hours of service and other local information is provided on a per state basis.
5) Don’t forget to claim your charitable donations.
Between hurricanes, fires, local churches, and telethons, many people donate small amounts throughout the year, that can add up to a significant tax credit for this current tax season.
*For any contribution of $250 or more (including contributions of cash or property), you must obtain and keep in your records a contemporaneous written acknowledgment from the donee organization indicating the amount of the cash and a description of any property contributed, and whether the donee organization provided any goods or services in exchange for the gift.
Remember the last day to file without an extension is April 15, 2009.
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