1. Set aside some quality tax time. Brew a cup of Dunkin’ Donuts® coffee at home, find the materials you need to prepare your taxes, and retire to a quiet spot to get started. You can complete your return manually on paper, with Free File, or commercial software. If you use a tax professional, make sure to gather all your materials before sitting down with him or her.
2. Consider an extension. If, for any reason, you can’t file your income tax return on time, simply request a filing extension by April 15th. This gives you six more months to complete your return and avoid late filing penalties. Use Form 4868, which you can get at IRS.gov. But you still must pay now what tax you’ll owe to avoid late payment penalties.
3. Check out new tax breaks for certain 2009 purchases. If you bought a home, you may qualify for a tax credit. If you bought a new car, you may be able to deduct the sales tax. Find details about these new breaks at IRS.gov.
4. File electronically. To get your tax refund as quickly as possible, file your income tax return electronically and request that the refund be deposited directly in your account. You can have the deposit split among two or three accounts, including bank accounts, IRAs, health savings accounts, Coverdell education savings accounts, and a TreasuryDirect® account for I bond purchases.
5. Adjust your tax withholding or estimated taxes. Is it bad to be owed a tax refund? It’s nice to have the extra cash now, but getting a refund means you’ve really made an interest-free loan to Uncle Sam. A better strategy is to adjust your tax withholding or estimated taxes for this year so you pay an amount that is closer to the amount of tax owed; this gives you the use of your own money throughout the year.
6. Contribute to your retirement fund. The tax year is over but it’s not too late to put money in a regular or Roth IRA for 2009. Assuming you’re eligible, a contribution to a traditional IRA made by April 15th is deductible on your 2009 return. If you opt for a Roth IRA contribution, you can’t deduct it but will build up tax-free income for retirement.
7. Reap eco-credits. If you added insulation, energy-efficient windows, or solar panels to your home, you not only reduced energy costs but also may now qualify for a tax credit. The credit limit for installing solar panels and other alternative energy additions is 30% of cost; for other improvements, there’s a $1,500 cap. The tax credit reduces your tax bill dollar for dollar.
8. The standard deduction isn’t standard anymore. If you don’t itemize, you may be able to bulk up your standard deduction by adding amounts for being a senior, paying property taxes on your home or sales tax on a car purchase, or for suffering a loss in a federal disaster. But you’ll have to complete a new form, Schedule L, to total up your standard deduction.
Order a free sample of the new flavor, Dunkin’ Turbo: https://dunkinathome.safeprocessing.com/(S(qwglte55ct1kxe455nv0xs55))/Offers/DunkinAtHome/148/Offer.aspx
Barbara Weltman is an attorney, prolific author with such titles as J.K. Lasser’s Small Business Taxes, J.K. Lasser’s 1001 Deductions and Tax Breaks, and The Complete Idiot’s Guide to Starting a Home-Based Business, and trusted professional advocate for small businesses and entrepreneurs. She is also the publisher of Idea of the Day® and monthly e-newsletter Big Ideas for Small Business® at www.barbaraweltman.com and host of Build Your Business radio. Follow her on Twitter at BarbaraWeltman.
© The J.M. Smucker Company.
© 2010. DD IP Holder LLC (as to Dunkin’ Donuts and all other trademarks, logos and trade dress of DD IP Holder LLC) used under license.
This post is provided by Stephanie Robinson at The Product Review Place and the above companies. I was not provided any compensation for posting this information. I will not be held liable for any information above that was provided for this post.