Retirement Savings

Top 10 Tax Tips for 2009

Retirement plans offer various tax benefits. It is important to remember their deadlines and limits, and take advantage of all of the perks they offer. For more information, see IRS Summertime Tax Tip 2008-17.

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Top 10 Tax Tips ... Are you ready for tax season? Gather your receipts, sharpen your pencil and check out these 10 tips before you file.
The Benefits of ... Have you cashed in on all of the tax perks that owning a home offers? Your house is a giant tax deduction. Remember to deduct your property taxes, your mortgage interest, points you paid when purchasing the house, and home improvements required for medical care. For more information, see IRS Financial Resources - Real Estate.
First-Time Homeb... Take advantage of a new tax credit that's only available for a limited time. The First-Time Homebuyers Tax Credit applies to primary home purchases between April 9, 2008 and June 30, 2009. The credit is 10% of the purchase price of the home, with a maximum available credit of $7,500 for either a single taxpayer or a married couple filing jointly. For more information, check with the IRS.
Tuition and Fees... Remember to utilize all possible deductions, including those for tuition and fees. The tuition and fees deduction covers up to $4,000 that you pay for yourself, your spouse or a dependent, and you don't have to itemize to qualify for this deduction. For more information, see IRS Form 8917.
Educator Expense... Are you a teacher? If so, make sure you take advantage of the educator expense deduction that allows you to deduct the cost of books, supplies, equipment, and software used in the classroom up to $250. For more information, see IR-2005-82.
Earned Income Ta... Did you work but not earn a whole lot in 2008? You might be able to cash in on the Earned Income Tax Credit (EITC). The EITC is a refundable tax credit, meaning it could lead to a tax refund even if you did not have federal income tax withheld. For more information, visit irs.gov/eitc.
Child and Depend... Do you pay for child care? You can use these expenses to minimize your tax bill. Through the Child and Dependent Care credit the IRS allows you to recoup a percentage (up to 35 percent) of these costs (up to $6,000 for two individuals). For more information, see IRS Tax Tip 2008-46.
Jury Pay Paid to... Did you fulfill your civic duty in 2008? If your employer continued to pay your salary but request your jury pay in return, the IRS demands that you report those fees as taxable income. But you have the right to deduct this amount so that you are not taxed on money that only passed through your hands. For more information, see IRS Tax Tip 2008-12.
Crackdown on Off... Don't use offshore credit cards. It might sound great to put your cash in an offshore tax haven and access it through a bank credit card, but it is an illegal tax-evasion scheme that the IRS is cracking down on. For more information, read up on the IRS Offshore Credit Card Program.
First-Job Moving... While job-hunting expenses are not deductible, some moving expenses are. If you moved more than 50 miles for your new job, you can deduct the cost of getting yourself and your household goods to the new area, including 20 cents per mile (plus parking fees and tolls) for driving your own car. For more information, see IRS Summertime Tax Tip 2008-19.
Retirement Savin... Retirement plans offer various tax benefits. It is important to remember their deadlines and limits, and take advantage of all of the perks they offer. For more information, see IRS Summertime Tax Tip 2008-17.