Tax Tips

3/17/2009

Fort Worth, TX – With tax time upon us, here are some tips to keep in mind. Your economic stimulus payment for last year should not be included as income when you file your 2008 tax return. Most people received the maximum economic stimulus payment in 2008. However, some people may be eligible for a first time credit or a larger payment than they were eligible for last year. This amount is called a Recovery Rebate Credit. You will need to know the amount of your stimulus payment from last year to determine eligibility. You can find out how much your stimulus payment was in 2008 by going to the IRS home page at www.irs.gov and clicking on "How Much Was My Stimulus Payment" at the bottom left on the home page. There is also a new property tax deduction for homeowners. Get your full sales tax deduction by adding your local sales tax to the state sales tax tables. First-home buyers are eligible for a deduction of the smaller of either $7,500 or 10% of the purchase price of the home. Those eligible need to be aware that this is really a loan and not a deduction; if you take advantage of this provision, you will have to repay the amount in 15 annual payments beginning two years later. Many mutual fund holders will need to brace themselves for the shock of having to pay taxes on capital gains on funds that have shrunk substantially in overall value. Finally, many persons eligible for the earned income tax credit do not take it. The earned income tax credit is a refundable credit for low-income working individuals and families. The amount of the credit depends on income and family size. The IRS website has extensive information that will help you with your taxes as well as a broad range of forms.