Economic Downturn Provides Tax Relief for Many Filers This Year
Texas CPAs Offer Tips for Tax Filers Affected by the Economy
The 2008 tax filing deadline is only three weeks away and the Texas Society of CPAs (TSCPA) wants to remind you of some handy tax tips, especially if you’ve been affected financially by the economy. For those negatively impacted by the economy, the Internal Revenue Service (IRS) may offer tax relief. Texas CPAs advise you to keep the following three tax tips in mind:
Tip #1 Income reduction can offer tax credits.
If you had a reduction in income in 2008, you may be eligible for a tax credit. For example, the Earned Income Tax Credit (EITC) is available for working families and individuals. Eligibility is determined by income and family size. You must file an income tax return in order to claim EITC, even if you didn’t make enough to be obligated to file a return.
Tip #2 Many Job search expenses are tax deductible.
If you were looking for a job in 2008, certain expenses you incurred may be deductible. Some deductible expenses are employment and outplacement agency fees, resume preparation, and travel expenses for job search and interviews.
Tip #3 There are steps to take if you can’t pay your bill on time.
You should still file a tax return by April 15 even if you are unable to pay so you can avoid additional penalties. You should also contact the IRS as soon as possible if you think you may have trouble paying your tax bill. They should be able to provide some kind of relief in the form of a payment extension, payment installation plan or another comparable offer.
Turn to your CPA
In a weak economy, people are seeking any tips and information they can find on tax breaks and credits. Your CPA can help. He or she can offer advice that will enable you to make smart financial decisions. For additional tax tips, visit the Tax Talk section on TSCPA’s consumer Web site www.ValueYourMoney.org. There you will find filing guidance, commonly overlooked tax deductions, a large frequently asked questions section, and more.
Source: Texas Society of CPAs