Last Minute Tax Tips

April 13, 2009 by: The Tax Man

A few last minute tax tips this year. You do not want to miss these items on your tax return as you finish things off these last few days.

Bigger standard deduction

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Homeowners who pay state and local real estate taxes but don’t file an itemized return will receive a larger standard deduction. Besides the standard deduction, you can get the amount paid in real estate taxes last year, but not more than $500 for singles and $1,000 for joint filers.

This enhanced standard deduction benefits homeowners who have paid off their mortgage, those who have a small mortgage and those who bought a house late last year and haven’t paid much mortgage interest.

Rebate recovery

Taxpayers received checks of up to $600 for singles and $1,200 for joint filers based on information on their 2007 tax returns. If you didn’t qualify or you didn’t receive the full credit, you might be able to claim it now on your return if your finances have changed. This may be quite possible if you did not get a rebate check last year because your income was up because of capital gains and this year your income is lower because of fewer capital gains or even capital losses.

First-time homebuyer credit

A credit worth up to $7,500 is available to people who bought their first home between April 9 and Dec. 31 last year. This credit must be repaid over 15 years, making it an interest-free loan. It starts phasing out once income exceeds $75,000 for singles and $150,000 for joint filers.

Originally, the credit extended into 2009, but February’s stimulus act changed things. Now, if you buy from Jan. 1 to Nov. 30 this year, you will be eligible for a credit of up to $8,000 that doesn’t have to be repaid. You don’t have to wait until next year to claim it.

If you buy a house after you filed your 2008 tax return, you can amend your 2008 return and claim the credit.

IRA contributions – This tip that must be completed by April 15th

You have until April 15 to contribute to an individual retirement account for 2008. The maximum contribution is $5,000, ($6,000 if you’re 50 or older).

April 15th Deadline – and Extensions

Each of these tips can be done on your 2008 tax return. If you do not have enough time to file your return and do it properly then you can file for an extension. Simply complete for 4868 http://www.irs.gov/pub/irs-pdf/f4868.pdf and you have until October 15, 2009 to complete your taxes. Remember the extension is for filing your return, not paying the tax. If you think you owe taxes then send the IRS what you think you owe by April 15th. If you guess wrong and pay too much you will get a refund, if you pay them too little then you will be liable for penalties and interest..