KANSAS CITY, Mo. Life changes can mean tax savings. From the homebuyer credit to parenthood, to higher education and buying a new car, changes in the tax code affect the complexity of the 2010 tax filing season and could mean more money in taxpayers pockets.
Taxes arent just a one-day, annual event, said Amy McAnarney, executive director of the Tax Institute at H&R Block. They are something you should think about year-round. With close to 300 tax changes last year alone, taxpayers likely will need assistance getting the maximum tax benefit.
Overall, the changes help taxpayers in five key areas:
Buying a home: More American homebuyers will get tax relief thanks to changes and expansions made to the First-Time Homebuyer Credit. There are two major provisions of the homebuyer credit to keep in mind:
1.Up to a $6,500 tax credit for existing homeowners in the market to move.
2.A new closing deadline of April 30, 2010 extended from Nov. 30, 2009 for the $8,000 First-Time Homebuyer Credit. Also, a special provision gives taxpayers two extra months to close if they entered into a contract by April 30, 2010.
Workers: Due to the Making Work Pay Credit, millions of taxpayers could find themselves with a tax surprise unless they adjusted their withholding last year. Taxpayers who should take special care in understanding the implications include:
1.Married couples with two incomes
2.Individuals with multiple incomes
3.Retirees who have taxes withheld from a pension or social security benefits
4.Individuals who work but who can be claimed as a dependent on someone elses tax return.
Parenthood: The recovery act expands the Child Tax Credit, allowing families to begin qualifying for the credit with every dollar earned over $3,000. For taxpayers, this change translates into a refundable credit of up to $1,000 for each qualifying child under 17 even if the taxpayer has no tax liability.
Higher education: Taxpayers getting a higher education or supporting a dependent in college should be aware of several tax credits and deductions. More taxpayers will be able to qualify for the American Opportunity Tax Credit, with a new, partially refundable $2,500 tax credit for college tuition paid in 2009.
In the garage: Taxpayers who purchased a new car, motorcycle, or even motor home can deduct the state and local sales and excise taxes paid on the purchase as long as the vehicles were purchased between Feb. 17 and Dec. 31, 2009.
Get a refund faster with e-file
With e-filing, you can get your refund in as few as two weeks. E-file is a quick, easy and smart way to file taxes and free at H&R Blocks 11,000 offices and digital products. More than 73 million Americans took advantage of e-filing their taxes last year. It increases accuracy, saves paper and will even work if you have a balance due. E-filing began Jan. 15.
About The Tax Institute at H&R Block
The Tax Institute at H&R Block is the go-to source for objective insights on federal and state tax laws affecting the individual. It provides nonpartisan information and analysis on the real world implications of tax policies and proposals to policymakers, journalists, experts and tax preparers. The Institutes experts include CPAs, Enrolled Agents, attorneys and former IRS agents who draw from years of experience and H&R Blocks extensive network of resources. For more information visit our press center at http://thetaxinstitute.com.
About H&R Block
H&R Block Inc. (NYSE: HRB) is the worlds preeminent tax services provider, having prepared more than 500 million tax returns since 1955. In fiscal 2009, H&R Block had annual revenues of $4.1 billion and prepared more than 24 million tax returns worldwide, utilizing more than 100,000 highly trained tax professionals. The Company provides tax return preparation services in person, through H&R Block At Home online and desktop software products, and through other channels. The Company is also one of the leading providers of business services through RSM McGladrey. For more information, visit our Online Press Center at www.hrblock.com