Get yo’ tax on.
Tax season is getting closer and now is a good time to prepare. Several laws have changed this year, and some positive and negative things arise.
Here’s a notable point to kick the article off and give you some motivation: “Starting in 2007, taxpayers may receive a refundable credit for any used prior year minimum tax credit that has been carried forward from year 2003 or earlier. Taxpayers should get out any carryover worksheets they have or AMT tax forms from earlier years in order to prepare their 2007 returns.”
The AMT or Alternative Minimum Tax was devised to make sure people pay a minimum amount, since regular taxes could be reduced quite a bit. It uses a different calculation based on certain “trigger” occurrences. Some of these include: passive income or losses, itemized deductions for medical expenses, etc.
There is of course, the bad news. First of all, this one confuses me: It’s now a requirement to record and report all charitable donations, including their value. So if I want to go to Goodwill and give them 3 shirts, I have to report it. How will that affect my taxes? Why is that necessary for the taxpayers? In my opinion, this is a baby step to destroying the fundamentals of America. People could simply stop doing charitable things just to avoid the complications or effects they could have on their taxes.
Your mortgage insurance premiums may also be deductible depending on the provider but for 4 years only, ending in 2010. This could be quite beneficial and is good news considering the bad and decreasing state of the home market.
Unfortunately however, it seems like the rich are going to continue to get richer and the poorer will continue to get poorer. There are still some serious issues with the way America does taxes, thankfully retail tax is pretty low, but who doesn’t buy online nowadays?Finally I’ll run down some of the main expiring tax benefits which are a sad loss, as well as some of the top of the line tax software and preparers.
Expired tax benefits:
- Classroom expenses deduction
- Tuition and fees deduction
- Itemized deduction for sales tax
There are others as well you will find in the sources, so on to the software.
- TaxACT is highly recommended for people with relatively straightforward tax returns to prepare.
- Quick and easy tax preparation in an updated interface, TaxCut is ideal for simple tax returns, made by H&R Block.
- TurboTax is very quick and easy for simple tax returns. The software isn’t completely up to date with all the latest tax law changes, so TurboTax users should start to prepare their returns now, but wait until mid-February to make sure the software is completely updated.
Again, you’ll find the complete list in the sources. I won’t talk about finding a tax preparer since just like finding a person or product line to trust, you have to read all of the information and research and decide for yourself, so here are some resources I gathered:
God speed and Best wishes.