It is that time of year again: Tax Season. If you have not already, shortly you will start to receive your 1099’s, W-2’s and other financial documents needed to prepare your tax returns.
But this year, more so than in prior years, you may benefit from reviewing not only your basic tax forms, but other financial data as well.
The American Recovery and Reinvestment Act of 2009 created a number of tax credits and deductions for individuals that should be kept in mind when preparing your returns. For example, you have probably heard that first time home buyers are eligible for a tax credit. But don’t forget that home buyers who are replacing a principal residence in which they lived for five out of the last eight years are also eligible for a credit. It is also worth reviewing the definition of “first time homebuyer” since your prior homeownership may not disqualify you from claiming this tax credit for your recent home purchase.
You may not have qualified for the “Cash For Clunkers” program, but if you purchased a new car in 2009, you may qualify for a deduction.
For more specific information, it is worth visiting the IRS’s site at http://www.irs.gov/newsroom/article/0,,id=204335,00.html
For some creative thinking on the topic, I would suggest Katie Adams’ column at http://www.msnbc.msn.com/id/34848380/ns/business-personal_finance/
Obviously, you should review all of your deductions and credits with a tax professional, but as we approach that most wonderful time of the year (do you sense my sarcasm?), it would be a shame to overlook the new credits and deductions.