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Tips on deductions or to save you time.
1. File online for free. No matter what your income, you can file your incom tax returns online at IRS Web site at www.irs.gov for FREE. If you are getting a refund it will be much faster to file online than by mail.
2. You can file for an income tax extension if you are not ready with your taxes by April 15, however it does not mean you get to delay your tax payment. Make sure if you are going to owe to pay the amount by April even if you won't file your taxes for a few months due to the extension. To estimate you can check last years taxes but make sure to account for major life changes that might have affected the amount you owe this year.
3. Use the standard deductions if you don't pay interest on mortgage or have charitable deductions, it is fast and easy. For 2009 returns, the standard deduction for single individuals is $5,700; for married couples, it's $11,400. Additional standard deductions apply for those over age 65 and the blind.
4. Don't forget the new real estate tax deduction. There's a new standard tax deduction for homeowners. They can add a standard deduction of up to $1,000 if they pay real estate taxes. And first-time home buyers in 2009 may be eligible for a tax credit of up to $8,000.
5. Job-hunting expenses are deductible. If you were laid off in the past year, most of the expenses incurred while looking for a job can be deducted from your taxes. You can deduct expenditures for career coaches and headhunters or preparing and copying your resume. You can even deduct long distance or cell phone charges related to the job search, as well as travel expenses incurred for interviews, including mileage.
6. If you paid for children's college tuition in 2009 you can deduct up to $4,000; teachers who paid for books or other classroom supplies can deduct up to $250. If you bought a hybrid vehicle, you're eligible for a conservation tax credit of between $250 and $1,000. Depending on the make of your new car, you could also get a fuel economy credit of $400 to $2,400.
7. Add to your retirement savings . IRS allows you to designate accounts to transfer your refund to. You can opt to have part or all of your refund transferred to your Individual Retirement Account (IRA).
8. Take advantage of a tax payment plan. There is a payment plan option, but it comes with several strings: You may qualify if your tax bill is less than $25,000 and can be paid off within five years.
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