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Don’t Be Overconfident At Tax Time and suffer

Not taking advantage of all the tax credits, deductions, and exemptions legitimately available to you at tax time is the same as cheating yourself.

Let’s take a look at some of the things you will need to know about for your 2009 taxes

There is a first time homebuyer tax credit.  It is important to know that the Internal Revenue Service defines a first time homebuyer as someone who has not owned a principal residence for three years before the purchase of the new home.  Of course, you must also buy the house within calendar year 2009.

If you make an energy conserving improvement to your home in 2009, you can get a tax credit.  You can take advantage of the Energy Conservation Credit and receive up to a $1500 tax credit.  However, you must apply that credit to your 2009 and 2010 taxes.  So it is only good for $750 each of those years.

You can receive a tax credit for the purchase of hybrid automobiles. The American Recovery and Reinvestment Act along with the Emergency Economic Stabilization Act make it possible for you to get credits depending upon the propulsion, height, and weight of a hybrid vehicle

Be certain to research whether you qualify for a child-care credit.  Many parents face high costs regarding childcare for their children.  Childcare credits are designed to help offset these costs.  Even if you are in a reimbursement program, you could still qualify.  Check this credit out in detail in order to determine if it is applicable to your situation.

The expenses of job hunting can be deducted from your taxes.  If you have found yourself searching for employment, you can deduct those expenses.  Also, if you have to relocate more than fifty miles away for a job, you can deduct moving expenses.

Everyone receives a deduction for health insurance payments.  If, however, you are self-employed, you can deduct one hundred percent of your health insurance costs.

Non-monetary gifts to charities are tax deductible.  If you give clothing, furnishings, household goods, or any kind of material possession to charity, ask for a receipt.  These non-monetary donations are tax deductible.

The cost of filing your income tax return is tax deductible.  This is a commonly missed deduction.  The deductions will be for last year’s return, so save any cost documentation from a tax professional who filed your returns, electronic filing costs, or software expenses.

There are even more tax breaks and strategic tax advantages that you should discuss with a tax professional in order to be certain that you are getting the lowest tax liability possible for your circumstances.

About the Author

Chintamani Abhyankar, is a well known expert in the field of finance and taxation for last 25 years. His famous Tax eBook “Stop donating your money to IRS” which is now running in its second edition, provides intricate knowledge and valuable tips on personal finance and income tax. Just visit his website http://www.planningyourtax.com/ and claim your FREE eBook.