This post is the seventh in a series of weekly posts containing tax information and filing tips. Check back next week for our next post, or click here to read past posts.
Tax Day is right around the corner! If you haven’t filed your taxes yet, here are the top 8 things you should know before April 15.
1. You may be eligible to have your taxes done for free.
If you make less than $51,000 a year, you may be eligible to have your taxes filed for free through an IRS-sponsored Volunteer Income Tax Assistance (VITA) sites. http://www.irs.gov/Individuals/Free-Tax-Return-Preparation-for-You-by-Volunteers
If you are over age 59, you may also be eligible, even if you earn a moderate income. The IRS-sponsored Tax Counseling for the Elderly (TCE) and the AARP-sponsored Tax-Aide sites both offer free tax services to individuals 60 years of age or older. For more information, check out this article.
2. Where to find a free tax service preparation center near you.
To find out where you can go to get free help with your taxes at IRS sponsored sites, go to http://irs.treasury.gov/freetaxprep/ or call the IRS toll-free at (800) 906-9887. This website will also tell you if the site needs an appointment or accepts walk-ins, so you can plan your visit.
For Tax-Aide sites, go to: www.aarp.org/money/taxes/aarp_taxaide/ or call 1-888-OUR-AARP.
3. What you should bring to your tax appointment
Here is a list of documents you will need to bring to a VITA/TCE/ Tax-Aide site.
4. What federal credits you should ask about
There are a variety of possible federal and state credits and deductions and every tax return is different. But low- to moderate-income families should know about a few important federal credits intended to give them a boost. The Child and Dependent Care Tax Credit can be worth up to $2,100, the Child Tax Credit is worth up to $1,000 per child, and the Earned Income Tax Credit can be worth up to $5,891 – and the latter two credits are available as refunds to families with no income tax liability. To learn more about these federal credits for families, check out these NWLC fact sheets.
5. What state credits you should ask about
In addition to the federal credits for families, many states offer their own versions. Different states have different tax credits available. Check out our map to find tax credit information specific to your state.
6. What you should watch out for
Unfortunately, some people use tax filing season as an opportunity to scam others out of their money or identity secrets.
Do NOT give your Social Security Number or bank account information over the phone, email, or to people that come to your house claiming to be from the IRS! Neither VITA sites nor the IRS will EVER ask for that information by email or over the phone and the IRS does NOT send representatives door-to-door.
For other helpful tips of things you should avoid this tax season, read this post.
7. Tax credit refunds for low-income families do not count as income.
Tax credit refunds received by low-income families do not count toward income when determining that family’s eligibility for federally funded programs, like TANF, SNAP, or SSI. And even if you put some of your tax refund into savings, it will not affect your family’s ability to claim these benefits for a 12-month period. For more information, take a look at the slides from this webinar.
8. You can file taxes and claim tax credits for the last three years.
April 15 is the filing deadline for the 2012 tax year, but you can also file returns for the 2009, 2010 and 2011 tax years as well. The IRS has millions of dollars in unclaimed refunds. Families who did not file returns for those years may be eligible for refunds – and even if families filed returns for those years, but failed to claim credits for which they were eligible, it might be worth filing an amended return. And there is no penalty for filing a late return that qualifies for a refund! Check out this article for more information: http://www.irs.gov/uac/Newsroom/IRS-Has-$917-Million-for-People-Who-Have-Not-Filed-a-2009-Income-Tax-Return. But the best bet is to bring all of your documents and discuss it with a VITA tax preparer or other tax professional.