Tax Forms

Simple Common Sense:

It really makes no difference since the only time you actually do WANT to file is when the IRS says you don't have to!

They don't do that because it's good for you. They do it because it is more likely to be good for them. Certainly if you don't have to file, NOTHING BAD, in fact only good things, can happen by doing so.

Federal Taxes are the same throughout the country. State tax laws are specific to each area.

Whether you have to file a tax return (or pay tax) depends, in part, on your filing status, deductions, amount & type of income. There are no such things as "start and stop" ages, not having to pay because of retirement or on social security or working from home or a student. It is all addressed as a matter of"how much TAXABLE income."

(Note: working isn't relevant either, as many people who don't work or are retired, or disabled, or old, or young, or in school, have income from many sources: savings, investments, etc. TAXABLE income is different than what you may otherwise think of as income. In most circumstances, you have to do many of the calculations needed to file a return, just to determine what taxable income may be).

Likewise, there are no special or fixed rates for retired, student, doctor, sanitation worker, President, convict...whatever. The amount of taxable income after applicable deductions and adjustments determines the rate applied to your particular situation. The rate, as well as the amount, you pay changes as the amount of income does.

You must file a tax return if you had net earnings from self-employment of $400 or more. This is your total self-employment income less the expenses paid in operating your trade or business, multiplied by 92.35%.

If you weren't self-employed (meaning paid on a 1099 or ran your own business) then you would always want to file a return to claim the amount withheld and shown on your W-2. Which with lower incomes will always be refunded to you.

If you are an individual who may be claimed as a dependent on another person's return, you are subject to specific filing requirements. Refer to the instructions in your tax package or refer to Publication 929, Tax Rules for Children and Dependents, or Publication 501, Exemptions, Standard Deduction, and Filing Information, for the filing requirements for dependents. All available at www.IRS.gov

You must file a tax return if you received any amount of advance earned income credit payments from your employer during the year, or if you owe any taxes, such as:

• social security tax and Medicare tax on tips or group life insurance,
• alternative minimum tax,
• tax on qualified retirement plans including an Individual Retirement Account, or other tax-favored account,
• tax from recapture of an education credit, investment credit, low income housing credit, federal mortgage subsidy, qualified electric vehicle credit, or the native American employment credit.

Generally, you must file a tax return if you are a nonresident alien with income from sources in the United States. For more information on nonresident aliens, select Topic 851 at the IRS website.

Even if you are not required to file a tax return, file a return BECAUSE MANY, LOW INCOME PEOPLE HAVE MANY BENEFITS COMING THAT ARE KEYED TO FILING A RETURN. (Like stimulus checks).

Also, the Statute of Limitations for when the IRS can no longer ask you questions about your affairs for a year only STARTS to run when a return is filed. Not filing, and they can bug you, (and assess a tax) for forever!

You can file for free at the www.irs.gov site too! See http://www.irs.gov/pub/irs-pdf/i1040ez.pdf

I think what you're asking is "How much will my refund be if I claim one child?" If this is the case, then really there are too many factors involved to give you a straight answer. Tax rates vary depending on how much money you make and also the number and amount of deductible expenses you claim. The amount of tax deducted from your paychecks represents what you paid for the year, and depends also on the number of deductions listed on your W-4 (on file with your employer). All of these factors can and will change the amount of potential tax you owe, or the amount of refund you can expect to get back at the end of the year. Even if you claim a child (or other dependent), it doesn't necessarily mean you'll get a refund. Remember, a tax return is really just a reconciliation between what you paid, and what you should have paid. If you owe more, then you underpaid during the year; if you get a refund, then you overpaid during the year.

Simplified, the tax you owe is calculated based on how much income you made minus certain expenses, or deductions. Basically the benefit to claiming children (or other dependents) is that the deduction reduces the total amount of taxable income so you owe less tax. However, if you already allowed for the child in the number of deductions on your W-4, then you may have already paid close to the correct amount. When you file your tax return, you may still owe a little, break even, or get a small refund.

There are many qualified tax filers that will assist you in filing individual returns for a small fee. If you have any questions or concerns about your personal situation, then seek advice early. The tax deadline for filing in 2010 is Thursday, April 15.

To report the unemployment compensation that you received during the year 2009 you should get a 1099-G from the state with the information that will use to report your unemployment compensation on the 1040 tax form when you have all of your other worldwide gross income tax information.

The gross amount received less the first 2400 of income tax free amount would be the taxable amount that would be reported as taxable income on your 1040 tax form.

Go to www.irs.gov and type FREE FILE

Free File is the fast, easy, and free way to prepare and e-file your federal taxes online.

After completing the income tax return print a copy of the completed tax return before transmitting it.

Then wait a day or to check and see if you have received acknowledgment from the IRS that they have accepted your income tax return as it was filed.

Print a copy of any form that you have from the IRS about the tax return as you may need it for future reference.

After the end of the year 2009 and you have all of the information forms W-2, 1099s, and any other information forms concerning all of your worldwide income from all sources in your hand. Usually this information is received beginning in January and can go through the end of January and some is not received until later in the year usually before the April 15 deadline for the filing of your income tax return.

2010 IRS e-file Refund Cycle Chart Direct Deposit sent Paper Check Mailed

Transmitted and accepted by (11:00 am)

between Jan 15 and Jan 21, 2010 Jan 29, 2010 Feb 5, 2010

You must make sure that you receive your acknowledgment from the IRS that they have accepted your income tax return as you filed it. You usually will receive the acknowledgment in a day or 2.

The IRS does not guarantee a specific date that a refund will be deposited into a taxpayer's financial institution account or mailed. Taxpayers who e-filed can get refund information 72 hours after the electronic return data is acknowledged as accepted by the IRS. To check the status of a refund go to www.irs.gov and click on Where's My Refund?

Yes it is possible that you would be required to or want to file an income tax return for the tax year 2009. Go to www.irs.gov and use the search box for Do You Need to File a Federal Income Tax Return?

Many people will file a 2009 Federal income tax return even though the income on the return was below the filing requirement. The questions below will help you determine if you need to file a Federal Income Tax return or if you need to stop your withholding so you will not have to file an unnecessary return in the future.

The Internal Revenue Service is providing this information as a part of our customer service and outreach efforts to Reduce Taxpayer Burden and Processing Costs. Changing your withholding and/or not filing Unnecessary Returns will save both you and the government time and money.

Even if you do not have to file a return, you should file one to get a refund of any Federal Income Tax withheld.

To determine if you need to file a Federal Income Tax return for 2009 answer the following questions:

Yes if all of the rules are met for this purpose.

Publication 970 Tax Benefits for Education

http://www.irs.gov/publications/p970/index.html

What Expenses Qualify

Here are the top nine things the Internal Revenue Service wants you to know about this valuable credit and how you can benefit from it when you file your 2009 taxes.

1. The credit can be claimed for tuition and certain fees paid for higher education in 2009 and 2010.
2. The American Opportunity Credit can be claimed for expenses paid for any of the first four years of post-secondary education.
3. The credit is worth up to $2,500 and is based on a percentage of the cost of qualified tuition and related expenses paid during the taxable year for each eligible student. This is a $700 increase from the Hope Credit.
4. The term "qualified tuition and related expenses" has been expanded to include expenditures for required course materials. For this purpose, the term "course materials" means books, supplies and equipment required for a course of study.
5. Taxpayers will receive a tax credit based on 100 percent of the first $2,000 of tuition, fees and course materials paid during the taxable year, plus 25 percent of the next $2,000 of tuition, fees and course materials paid during the taxable year.
6. Forty percent of the credit is refundable, so even those who owe no tax can get up to $1,000 of the credit for each eligible student as cash back.
7. To be eligible for the full credit, your modified adjusted gross income must be $80,000 or less -- $160,000 or less for joint filers.
8. The credit begins to decrease for individuals with incomes above $80,000 or $160,000 for joint filers and is not available for individuals who make more than $90,000 or $180,000 for joint filers.
9. The credit is claimed using Form 8863, Education Credits, (American Opportunity, Hope, and Lifetime Learning Credits), and is attached to Form 1040 or 1040A.

For more information about the American Opportunity Tax Credit visit the IRS Web site at IRS.gov/recovery.

Links

• The American Recovery and Reinvestment Act of 2009: Information Center
• American Opportunity Credit
• Form 8863, Education Credits