Looking for tax tips in small doses? The IRS counts down to April 15 with a daily tax tip posted on their website.

Recent tips that caught my eye included:

• Ten Things You May Not Know About the Earned Income Tax Credit
• Tips for Recently Married or Divorced Taxpayers
• Top Five Facts about Dependents and Exemptions

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Posted February 2, 2009 in Taxes | Comments?

Children who earn investment income, including interest and dividends, usually pay a lower tax rate than their parents.

However, once the child’s investment income exceeds $1,800, the child’s income will be subject to the kiddie tax. When the kiddie tax applies, part of the child’s income will be taxed at the parent’s tax rate.

The kiddie tax used to apply to children under age 14. In 2006, Congress expanded it to include children under age 18. In 2008, the kiddie tax includes children under age 19, and dependent, full-time students under age 24.

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Posted January 29, 2009 in Taxes | Comments?

The Saver’s Credit (which used to be called the Retirement Savings Contributions Credit), is a tax credit up to $1,000 ($2,000 if filing jointly). The credit is for contributions to 401ks, IRAs, and other retirement plans.

Who can claim the Saver’s Credit:

• Individuals (and married filing separately) with incomes up to $26,500 in 2008 ($27,750 in 2009).
• Married couples filing jointly with incomes up to $53,000 in 2008 ($55,500 in 2009).
• Head of households with income up to $39,750 in 2008 ($41,625 in 2009).

Eligibility guidelines:

• You must be at least 18 years old.
• You cannot be a full-time student.
• You cannot be claimed as a dependent on another person’s return.

The credit is in addition to other tax benefits you receive from contributions, like tax deferrals on 401, and deductions on IRA contributions.

The credit, which is a percentage of the contribution ranging from 10% to 50% decreases as your income increases. It can be figured using Form 8880.

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Posted January 28, 2009 in Tax Deductions & Credits | Comments?

Tax dates for your calendar! Here are the important tax dates to remember in 2009:

• January 15, 2009: Fourth quarter estimated tax payment due (or you can file your return and pay all tax due by February 2, 2009).
• January 31, 2009: Last day for businesses to mail W-2, 1098, and 1099 forms.
• March 16, 2009: Corporate tax returns due.
• April 15, 2009: Individual tax returns or extensions due, first quarter estimated tax payments due, and IRA contribution deadline.
• June 15, 2009: Second quarter estimated taxes due.
• September 15, 2009: Third quarter estimated taxes due.
• October 15, 2009: Individual tax returns with extensions due.
• January 15, 2010: Fourth quarter estimated taxes due.

For more 2009 tax dates, see IRS Publication 509.

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Posted January 26, 2009 in Tax News | Comments?

Welcome to Tax Gab. From tax filing to tax software; from deductions and credits to tax news… it’s the place to be to talk tax!

There are so many tax rules for both personal taxes and business taxes from the IRS, sometimes it helps to talk it through before it makes sense.

While the focus will be on tax, I’ll also include a variety of finance topics that relate to taxes.

Welcome to Tax Gab!

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Posted January 26, 2009 in News | Comments?