New Tax Breaks, Bigger Refunds: Things You Need to Know

New Tax Breaks, Bigger Refunds: Things You Need to Know

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IRS sending bigger refund checksA handful of changes in the tax code could translate into a fatter refund check in 2011, thanks to the Small Business Jobs Act, passed in September and the historic health care reform law, passed in March. These laws offer hefty credits and deductions for capital investments and employee health insurance costs.

There are a number of other new things that taxpayers should remember. This year, they will have until Monday, April 18 to file their tax returns and pay any tax due. Emancipation Day, a holiday observed in the District of Columbia, falls this year on Friday, April 15. D.C. holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have three extra days to file this year.

This is also the first filing season that tax packages will not be mailed to individuals or businesses. There are still many options for taxpayers to get paper forms and instructions if they need them. In recent years, fewer and fewer taxpayers received these mailings. Last year, only 8 percent of individuals who filed tax returns received tax packages in the mail. Taxpayers can still get any forms and instructions they need online at www.IRS.gov, or they can visit local IRS offices or participating libraries and post offices.

In addition, individuals making $49,000 or less can use the Volunteer Income Tax Assistance program for free tax preparation and, in many cases, free electronic filing. Individuals age 60 and older can take advantage of free tax counseling and basic income tax preparation through Tax Counseling for the Elderly.

IRS Free File provides options for free brand-name tax software or online fillable forms plus free electronic filing. Everyone can use Free File to prepare a federal tax return. Taxpayers who make $58,000 or less can choose from approximately 20 commercial software providers. There’s no income limit for Free File Fillable Forms, the electronic version of IRS paper forms, which also includes free e-filing.

The IRS also reminds tax professionals preparing returns for a fee that this is the first year that they must have a Preparer Tax Identification Number. 

Taxpayers with questions should check the IRS website at www.IRS.gov, or call the toll-free number or visit a taxpayer assistance center.

If you own a business, CNN has chosen the top six new credits and deductions likely to affect the most small business owners. (READ the article at CNN-Money here.)

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