Find new deductions at tax time

February 8, 2010 4:39:48 PM PST
It's time to break out the pencils and fire up the calculator. After all, your 2009 taxes will not prepare themselves. This year there are several deductions that can make your return even larger. A lot of tax filers may qualify for a tax credit they never got before and there are extra deductions for home buyers and charitable contributions that can add to your refund.

The rush is on at the Houston Internal Revenue Service office. Tax payers like Alexandra Reed are grabbing forms, but they may be missing valuable deductions like the Earned Income Tax Credit, a deduction many may qualify for but few have heard about.

"No. Honestly I don't, I really don't," said Reed.

The Earned Income Tax Credit is for anyone making less than $50,000 a year and is designed to help low-income working families. This year more may be eligible for it.

"This year we recognize that some people may have lost their jobs last year and they may qualify for it this year, the EITC, and may not know about it," said Lea Crusberg of the IRS.

The IRS will offer free tax help for those who qualify for the EITC, but there are even more deductions to consider, like deducting sales tax paid on a new car purchase and that big home buyer deduction.

"Both dollar-wise and complexity-wise, the homebuyer tax credit is one of the biggest items this year. There have been three different versions of it and so most people will need some help sorting through it," said Bob Martin, CPA.

First-time homebuyers can get an $8,000 deduction and current homeowners can get $6,500 in deductions on their 2009 taxes if they close on a house before the end of April.

If you donated to Haiti, don't forget to add that, too.

"It is possible to get a 2009 tax deduction for money you paid for Haiti relief in 2010," said Martin.

The IRS is offering free tax help on Saturday, February 20.

To find out if you quality for the Earned Income Tax Credit, click on the link here.