Here are some important facts about filing your 2006 income tax return.
February 1, 2007 (Press Release) --
Some important facts about filing your 2006 income tax return:
FILING DEADLINE:
April 17, 2007. The usual deadline, April 15, is on a Sunday, and the next day, April 16, is Emancipation Day in the District of Columbia, a legal holiday under a new city law. Although it's not a federal holiday -- and the IRS will be open that day -- the agency has extended the tax filing deadline to April 17 because of a federal statute that says District of Columbia holidays have a nationwide impact. This change came too late to be reflected in IRS forms and publications for the 2006 tax year, which had already been printed.
FILING EXTENSION:
Automatic six-month extension to Oct. 15, as long as Form 4868 is filed by the April deadline.
WHAT'S NEW:
--For taxpayers who itemize, there are stricter rules for charitable deductions of household goods. Items donated after Aug. 17, 2006, must be in "good used condition or better" to qualify for the deduction.
--Inflation-related increases for: personal and dependent exemptions, standard deductions, thresholds at which certain tax benefits begin to phase out, maximum income for claiming earned income credit, slight increase in income threshold for phase-out of deduction for IRA contributions by joint filers already covered by a retirement plan at work.
--Age at which teens are subject to the "kiddie" tax on investment income is raised to under 18; it had been under 14.
--Telephone tax rebate: Taxpayers can claim a standard refund of $30 to $60, depending on the number of exemptions checked on the tax return. (If you have records of actual taxes paid for service billed between March 2003 and July 2006, you may claim that amount; file Form 8913.)
Even if you aren't required to file a tax return -- perhaps your income was too low -- you can still get the refund. There's a new form, 1040 EZ-T, for this purpose.
EXTENDED TAX BREAKS:
Several popular tax breaks that expired at the end of 2005 were restored by Congress in its final days last year. Among them: a deduction of up to $4,000 for qualifying higher education tuition and fees, and a deduction of up to $250 for teachers who pay for school supplies with their own money.
Also extended was the deduction for state and local sales taxes, which primarily benefits people living in states where there is no state income tax.
ENERGY CREDITS:
Available for certain energy-saving home improvements and for hybrid and alternative fuel vehicles.
FREE E-FILING:
The IRS' Free File Alliance with tax software companies allows taxpayers with incomes of $52,000 or less to prepare and file returns online for free if they access the program through the IRS Web site at http://www.irs.gov.
REFUNDS:
For the first time, the IRS will split a taxpayer's refund into three different financial accounts, such as checking, savings and retirement accounts if asked; file Form 8888.
It should take no more than two weeks to receive a refund from a tax return filed electronically, no more than eight weeks for a paper-filed return for which the filer is receiving a paper check from the government.
To check refund status go to the IRS Web site and click on the "Where's My Refund?" link on the left. When prompted, enter your Social Security Number, filing status and exact amount of the refund shown on your 2006 tax return. Or, call the refund hotline at 1-800-829-1954.
IRS FORMS/PUBLICATIONS:
Download these at http://www.irs.gov by going to "Forms and Publications" -- or order by mail by calling 1-800-829-3676.
ONLINE TAX HELP:
http://www.irs.gov. This is a robust Web site with links to every tax topic. There are interactive tools for calculating withholding and earned income credit, along with interactive history lessons, games and "Tax Trivia."
PHONE TAX HELP:
1-800-829-1040 for individuals, 1-800-829-4059 (TDD) for those with hearing impairment, 1-800-829-4933 for businesses.
However, it can take time to get through. To reduce the time taxpayers wait to speak to IRS representatives, the agency blocked more calls in 2006 than it did in 2005. The result was that more callers waited less time to speak with a representative, but more taxpayers were disconnected, according to a report to Congress last year by the Treasury Department inspector general for tax administration.
Source: http://biz.yahoo.com/
FILING DEADLINE:
April 17, 2007. The usual deadline, April 15, is on a Sunday, and the next day, April 16, is Emancipation Day in the District of Columbia, a legal holiday under a new city law. Although it's not a federal holiday -- and the IRS will be open that day -- the agency has extended the tax filing deadline to April 17 because of a federal statute that says District of Columbia holidays have a nationwide impact. This change came too late to be reflected in IRS forms and publications for the 2006 tax year, which had already been printed.
FILING EXTENSION:
Automatic six-month extension to Oct. 15, as long as Form 4868 is filed by the April deadline.
WHAT'S NEW:
--For taxpayers who itemize, there are stricter rules for charitable deductions of household goods. Items donated after Aug. 17, 2006, must be in "good used condition or better" to qualify for the deduction.
--Inflation-related increases for: personal and dependent exemptions, standard deductions, thresholds at which certain tax benefits begin to phase out, maximum income for claiming earned income credit, slight increase in income threshold for phase-out of deduction for IRA contributions by joint filers already covered by a retirement plan at work.
--Age at which teens are subject to the "kiddie" tax on investment income is raised to under 18; it had been under 14.
--Telephone tax rebate: Taxpayers can claim a standard refund of $30 to $60, depending on the number of exemptions checked on the tax return. (If you have records of actual taxes paid for service billed between March 2003 and July 2006, you may claim that amount; file Form 8913.)
Even if you aren't required to file a tax return -- perhaps your income was too low -- you can still get the refund. There's a new form, 1040 EZ-T, for this purpose.
EXTENDED TAX BREAKS:
Several popular tax breaks that expired at the end of 2005 were restored by Congress in its final days last year. Among them: a deduction of up to $4,000 for qualifying higher education tuition and fees, and a deduction of up to $250 for teachers who pay for school supplies with their own money.
Also extended was the deduction for state and local sales taxes, which primarily benefits people living in states where there is no state income tax.
ENERGY CREDITS:
Available for certain energy-saving home improvements and for hybrid and alternative fuel vehicles.
FREE E-FILING:
The IRS' Free File Alliance with tax software companies allows taxpayers with incomes of $52,000 or less to prepare and file returns online for free if they access the program through the IRS Web site at http://www.irs.gov.
REFUNDS:
For the first time, the IRS will split a taxpayer's refund into three different financial accounts, such as checking, savings and retirement accounts if asked; file Form 8888.
It should take no more than two weeks to receive a refund from a tax return filed electronically, no more than eight weeks for a paper-filed return for which the filer is receiving a paper check from the government.
To check refund status go to the IRS Web site and click on the "Where's My Refund?" link on the left. When prompted, enter your Social Security Number, filing status and exact amount of the refund shown on your 2006 tax return. Or, call the refund hotline at 1-800-829-1954.
IRS FORMS/PUBLICATIONS:
Download these at http://www.irs.gov by going to "Forms and Publications" -- or order by mail by calling 1-800-829-3676.
ONLINE TAX HELP:
http://www.irs.gov. This is a robust Web site with links to every tax topic. There are interactive tools for calculating withholding and earned income credit, along with interactive history lessons, games and "Tax Trivia."
PHONE TAX HELP:
1-800-829-1040 for individuals, 1-800-829-4059 (TDD) for those with hearing impairment, 1-800-829-4933 for businesses.
However, it can take time to get through. To reduce the time taxpayers wait to speak to IRS representatives, the agency blocked more calls in 2006 than it did in 2005. The result was that more callers waited less time to speak with a representative, but more taxpayers were disconnected, according to a report to Congress last year by the Treasury Department inspector general for tax administration.
Source: http://biz.yahoo.com/
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