Tuesday, January 08, 2008

Taxpayers Should Prepare For the 2008 Filing Season

Advance Planning Can Save Time and Money

New York State Acting Commissioner of Taxation and Finance Barbara G. Billet today advised taxpayers that they can save time, effort and, in some cases, money, by preparing now for the upcoming tax filing season.

"The holiday season is behind us, and now we turn our attention to filing our personal income tax returns," Acting Commissioner Billet said. "Taxpayers who plan in advance can reduce the time needed to file returns, especially if they e-file, and avoid errors that may reduce tax refunds. Taxpayers who prepare in advance have a better chance of maximizing their tax savings."

Besides organizing records, receipts and other expenses, taxpayers should check copies of their 2006 tax returns against what they've earned in 2007 and anticipate deducting this year. Taxpayers with concerns should consult the Tax Department's website, www.nystax.gov, or contact the department's customer service representatives at 1-800-CALL-TAX (1-800-225-5829) for more information.

On the website, taxpayers can access information on how to obtain or download tax forms, determine whether they qualify for free online New York State tax preparation and e-filing, how to obtain Form W-2 (an individual's wage and tax statement), or who to contact regarding an outstanding tax liability. Tax filers can also consult the department's catalogue of Frequently Asked Questions (FAQs), which provides answers to questions regarding personal income tax, estate tax, gift and prize winnings, sales and use tax, child support enforcement, technical assistance and help with other tax-related matters.

There's also information available online or through the Call Center about the state's STAR school tax relief program for homeowners, tax help for individuals serving in and in support of the Iraq combat zone, how to find up-to-date changes to the state's individual and corporate tax forms, and how to check on the status of your refund online or by phone.

Taxpayers looking for detailed information about tuition tax credits or tax credits for homeowners or renters should log onto the department's website and click on Publications and Technical Bulletins. There they'll also get help on Earned Income Tax Credit qualifications, tax issues related to hiring domestic help, questions and answers on New York State's Farmer's School Tax Credit, and tax information for New York State Nonresident and Part-Year Resident tax filers. There are dozens of easy-to-read publications and technical bulletins that cover most concerns of both individual and business taxpayers.

Taxpayers should also be aware that they may benefit from changes made this year in the State Tax Law. Among those changes are:

*The New York City school tax credit has been increased for New York City residents with federal adjusted gross income (minus any IRA distributions) of $250,000 and less. If you are married filing jointly or a qualifying widow(er), the credit is increased to $290; for all others, the credit is $145.

*Full-year New York State residents who are active volunteer firefighters or volunteer ambulance workers for the entire tax year can claim a new $200 refundable credit.

*New York City residents can claim a new child and dependent care credit for tax years beginning on or after January 1, 2007, New York City full-year and part-year residents with federal adjusted gross income of $30,000 or less who paid child care expenses for children under the age of four may be eligible to claim a new refundable New York City child and dependent care credit. This credit may be claimed in addition to the New York State child and dependent care credit.
*There is a new subtraction modification from federal adjusted gross income for living organ donors. Full-year New York State residents who, while living, donate one or more human organs to another person for human organ transplantation can subtract unreimbursed expenses incurred by the donor, relating to their organ donation, for travel, lodging, and lost wages, up to a maximum of $10,000.
*A new historic homeownership rehabilitation credit is available for qualified rehabilitation expenditures paid or incurred for the rehabilitation of a qualified historic home located in New York State. The credit is equal to 20% of the qualified rehabilitation expenditures.
*Tenant-shareholders in cooperative housing corporations or condominium owners may now claim a percentage of the qualified expenditures for qualified solar energy system equipment purchased and installed by the cooperative housing corporation or the condominium management association.

"Resist the temptation to put off filing your taxes until the last minute," Acting Commissioner Billet said. "You can cut tax preparation time if you develop a system for organizing records and receipts, and by logging onto our website for instructions and more information. Check to see if you qualify for free e-filing. By starting now, taxpayers can avoid the stress and frustration of the mid-April tax rush."

The department also encourages taxpayers to use e-file in conjunction with direct deposit of any refund due in place of applying for the refund anticipation loans often offered by tax preparers. Refund anticipation loans carry hefty fees and interest that can reduce a large portion of any refund a taxpayer has coming.

No comments: