|
Welcome to the Monmouth College VITA
homepage!
Puzzled by the tax law or
which credits and deductions to take?
Need assistance with your tax return at
no cost to you?
Volunteer Income Tax
Assistance (VITA) is an IRS program designed
to assist low income taxpayers ($50,000 and
below) file their tax returns.
Volunteers are Monmouth College
students that have been trained and certified
by the IRS to prepare tax returns.
They can help you with special credits,
such as the Earned Income Tax Credit (EITC),
the Child Tax Credit, education credits such
as the Hope and Lifetime Learning Credits, and
the Credit for the Elderly.
In addition to free tax
return preparation assistance, we offer free
electronic filing.
You can expect refunds in half the time
compared to returns filed on paper – even
faster if you have your refund deposited
directly into your bank account.
The service is provided on a
first-come, first served basis and your
returns are prepared while you wait.
What’s New for the 2009 Federal Tax Return?
·
Exemption Amount
Increased
The amount you can deduct
for each personal and dependency exemption has
increased from $3,500 in 2008 to $3,650 in
2009.
·
Standard Deduction Amount Increased
The standard deduction for
taxpayers who do not itemize deductions on
Schedule A of Form 1040 is higher for 2009
than it was for 2008.
The amount depends on your filing
status, whether you are 65 or older or blind,
and whether an exemption can be claimed for
you by another taxpayer.
The basic standard deduction amounts
for 2009 are:
Head of household -- $8,350
Married taxpayers filing jointly and
qualifying widow(er)s -- $11,400
Married taxpayers filing separately -- $5,700
Single -- $5,700
The standard deduction
amount for an individual who may be claimed as
a dependent by another taxpayer is the smaller
of the taxpayer’s normal standard deduction
(per filing status) or the sum of $300 and the
individual’s earned income, but not lower than
$950.
The standard deduction may
be increased for taxpayers not itemizing who
have real estate taxes and sales tax on new
qualified vehicle purchases.
The new Schedule L form is used to
calculate the standard deduction when these
items exist.
·
Making Work Pay Credit
A refundable tax credit for
working individuals (up to $400 for
single/$800 for married – it is calculated at
6.2% of earned income).
Taxpayers should have felt the effect
of this credit by reduced withholdings on
their paychecks.
This credit will be calculated on a new
Schedule M form attached to the return.
·
Economic Recovery Payment
In 2009 most social security
recipients and certain government retirees who
receive a pension from work and are not
covered by social security received a $250
payment.
This payment reduces the Making Work
Pay Credit.
·
Up to $2,400 unemployment compensation not
taxable
Taxpayers need to still
report all of their unemployment income, but
$2,400 will not be taxed.
·
Expanded Hope Credit (an education credit),
now called the American Opportunity Tax Credit
It is available for four
years of post-secondary education rather than
two.
The maximum amount of credit is
increased to $2,500 and adds required course
materials to the list of qualifying expenses
(in addition to tuition and fees).
In addition, 40% of this credit may be
refundable, meaning that if the taxpayer does
not have a tax liability, a refund is still
possible.
·
First Time Homebuyer Credit
For homes purchased after
December 31, 2008, through April 30, 2010,
taxpayers can qualify for a refundable credit
of 10% of the purchase price up to $8,000
($4,000 if Married Filing Separately).
Generally, the credit for qualifying
home purchases do not have to be repaid, as
long as the home remains the taxpayer’s main
home for 36 months after the purchase date.
If a buyer enters into a binding
contract by April 30, 2010, the buyer has
until June 30, 2010, to settle on the
purchase.
For those claiming this credit, a copy
of the binding contract/settlement statement
must be attached to the return, and must be
paper filed.
·
Definition of Qualifying Child Revised
To be a qualifying child,
the child must be younger than the taxpayer,
unless the child is permanently and totally
disabled.
If the parents of a child can claim the
child as a qualifying child but neither parent
claims the child, no one else can claim the
child as a qualifying child unless that
person’s AGI is higher than the highest AGI of
any parent of the child.
A taxpayer’s child is a qualifying
child for purposes of the child tax credit
only if the taxpayer can and does claim an
exception for the child.
·
New Rules for Children of Divorced or
Separated Parents
A new rule applies to the
noncustodial parent in situations where a
couple is divorced or legally separated after
2008.
To claim a child as a dependent, the
noncustodial parent must attach Form 8332 to
his or her tax return, rather than certain
pages from the divorce decree or separation
agreement.
For pre-2009 divorces and separations,
the noncustodial spouse still has the option
of attaching those pages.
·
Expanded Earned Income
Credit benefits are now available for those
with three or more qualifying children and
married couples.
·
There are two
nonrefundable home energy tax credits
available for those taxpayers that weatherize
their home
Examples include
high-efficiency heating and air conditioning
systems, water heaters and stoves that burn
biomass, energy-efficient windows and
skylights and doors, qualifying insulation and
certain roofs, solar electric systems, solar
hot water heaters, geothermal heat pumps, wind
turbines, and fuel cell property.
The manufacturer’s statement on these
items will indicate if they qualify and should
be kept for documentation.
For the Illinois return,
if taxpayers are going to claim the property
tax credit on their main home, their property
tax index number must be indicated on the
return.
Please note:
The information covered on our web site is not
intended as tax advice nor should it be
construed as tax advice.
Monmouth College volunteers are not professional
tax advisors and cannot give tax advice.
For tax advice assistance, contact a
professional tax advisor.
|
