Tax Tips 

Tax basics
In 2009, tax credits available include those for first-time homebuyers, undergraduate students. Taxpayers may take advantage of many other breaks that increase the chances of getting a tax refund or owing money.

Tax breaks for homeowners
If you purchased a home in 2009 or early 2010, you may be eligible to claim the First-Time Homebuyer Credit, whether you are a first-time homebuyer or a long-time resident purchasing a new home. In addition to this temporary credit, there are many existing tax deductions associated with home ownership.

Retirement strategies
Tax-advantaged retirement plans can help you lower your current tax bill and save for retirement. Recent legislation makes permanent higher IRA and 401(k) contribution limits.

Child and education-related tax credits
The new American Opportunity Credit is available for the first four years of college or other post-secondary school. If you pay for childcare or someone to look after an incapacitated dependent of any age, credits are also available.

Tax considerations for investors
If you have investments, it it important to know the maximum tax rate on your net long-term capital gains. Net capital losses are fully deductible against capital gains

Other recent tax law changes
Before starting on your 2009 tax return, you should be aware of the changes that may impact your return. The making work pay credit, economic recovery payments, COBRA premium assistanace and the AMT patch may help you lower your tax bill this year.

Common deductions
A tax deduction differs from a tax credit, which is applied directly to your tax bill, reducing it dollar for dollar. Deductions reduce the amount that is taxable. You can get tax deductions for such things as charitable contributions, student loan interest, mortgage interest and more.