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This tax season, there were approximately 1,000 changes to the federal individual income tax code. Throw in almost 4,400 state changes and one can start to get a picture why going it alone could be a daunting task.
To ensure taxpayers receive all they can, H&R Block in Wellington (970-568-1206) is offering a free Second Look through April 30. This includes another look at 2012 tax returns and if desired, a review of the past three prior year returns. If properly claimed, commonly missed credits and deductions could result in thousands of dollars of additional money in the pockets of individual taxpayers.
“Taxes are complicated and even smart people miss things. The risk for taxpayers who do their own returns is the possibility of missing out on deductions or credits that can save thousands of dollars,” stated Shalee Osborn, regional marketing manager for H&R Block. “Even for those who have already filed their return, it’s not too late to have an H&R Block tax professional take another look. If we find you’ve missed something, we can amend and re-file your return and get you every penny you deserve.”
As the tax filing season approaches its mid-point, taxpayers should be aware of available tax credits and deductions and take a closer look at their 2012 return. Unfortunately, not all tax returns are prepared accurately which can lead to overpayment. Below are the top five missed and misunderstood tax breaks.
1. Higher Education –American Opportunity Credit worth up to $2,500, the Lifetime Learning Credit worth up to $2,000 and the Tuition and Fees Deduction which lowers taxable income up to $4,000.
2. Wrong filing status – For a single parent with two children earning $40,000, selecting single filing status instead of head of household, could cost them approximately $600.
3. Self-employed Schedule C – More than 25 million taxpayers file a Schedule C annually. However, these small business people often miss basic tax breaks they qualify for.
4. Dependent exemption – This tax break, often missed by filers in the sandwich generation and other multi-generational families, lowers taxable income by $3,800 per dependent.
5. Earned Income Tax Credit – Approximately 1 in 5 taxpayers who are eligible for this credit fail to claim it. The credit could be worth up to $5,891.
Additionally, each year, it’s estimated that almost a million taxpayers leave money on the table by not filing a tax return even though they qualify to receive a refund. The median total refund amount for this group is about $600. Taxpayers can still claim any money due from 2009 through 2011 by filing tax returns for those years and by being current on their prior year returns.
For current year returns, clients can access the expertise of H&R Block for a free Second Look review of their 2012 tax return either in one of approximately 11,000 tax offices or from the comfort of home via Block Live. H&R Block’s Second Look provides a professional review of the original tax return from the past three years and advice on what to do if variances are found. For a fee, H&R Block will file an amended or corrected return for the taxpayer.