SpringfieldNewsSun.com

Springfield, Ohio — With Christmas memories still fresh and New Year's Day almost here, the last thing many people are thinking about is filing a 2008 federal income tax return.

But taking time before the end of the year to organize and plan can save time and money.

Here are preparation suggestions from the Internal Revenue Service:

• Gather tax records now to reduce stress later.

Begin organizing records, including those relating to a home purchase or sale, stock transactions, IRAs, business or rental property and charitable donations.

• Estimate 2008 tax bill.

To ensure taxpayers don't have too much or too little tax withheld, the IRS offers a withholding calculator at irs.gov.

• Check eligibility for first-time homebuyer credit.

This new tax credit applies to home purchases after April 8, 2008, and before July 1, 2009. Even though it reduces a taxpayer's tax bill or increases a refund, be aware the credit must be repaid over 15 years.

• Claim the rebate recovery credit if no stimulus payment was received.

Taxpayers who missed the 2008 filing deadline can receive their payment in 2009 by filing an income tax return beginning in January and claiming the rebate recovery credit.

• Receive a missing refund.

If you believe you are missing a tax refund, access "Where's my Refund?" on irs.gov or call (800) 829-1954. Many times, an updated address is all the IRS needs to send a check.

• Research eligibility for the earned income tax credit.

The EITC is available to low- and moderate-income workers. The EITC Assistant at irs.gov can help determine eligibility.

• File an electronic return.

E-file is safe and offers more payment options. Direct deposits with e-filing can be in a taxpayer's bank account in as little as 10 days.

• Be sure to file properly with regard to unemployment compensation.

Unemployment compensation is taxable. You can have federal income tax withheld by filing Form W-4V.

• Gather tax information about home foreclosures.

Under the Mortgage Forgiveness Debt Relief Act of 2007, taxpayers usually can exclude income from the discharge of debt on their principal residence. With certain exceptions, this provision applies to debt forgiven in 2007, 2008 or 2009.

• Maximize contributions to retirement accounts.

This year, contribution limits are $5,000 in an IRA and $15,500 in a 401(k) employer plan. The limits go up to $6,000 and $20,500, respectively, for taxpayers 50 and older.

Contact this reporter at (937) 328-0371 or elroberts@coxohio.com.