Ohioans could lose $30.2 M in tax refunds
Refunds totaling more than $30.2 million may be waiting for 33,200 Ohio residents who did not file a federal income tax return for 2007, the Internal Revenue Service said. Ohioans filing back taxes for 2007 can receive an average potential refund of $620. This is the last year to file a federal tax return for 2007.
U.S. Sen. Sherrod Brown, D-Ohio, on Thursday introduced new legislation to help more middle-class and low-income Ohioans claim tax breaks such as the Earned Income Tax Credit and the Child Tax Credit. The bill would support Volunteer Income Tax Assistance programs, which offer free tax help to low-to-moderate income individuals who can’t afford professional assistance.
“With Tax Day upon us — and with our economy in a slow but steady rebound — we should do all we can to ensure that more eligible Ohioans can file for money-saving tax credits,” Brown said.
Free tax help
Free tax help is available to Ohio residents who can’t afford professional tax preparation assistance. Call 1 (800) 906-9887 and enter your zip code for the nearest Volunteer Income Tax Assistance and Tax Counseling for the Elderly site locations.
People with access to the Internet and gross incomes of $58,000 or less can file for free online through the IRS' Web site, www.freefile.irs.gov.
DAYTON — Individual taxpayers and businesses racing to meet Monday’s deadline to file their 2010 tax forms could lose hundreds or thousands of dollars in refunds because of missed deductions, according to area certified public accountants.
Tax forms, credits and incentives change year to year, said Beth Grubb, a tax partner with the Dayton accounting firm Battelle & Battelle LLP. People who are doing their tax forms by hand should consider hiring a CPA or investing in tax preparation software to avoid missing tax breaks, Grubb said.
Taxpayers rushing to complete their returns at the last minute might want to file an extension, rather than risk costly errors.
An extension will give you more time to file your return, but you must still estimate how much you owe and pay that amount by Monday to avoid additional penalties and interest. Failing to pay a sufficient amount could be “more expensive to you in the long run,” Grubb said.
Married couples who both earn income can save hundreds or thousands of dollars based on their filing status, Grubb said. “Married filing joint should be compared to married filing separate,” she said.
Grubb highlighted a number of frequently overlooked tax breaks, including “generous tax credits” this year for both individuals and businesses who made energy efficient property improvements, such as a new furnace or windows.
Taxpayers paying college tuition can claim $2,500 for the first four years of education for each student. People also should consider tax-free college savings programs for future tuition payments, Grubb said.
People who refinanced their homes in 2010 can deduct any mortgage points over the remaining life of the loan, Grubb said.
Charitable contributions are a good deduction, but non-cash contributions such as clothing and appliances must be documented.
“One of the best donations is stock that has appreciated in value,” Grubb said. “You can get a charitable contributions and you do not have to pay tax on the appreciation, so you get two benefits in one,” she said.
While it is too late for this year, Grubb suggested individuals maximize their contributions to IRA or 401(k) retirement savings accounts to reduce taxable income. “Look at your income lines and see how you can save tax there, and then move on to the deductions,” she said.
This year’s Tax Day was extended to Monday from the traditional April 15 deadline because Washington D.C. observed the local Emancipation Day holiday on Friday. The last time an extension was granted for this reason was in 2007.
Taxpayers can even file from their phone now. Those who file a 1040EZ form can prepare and file their state and federal income taxes on their smart phones using SnapTax, a mobile application from TurboTax maker Intuit. The Android and iPhone app is free to download, but filing tax returns costs $14.99.
The IRS in January launched IRS2Go, a mobile application that lets taxpayers check on the status of their federal tax refund and obtain helpful tax information. There have been more than 250,000 downloads of the app as of April 12, according to the IRS.
Contact this reporter at (937) 225-2419 or dlarsen@DaytonDailyNews.com.
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