Ask Andy: Surprise tax deductions! - WMC Action News 5 - Memphis, Tennessee

Reported By Andy Wise

Ask Andy: Surprise tax deductions!

Dan Boone, my good buddy with the IRS regional office in Nashville, dropped by the station the other day -- and dropped a bomb!

He told me about a tax credit I knew nothing about:  the RECOVERY REBATE CREDIT.

It's a tax deduction up to $600 for singles, $1,200 for couples.  You may qualify for the credit if you did not receive a stimulus check from the federal government in 2008, or if you received a partial stimulus payment and qualify for more based on your 2008 income.

"It could also apply to people who had a child born last year," says Boone.  "Or people who were maybe a dependent on their 2007 return with their parents, but in 2008, they went out on their own. Those folks can get possibly $600."

Click on this link to see if you qualify for the credit:

https://sa1.www4.irs.gov/irfof/IRServlet?app=IRACTC&selectLanguage=en

It will ask for your Social Security number, but don't sweat it.  The IRS says that page is secure -- plus it has the "s" after the "http."  That's the sign that it is secure.

The Recovery Rebate Credit is just the start!

These are all new 2008 tax deductions, according to consumer magazine Bottom Line Personal and its source Sidney Kess, a New York CPA and tax author.

*BUSINESS, MEDICAL & MOVING DRIVING DEDUCTIONS. As of last July, the IRS increased the cents-per-mile deduction on driving your personal car for business, medical or moving purposes. It increased 8 cents to 58.5 cents per mile for business, and it bumped up 8 cents to 27 cents per mile for medical and moving. Hope you saved your receipts!

*FIRST-TIME HOME BUYERS CREDIT. Anyone who bought a house after April 2008 who has not owned a home in the last three years qualifies for a tax credit of up to $7,500.

*PROPERTY TAX DEDUCTION FOR NON-ITEMIZERS. Before 2008, our sources say property taxes were only deductible for taxpayers who itemized their deductions. Now, they tell us individuals who do not itemize can deduct up to $500 on a single return and up to $1,000 on a joint return.

*RECESSION DEDUCTIONS. They include deductions for capital losses and worthless securities. You'll have to work these deductions out with both an accountant and your broker.

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