Your tax return preparer will need the amount of the stimulus payment that you received in 2008. You will need the following information: your social security number, your filing status, and the number of exemptions shown on your tax return. Here’s the link: IRS Stimulus Payment.
Month: February 2009
The American Recovery and Reinvestment Act of 2009
Dear CPA: Does this legislation affect 2008 returns?
Dear Taxpayer: Generally, no. The new legislation does not have any major impact for the vast majority of individuals preparing their 2008 tax returns due April 15. Instead, these changes will largely impact 2009 tax returns filed next year, in 2010. Taxpayers should continue to prepare their 2008 tax returns as they normally would. And remember, the sooner you provide complete and adequate information to your CPA, the sooner your return will be prepared!
Advance Earned Income Credit (EIC) Payment
An employee who expects to be eligible for the earned income credit (EIC) and expects to have a qualifying child is entitled to receive EIC payments with their pay during the year. To get these payments, the employee must provide the employer a properly completed Form W-5, Earned Income Credit Advance Payment Certificate. Employers are required to make advance EIC payments to employees who give them a completed and signed Form W-5.
Certain employees who do not have a qualifying child may be eligible to claim the EIC on their tax return. However, they cannot get advance EIC payments.
For 2009, the maximum amount of advance payments an employee can receive is a total of $1,826.
Roth IRA’s
Dear CPA:
I am working on my retirement planning and definitely need to increase the amount that I am saving. How can I look up the tax bracket that I am in so that I can figure out the net I should deposit into a Roth on a monthly basis?
Dear Taxpayer:
The tax bracket that you are in does not directly affect the computation of your Roth IRA deduction. The absolute amount of your adjusted AGI is the important figure. The phase out limits are listed here. The amount that may be contributed for 2008 by April 15, 2009, is generally $5000 per person. I recommend contributing for 2009 as early in the year as possible to gain an extra year of tax free growth.