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Don't Miss: New Credits for This Tax Season

Every penny counts—especially this tax season! Thankfully, the IRS agrees. So, visit www.irs.gov before doing your taxes to make sure you are getting every qualifying credit and deduction. Read on for some of the not-to-be-missed highlights…

Making Work Pay Credit

Most eligible taxpayers will qualify for the maximum Making Work Pay Credit of $800 for a married couple filing jointly, or $400 for single filers. The credit equals 6.2 percent of earned income up to the maximum amount. Thus, any eligible couple whose earned income is $12,903 or more qualifies for the $800 maximum credit. Single filers qualify for the $400 maximum if their earned income is $6,451 or more. Claim this credit on the new Schedule M.

Government Retiree Credit

This credit is designed to provide a benefit to those government retirees who did not qualify for the economic recovery payment. Retired federal, state or local government employees who received pensions in 2009, based on work not covered by Social Security, are eligible to claim this $250 credit ($500 if both spouses are retired government employees). An individual cannot claim the credit if he or she received an economic recovery payment during 2009. See Schedule M for more details.

Earned Income Tax Credit

The IRS estimates one in four people who qualify for the Earned Income Tax Credit (EITC) don't take it. The EITC is a refundable federal income tax credit for low to moderate income working individuals and families, meaning they have "earned income."

Here's how this credit breaks down according to the number of qualifying children and income limitations:

  • If you have three or more qualifying children and your income limit is $43,279 (48,279 if married filing jointly), you will receive a $5,657 credit.
  • If you have two qualifying children and your income limit is $40,295 ($45,295 if married filing jointly), you will receive a $5,028 credit.
  • If you have one qualifying child and your income limit is $35,463 ($40,463 if married filing jointly), you will receive a $3,043 credit.
  • If you have no qualifying children and your income limit is $13,440 ($18,440 if married filing jointly), you will receive a $457 credit.

If you qualify to claim the EITC on your federal income tax return, you also may be eligible for a similar credit on your state or local return. Twenty-two states offer the EITC, and North Carolina is one of them! And don't forget: Even if you did not earn enough money to require filing a tax return in 2009, you must file anyway to receive this credit.

Home Energy Tax Credits

If you made an energy-efficient purchase in 2009, such as certain refrigerators, washers/dryers, air conditioners, insulation or windows, you can take a credit up to 30 percent of the cost up to $1,500. Visit www.energystar.gov for a list of qualifying products. There is no income limit on this tax credit; however, there is a restriction: The purchase must be for improvements to an existing home that is your principal residence. New construction and rentals do not qualify. Note: This is a combined credit for 2009 and 2010.

Other reminders:

  • Charitable Contributions for Haiti Relief: Even though these were made in 2010, cash contributions to Haiti Relief made between January 11 and February 28, 2010 are includable in 2009 itemized deductions.
  • Unemployment: The first $2,400 of unemployment received is not taxable for 2009.
  • If you are a member of Local Government Federal Credit Union, have your basic taxes prepared and filed for free at your local branch if you have a household income of $49,000 or less. If your household income is more than $49,000, have your basic taxes filed for just $75! Simply contact your local branch to schedule an appointment now through April 15.
  • If you enjoy the convenience of online filing at home, access TurboTax Online through the LGFCU's website at www.lgfcu.org, and receive a 15 percent discount.