Welcome to Our Tax Tips Newsletter:

Continuing our effort to provide you with valuable, practical tax information, we will periodically update this page with useful income tax tips and income tax advice from the best sources -- information on issues that you commonly deal with. Be sure to check our newletter from time to time to stay on top on of the latest and most effective tax strategies.

TaxEdge will provide income tax tips that will help you save money when it’s time to file your tax returns. It’s a good idea to use a well planned strategy so that you aren’t surprised in April. Using TaxEdge Income Tax Preparation Software and keeping good records could mean the difference between paying a large chunk of money in April and receiving a big refund check. Use our income tax tips as part of your ongoing preparation.

As the filing season gets underway, taxpayers need to be aware of a handful of law changes that have been instituted since last year's filing deadline. The year 2008 didn't see tremendous tax reform, but here are some of the new provisions to keep in mind:

• Recovery Rebate Credit -- Individuals who did not receive a "full" economic stimulus payment may eligible for a recovery rebate credit. The recovery rebate credit is based on a taxpayer's 2008 tax situation, which could have changed from 2007. Forms 1040, 1040-A and 1040-EZ include a line for the recovery rebate credit as well as a worksheet.
• Alternative Minimum Tax -- The Emergency Economic Stabilization Act of 2008 increased the exemption used in calculating liability for the AMT to $69,950 for joint filers and surviving spouses, $46,200 for single individuals, and $34,975 for married persons filing separate returns. However, the "patch" is effective only for the 2008 tax year.
• New Homebuyer Credit -- A first-time homebuyer credit of $7,500 is available, but only temporarily. The credit can be claimed for homes purchased after April 9, 2008 and before July 1, 2009. Taxpayers must file Form 1040 and the new Form 5405 to claim the credit.
• Tax Extenders -- Many temporary tax breaks were extended for businesses and individuals. Business extenders include the research tax credit, Indian employment credit and the low-income housing credit. Individual incentives include the state and local sales tax deduction, qualified higher education expenses deduction, and tax-free distributions from IRAs for charities.
• Employment Tax Returns -- There are now new forms for correcting employment tax return errors. A new series of "X" forms, in English and Spanish, will be issued and used to amend such returns. The new Form 941-X, Adjusted Employer's Quarterly Federal Tax Return or Claim for Refund is now on the IRS website. Form 943-X, 944-X, 945-X and CT-1X will be released soon.

Of course, many of the deductions, brackets and phase-out levels have been adjusted for inflation as well, and that information is found in our Tax Guide. So, stay tuned to TaxEdge for the latest information and changes regarding federal tax obligations!

Income Tax Tips from the 2010 Tax Guide

Who Must File a Return?
Depending on your status and income threshold, you may or may not have to file an annual return.   To avoid running afoul of the rules, please read Who Must File a Return?

Miscellaneous Forms of Income
Certain types of transactions may be considered "income" by the IRS, and thus fall under special rules for reporting and taxation.   For more on this topic, please review Miscellaneous Forms of Income.

Standard and Itemized Deductions
There are many different types of deductions you may be able to use to lower your tax bill. But the rules for each deduction are unique.   For more on this subject, please review Standard and Itemized Deductions.

Estimated Tax Payments
These payments are used to pay tax on income that is not subject to withholding, and they are due quarterly, or penalties will apply.   To learn more about the requirements for these payments, please read Estimated Tax Payments.

Tax News

House, Senate Approve Pension Reform Act
Congress has made some changes to pension law and the tax code, hoping to help retirees through the current economic downturn.    For further details, please read House, Senate Approve Pension Reform Act.

Obama, House Democrats Unveil $825 Billion Economic Stimulus Bill
The new administration, backed by the Democratic congressional leadership, has plans for more than a half-trillion in new spending in 2009, along with some modest tax incentives.    To find out more, please read Obama, House Democrats Unveil $825 Billion Economic Stimulus Bill.

Republicans Unveil Alternative Stimulus Plan with More Tax Incentives, No New Spending
Hoping to provide an immediate stimulus to the economy, Republicans are offering their own plan for increasing economic growth and job creation.    For more information, please read Republicans Unveil Alternative Stimulus Plan with More Tax Incentives, No New Spending.

Major Tax Reform Possible, Even Likely, in 2010
Had the economic downturn not happened, tax reform would have been a congressional priority in 2009. Many observers still feel it's only a matter of time.    For further details, please read Major Tax Reform Possible, Even Likely, in 2010 .