More Than Accounting

Archive for February, 2008

2007 Individual Tax Tips

Posted by Rhonda Spaulding on February 9, 2008

The W-2s and 1099s are done so it is time to gather your information and actually prepare your tax return. Here are some items to remember as you get everything together.

  • Charitable contributions require a receipt this year. No longer can you deduct your small cash contributions without a receipt, bank statement or canceled check. You should also beware of the more strict limits on non-cash contributions.
  • For mortgages closed or refinanced in 2007, you can deduct any Private Mortgage Insurance (PMI) premiums paid during the year.
  • The residential energy credits are still available. If you made some improvements this year, get those receipts and take advantage of these credits that expired at the end of 2007.
  • You can still contribute to your IRA and take advantage of the Saver’s credit. This can significantly reduce your tax due and let you keep your money.
  • This year you are also eligible to deduct either your state income tax or sales tax paid. There are standard amounts for sales tax deductions if you did not save all of your receipts. Generally, for Indiana and Kentucky the income tax will be the higher of the two, but if you built a house or made other significant purchases, your sales tax deduction may be the larger of the two. It is definitely worth checking out.
  • Teachers can still take advantage of the credit for supplies purchased for the classroom. Store those receipts and take advantage of this credit.
  • There are still several of the energy conservation credits available.  If you added new windows, doors or other energy saving home improvements you should determine if it qualifies for the credit.

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