With Tax Day Rapidly Approaching, Schumer Provides Tax Tips That Could Save New Yorkers Thousands
Schumer's new series of helpful hints for New Yorkers aims to make tax season easier for New Yorkers and help them get the full tax benefit they deserveTax tips include how to file online for free, deduct college tuition, qualify for a child tax credit, get a deadline extension, and more; Tips now available online at www.schumer.senate.govNew Schumer report projects that ro
With the April 15 deadline to file federal income taxes fast approaching, US Senator Charles E. Schumer today released a report projecting that almost 3.4 million New York households still have not yet filed their federal income taxes. To make tax season easier for New Yorkers and to help them get their maximum tax benefit, Schumer issued a new series of helpful hints for New Yorkers now available on Schumer's website at www.schumer.senate.gov.
"Mention the date April 15 and almost any New Yorker will roll their eyes and bemoan the inconvenience of having to do taxes," Schumer said. "But the good news is that if you know some helpful hints, you won't have to hire an accountant or waste hours of your time doing it yourself. There are some hidden tax credits and deductions out there that New Yorkers may not know about and some quick free ways to get their returns done. I'm just trying to get the word out to make this process a little easier for New Yorkers and to make sure they get the money they're supposed to get."
Schumer said that many New Yorkers have yet to file their tax returns because they are either too busy with other things like work and raising their children, or don't know how to complete the return accurately and quickly. In fact, Schumer today released a report projecting that with the April 15 deadline looming, 3.4 million New Yorkers have yet to file their returns.
Schumer's report estimated that: " In the Capital Region over 189,000 still have not yet filed their federal income tax returns; " In Central New York over 169,000 still have not yet filed their federal income tax returns; " In the Rochester/Finger Lakes area over 231,000 still have not yet filed their federal income tax returns; " In the Hudson Valley over 428,000 still have not yet filed their federal income tax returns; " In the North Country over 94,000 still have not yet filed their federal income tax returns; " In the Southern Tier over 115,000 still have not yet filed their federal income tax returns; " In Western New York over 278,000 still have not yet filed their federal income tax returns.
[For countybycounty breakdowns, please see attached report.]
To ease New Yorkers' anxiety over lastminute filing, Schumer today released a series of timely tax tips to help them avoid common mistakes and take advantage of deductions and credits they may be entitled to receive:
1) If you're paying for college tuition, you may be eligible for tax credits or deductions. Schumer warned New Yorkers to be sure to take advantage of college tax credits and tax deductions for themselves, their spouses or children.
" Single filers with taxable income of up to $65,000 and joint (married) filers with income of up to $130,000 can deduct $3,000 in tuition costs from their taxable income as part of 2001 legislation modeled after Schumer's Make College Affordable Act. Last year, more than 3 million households took advantage of this program. Schumer said that this is only the second year this program has been available and encouraged New Yorkers to take advantage of it this year. This deduction can be found on the first page of the 1040 Federal Income Tax Return form (Item 26). " Tax credits for higher education are available through both the Hope and Lifetime Learning Credit. If you are filing a joint return or single return and make less than $103,000 and $51,000 respectively, you may be eligible for one of the credits. The Hope Scholarship credit is worth 100% of the first $1,000 you spend and 50% of the next $1,000 on each of the first two years of undergraduate study for each eligible student. The Lifetime Learning Credit can provide as much as $2,000 for 2003 and can refund up to 20% of the first $10,000 you spend for highereducation costs beyond the first two years of undergraduate study. These tax credits can be found on the second page of the 1040 form (Item 47). " New Yorkers with student loans can write off up to $2,500 of their interest if their income is $130,000 or less on a joint return, or $65,000 on an individual one. This item is found on the front of the 1040 form (Item 25).
2) Think twice before filing by credit card. It might be tempting to use your credit card to charge your taxes but New Yorkers should be forewarned that IRS slaps a "convenience fee" on credit card filings that amounts to 2.5% of the amount you charge. For a $400 payment that means $10, for example. The money is collected by one of the two vendors that facilitate these transactions (Official Payments Corp. and Link2Gov Corp.), and split with the card issuers.
3) If you have children under 17, you may be entitled to get thousands back this year. Households filing joint returns (for married couples) between $27,000 and $110,000 or single returns of up to $55,000 are eligible for a child tax credit of up to $1000 per child under the age of 17. The actual tax credit received will depend on the amount of income tax you owe. According to the IRS, some recipients of the child tax credit already received part of the credit in the form of a check this summer. Beware that if you received such a check it counts as part of the credit you are entitled to receive and you will be expected to subtract that amount from the total you claim. For example, if you are entitled to $1000 and received a $400 check this summer, you may only claim $600 now. Failing to do this could result in long delays in getting your money. The Child Tax Credit is located on the second page of the 1040 form (Item 49).
4) The Earned Income Tax Credit can be worth more than $4,000, but is often overlooked by as many as 20% of qualified taxpayers. To qualify for this tax credit, you must have an earned income of less than $29,666 for a taxpayer with one child (or $30,666 if you are married and filing jointly), $33,692 for a taxpayer with more than one child ($34,692 for married filing jointly), and $11,230 for a taxpayer with no children ($12,230 for married filing jointly). This tax credit is designed to reduce taxes for low income workers and can result in thousands of dollars. The Earned Income Tax Credit is located on the second page of the 1040 form (Item 63). More detailed requirements and instructions are available at www.irs.gov.
5) Remember to deduct your IRA contributions. Deductions for contributions to the popular pension plans known as IRAs have increased by $500 if you are 50 or older from $3,000 to $3,500. Single filers making up to $50,000 and joint filers making up to $70,000 of any age can deduct part of their standard IRA contributions if they are covered by a pension plan at work. This deduction is found on the front of the 1040 form (Item 24). More detailed requirements and instructions are available at www.irs.gov.
6) You can file online for free. Filing from a computer can be easy and not cost a dime and you will not have to remember to go to the post office. Online services can help you wade through confusing terminology by explaining the different categories to you. In addition, many online sites also will compute your state taxes. This year, IRS has partnered with a number of companies to offer free online filing to 60% of all households, depending on your income levels . For example, if your adjusted gross income is less than $54,000 you can file for free with eSmartTax.comï¿½ (www.esmarttax.com/free2004.asp). For a full list of companies offering free efiling please visit the IRS web site (http://www.irs.gov/app/freeFile/jsp/index.jsp?).
7) If you can't file your taxes by April 15, you are not out of luck. If filing by April 15 is simply not a possibility, rest assured you have options. You can file for an extension until August 16. First you must estimate your total tax liability for the 2003 tax year as well as what you have already paid this year (for example, the taxes withheld from your paycheck). If IRS believes you have reasonable estimates, the approval process will be automatic and you will get a four month delay. It is important to note that you will be charged interest on an outstanding balance until your return is filed. Your extension must be filed by April 15. This form (Application for Automatic Extension of Time To File U.S. Individual Income Tax Return) is available at www.irs.gov.
Schumer said that the full report and series of tips are available on his web site (www.schumer.senate.gov) and encouraged New Yorkers to call his local offices for information. "The bottom line is that doing your taxes will never be a picnic or a day at the park, but we can make it easier and more productive," Schumer said. "If New Yorkers follow these tips, they might learn about thousands of dollars that are available to them and hopefully will be able to do their taxes with a little less anxiety."
Previous Article Next Article