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Bluewater Accounting
& Tax Service, LLC
& Tax Service, LLC
Issue Number: IRS TAX TIP 2010-07
Inside This Issue
--------------------------------------------------------------------------------
Three Reasons to Prepare and File Your Taxes Electronically
Last year, 2 out of 3 tax returns were filed electronically. Was yours? If not, here
are three important reasons to e-file your return.
1.It’s fast Your tax return will get processed more quickly if you use e-file. If there
is an error on your return, it will typically be identified and can be corrected right
away. If you file electronically and choose to have your tax refund deposited
directly into your bank account, you will have your money in as few as 10 days.
2.It’s safe When you file a tax return electronically, the IRS is fully committed to
protecting your information on our tax processing systems.
3.It’s time Don’t miss out on the benefits of e-file, 2 out of 3 taxpayers, 95 million,
already get the benefits of e-file.
E-file software reduces the chance of making errors when you prepare your
return. However, some people still print the computer generated return and mail
it to the IRS instead of hitting the “Send” button. By mailing the return, taxpayers
miss out on some important benefits of IRS e-file.
•With e-file, you get the peace of mind that comes with the electronic receipt you’ll
receive notifying you that the IRS received your tax return.
•Virtually everyone can prepare a return and file it for free. For the second year,
the IRS and its partners are offering the option of Free File Fillable Forms.
Another option is Traditional Free File. About 98 million taxpayers – 70% of all
taxpayers – are eligible for the IRS Traditional Free File. Traditional Free File is a
service offered by software companies and the IRS in partnership to provide free
tax preparation software and free filing.
•E-file is available 24 hours a day, seven days a week, from the convenience of
your own home.
•If you owe money to the IRS, e-file also allows you to file your tax return early and
delay payment up until the due date.
•In 37 states and the District of Columbia, you can simultaneously e-file your
federal and state tax returns.
Updated Nov. 6, 2009: The newly-enacted Worker, Homeownership And Business
Assistance Act Of 2009 extends and expands the first-time homebuyer credit. The
new law also expands the Net Operating Loss (NOL) provision.
Información en Español
Information for Individuals
Some of the provisions of the law primarily affect individuals.
Making Work Pay Tax Credit. This tax credit means more take-home pay for many
Americans. To make sure enough tax is withheld from their pay, taxpayers can
use the IRS withholding calculator. See Making Work Pay for more.
First-Time Homebuyer Credit Expands. Homebuyers who purchase in 2009 can
get a credit of up to $8,000 with no payback requirement. New legislation extends
and expands this credit.
Money Back for New Vehicle Purchases. Taxpayers who buy certain new vehicles
in 2009 can deduct the state and local sales taxes they paid or other taxes and
fees they paid in states with no sales tax.
Education benefits. The new American opportunity credit and enhanced benefits
for 529 college savings plans help families and students find ways to pay higher
education expenses.
Enhanced Credits for Tax Years 2009, 2010. Find details on the earned income
tax credit and the additional child tax credit.
Increased Transportation Subsidy. Employer-provided benefits for transit and
parking are up in 2009.
Up to $2,400 in Unemployment Benefits Tax Free in 2009. Individuals should
check their tax withholding.
$250 for Social Security Recipients, Veterans and Railroad Retirees. The
Economic Recovery Payment will be paid by the Social Security Administration,
Department of Veterans Affairs and the Railroad Retirement Board.
Energy Efficiency and Renewable Energy Incentives. See what individuals can do
to reap tax rewards.
Health Coverage Tax Credit. The credit increases from 65 percent to 80 percent
of qualified health insurance premiums, and more people are eligible.
Information for Businesses
Some of the provisions of the law primarily affect businesses.
Making Work Pay Tax Credit. Businesses should use the new withholding rates for
their employees. For pension plan administrators, new optional withholding
procedures are available to supplement the February withholding tables.
Work Opportunity tax credit. This newly-expanded credit adds returning veterans
and "disconnected youth" to the list of new hires covered by the credit that
businesses may claim. Businesses have until Oct. 17 to request certification for
the tax credit for some new hires.
COBRA: Health Insurance Continuation Subsidy. The IRS has extensive guidance
for employers, including an updated Form 941, as well as information for
qualifying individuals.
Energy Efficiency and Renewable Energy Incentives. See what businesses can do
to reap tax rewards.
Net Operating Loss Carryback. Small businesses can offset losses by getting
refunds on taxes paid up to five years ago. Information on the carryback, an
expanded section 179 deduction and other business-related provisions, is now
available. The Worker, Homeownership And Business Assistance Act Of 2009
(WHBAA) further expands the five-year NOL carryback to most businesses.
Municipal Bond Programs. There are new ways to finance school construction,
energy and other public projects.
Inside This Issue
--------------------------------------------------------------------------------
Three Reasons to Prepare and File Your Taxes Electronically
Last year, 2 out of 3 tax returns were filed electronically. Was yours? If not, here
are three important reasons to e-file your return.
1.It’s fast Your tax return will get processed more quickly if you use e-file. If there
is an error on your return, it will typically be identified and can be corrected right
away. If you file electronically and choose to have your tax refund deposited
directly into your bank account, you will have your money in as few as 10 days.
2.It’s safe When you file a tax return electronically, the IRS is fully committed to
protecting your information on our tax processing systems.
3.It’s time Don’t miss out on the benefits of e-file, 2 out of 3 taxpayers, 95 million,
already get the benefits of e-file.
E-file software reduces the chance of making errors when you prepare your
return. However, some people still print the computer generated return and mail
it to the IRS instead of hitting the “Send” button. By mailing the return, taxpayers
miss out on some important benefits of IRS e-file.
•With e-file, you get the peace of mind that comes with the electronic receipt you’ll
receive notifying you that the IRS received your tax return.
•Virtually everyone can prepare a return and file it for free. For the second year,
the IRS and its partners are offering the option of Free File Fillable Forms.
Another option is Traditional Free File. About 98 million taxpayers – 70% of all
taxpayers – are eligible for the IRS Traditional Free File. Traditional Free File is a
service offered by software companies and the IRS in partnership to provide free
tax preparation software and free filing.
•E-file is available 24 hours a day, seven days a week, from the convenience of
your own home.
•If you owe money to the IRS, e-file also allows you to file your tax return early and
delay payment up until the due date.
•In 37 states and the District of Columbia, you can simultaneously e-file your
federal and state tax returns.
Updated Nov. 6, 2009: The newly-enacted Worker, Homeownership And Business
Assistance Act Of 2009 extends and expands the first-time homebuyer credit. The
new law also expands the Net Operating Loss (NOL) provision.
Información en Español
Information for Individuals
Some of the provisions of the law primarily affect individuals.
Making Work Pay Tax Credit. This tax credit means more take-home pay for many
Americans. To make sure enough tax is withheld from their pay, taxpayers can
use the IRS withholding calculator. See Making Work Pay for more.
First-Time Homebuyer Credit Expands. Homebuyers who purchase in 2009 can
get a credit of up to $8,000 with no payback requirement. New legislation extends
and expands this credit.
Money Back for New Vehicle Purchases. Taxpayers who buy certain new vehicles
in 2009 can deduct the state and local sales taxes they paid or other taxes and
fees they paid in states with no sales tax.
Education benefits. The new American opportunity credit and enhanced benefits
for 529 college savings plans help families and students find ways to pay higher
education expenses.
Enhanced Credits for Tax Years 2009, 2010. Find details on the earned income
tax credit and the additional child tax credit.
Increased Transportation Subsidy. Employer-provided benefits for transit and
parking are up in 2009.
Up to $2,400 in Unemployment Benefits Tax Free in 2009. Individuals should
check their tax withholding.
$250 for Social Security Recipients, Veterans and Railroad Retirees. The
Economic Recovery Payment will be paid by the Social Security Administration,
Department of Veterans Affairs and the Railroad Retirement Board.
Energy Efficiency and Renewable Energy Incentives. See what individuals can do
to reap tax rewards.
Health Coverage Tax Credit. The credit increases from 65 percent to 80 percent
of qualified health insurance premiums, and more people are eligible.
Information for Businesses
Some of the provisions of the law primarily affect businesses.
Making Work Pay Tax Credit. Businesses should use the new withholding rates for
their employees. For pension plan administrators, new optional withholding
procedures are available to supplement the February withholding tables.
Work Opportunity tax credit. This newly-expanded credit adds returning veterans
and "disconnected youth" to the list of new hires covered by the credit that
businesses may claim. Businesses have until Oct. 17 to request certification for
the tax credit for some new hires.
COBRA: Health Insurance Continuation Subsidy. The IRS has extensive guidance
for employers, including an updated Form 941, as well as information for
qualifying individuals.
Energy Efficiency and Renewable Energy Incentives. See what businesses can do
to reap tax rewards.
Net Operating Loss Carryback. Small businesses can offset losses by getting
refunds on taxes paid up to five years ago. Information on the carryback, an
expanded section 179 deduction and other business-related provisions, is now
available. The Worker, Homeownership And Business Assistance Act Of 2009
(WHBAA) further expands the five-year NOL carryback to most businesses.
Municipal Bond Programs. There are new ways to finance school construction,
energy and other public projects.
scams such as telephone calls or
e-mails claiming to be from the
IRS and asking for sensitive
financial information. The IRS will
not call or e-mail taxpayers nor
will it ask for financial information.
Scam e-mails and information
about scam calls should be
forwarded to phishing@irs.gov.
e-mails claiming to be from the
IRS and asking for sensitive
financial information. The IRS will
not call or e-mail taxpayers nor
will it ask for financial information.
Scam e-mails and information
about scam calls should be
forwarded to phishing@irs.gov.