For 2018, taxpayers have until April 17 (Tuesday) to file their income taxes –and it is right around the corner! Taxpayers can either prepare their income tax returns using do-it-yourself software or hire a professional tax preparer. Both options are available at the likes of Jackson Hewitt so you don’t have any excuse to miss the deadline.
With the federal tax overhaul in effect, taxpayers have plenty of things to be aware of so that they can stay on the good side of the Internal Revenue Service (IRS). Here are a few of them that we believe are the most notable.
Take a Closer Look at Your Medical Expenses
Under the new tax law, the availability of medical expenses deduction has been expanded for both 2017 and 2018. In the previous law, the deduction only applied to medical expenses more than 10% of the taxpayer’s adjusted gross income.
Under the new law, the deduction can be applied to 7.5% of the adjusted gross income for the years 2017 and 2018. But the deduction must be itemized for it to be considered valid.
There’s also another catch: The medical expense deduction will revert to 10% after 2018.
Set Realistic Expectations on Refunds
According to the IRS, most refunds may be possible within three weeks albeit for returns filed electronically. But just as before, refunds on paper returns will likely take several more weeks.
Be sure to set realistic expectations then in regards to your receipt of refund, especially when you’re claiming extra child tax credit or earned income tax credit. You may receive your refund no earlier than February 27 but under two conditions, namely: you chose direct deposit and your tax return didn’t have any issues.
Tip #1: You may want to file your tax return early if you’re claiming one of the two abovementioned tax credits. You can then use the refund in paying off your bills, financing your vacation, or paying your credit card debt.
Tip #2: You may also avail of the no-fee, zero-interest refund advance scheme offered by Jackson Hewitt and H&R Block. You can avail of an advance as much as $3,200 at Jackson Hewitt while it’s $3,000 at H&R Block. You will then repay the advance when you get the refund.
But if you don’t have an urgent need for the refund, you are well-advised to just wait for it instead of taking out on advance on it. You may even find that the anticipation can work in your favor.
