Friday, March 20, 2009

Tax rebates, refunds are real head-scratchers this year

Plan on spending some extra quality time with your favorite tax professional this filing season. IRS recently reported we've been muffing a new calculation on about one in seven of some early returns it received.

The problem is the $300, $600 or other stimulus checks we started receiving just after filing season ended a year ago. You may have more money coming if your income, family size or other circumstances changed a lot in 2008. It's an easy calculation for many to miss, Turbo Tax's Bob Meighan told Forbes, because the payments were tax free and many people are simply ignoring those calculations.

Stimulus and rebate calculations may be even more complicated a year from now, tax people say. That's because the government is jiggling payroll deductions to deliver the payments one pay period at a time in your regular check instead of mailing a lump sum later.

Sounds simple, but if yours is a two-income household or you work more than one job, it's going to be very easy to get your withholding out of whack and maybe lose part of the refund you expect next year, reports Bill Toland of the Pittsburgh (Pa.) News-Gazette.

Until then, put on an extra pot of coffee and start planning now to avoid headaches later. H&R Block recaps recent tax changes you need to know about besides the 2008 rebates. And recently updated its now classic list of the nearly dozen deductions we mess up the most.

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