Monday, November 16, 2009

There are some tax breaks you don't want

More than 15 million taxpayers may owe Uncle Sam another $250 next filing season, a Treasury Department Inspector General reports.

Lower payroll taxes passed last spring to pump money into the economy ended up putting too much money back into the checks of workers with more than one job, of which there have been many this recession. Social Security recipients who worked part time may be hit too.

IRS has a free calculator to help you see what your situation is. There are barely six weeks left in the tax year, though, which leaves little time to do anything other than brace for impact.

The recession has produced some really crummy tax breaks you need to prepare for if you qualify. My two favorites? The first $2,400 of unemployment benefits you collected in 2009 are tax exempt. You pay taxes on the rest. Forgiven debt usually counts as taxable income, but not if you lost your home or modified your mortgage.


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