COLUMBIA, Mo. – Take a few minutes now to prepare for the upcoming income tax season, says University of Missouri Extension personal financial planning specialist Andrew Zumwalt.
Get a manila folder or large envelope and leave it where you open your mail. Put 1099, W-2 and any other tax forms in the folder as they arrive. Having the forms in one handy place will save you from searching for them later, Zumwalt says.
Also, review investments and consider increasing contributions to your IRA. You have until April 15 to contribute to your IRA for the 2013 tax year.
There are few major changes in tax laws this year for the average wage earner, Zumwalt said. The premium tax credits and penalties from the Affordable Care Act won’t go into effect until the 2014 tax year.
Homeowners who bought their first home in 2008 and received the first-time homebuyer credit will need to continue paying back the credit.
People under 65, the threshold for deducting itemized medical expenses has increased from 7.5 to 10 percent of gross adjusted income. There are no changes for those 65 and older.
Zumwalt said now is a good time to shop for someone to file your taxes or look at a free program offered through United Way and Wal-Mart at www.myfreetaxes.com. The free program is for those making $58,000 or less annually.
He also suggests the Volunteer Income Tax Assistance (VITA) program for individuals and households making $52,000 or less annually.
VITA is an IRS-sponsored program that provides free tax preparation assistance for low- to moderate-income filers. Trained community volunteers help with special credits, such as the earned income tax credit, child tax credit and credit for the elderly or the disabled. Most VITA sites also offer free electronic filing.
To find a VITA site in your area, go to irs.treasury.gov/freetaxprep and enter your ZIP code.
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