Jackson Hewitt Provides Vital Tax Benefit Information for Those Unemployed
PARSIPPANY, N.J. // PRNewswire-FirstCall // -- With an unemployment rate currently at 10 percent*, Jackson Hewitt Tax Service® highlights several critical tax considerations unemployed consumers need to be aware of that may help them when it comes time to file - including a new tax benefit exempting the first $2,400 of unemployment compensation from their taxable income.
Mark Steber, chief tax officer at Jackson Hewitt, identified four top tax issues individuals unemployed in 2009 need to be aware of:
- Recently signed Workers, Homeownership, and Business Assistance Act of 2009 extends unemployment benefits. The provision provides another 14 weeks of benefits to all unemployed individuals who have exhausted their benefits or will do so by the end of the year. In states where the unemployment rate is at 8.5 percent or higher, individuals will receive an additional 6 weeks.
- Understand the tax free unemployment benefit for 2009: In most tax years, all unemployment compensation received is considered taxable. But for one year only under the American Recovery and Reinvestment Act (ARRA), up to the first $2,400 of unemployment compensation that an individual receives in 2009 is tax free.
- "For example, if you received $5,000 in unemployment compensation, you will only be taxed on $2,600," explained Steber. "For a single taxpayer, this could mean a savings of as much as $240 in income taxes. Married taxpayers who both received unemployment benefits during 2009 will see even greater savings, given they are each eligible for the exclusion."
- Document and deduct qualified job search expenses: Those small job search expenses can add up fast. But when documented properly, many are also tax deductible. Common job-seeking expenses that often qualify include fees for resume development and professional services, long distance calls, mileage driven to job interviews and other travel expenses like airfare or tolls. Start compiling your receipts and logs now so you can ensure you present all expenses to your tax preparer to see if they are qualified deductions.
- Ask a tax professional for help: Beyond providing information on handling unemployment compensation and withholdings - and helping job seekers learn which expenses they qualify to deduct - there are other reasons for unemployed individuals to seek help on their tax returns. It is important to work with tax preparers who are up to speed on all recent changes to tax law, provide free electronic filing (IRS e-file), offer guarantee of service and will be available to you year-round for any questions you may have.
* Source: U.S. Bureau of Labor Statistics
About Jackson Hewitt Tax Service Inc.
Jackson Hewitt Tax Service Inc. (NYSE: JTX), with more than 6,000 franchised and company-owned offices throughout the United States, is an industry leader providing full service individual federal and state income tax return preparation. Most offices are independently owned and operated. Jackson Hewitt is based in Parsippany, New Jersey.
SOURCE Jackson Hewitt Tax Service Inc.