Jackson Hewitt(R) Franchise Shares Top 5 Areas to Review as Part of Mid-Year '5-Point Tax Check-Up'
PARSIPPANY, N.J. // PRNewswire-FirstCall // -- In celebration of the Company's first-ever "Big Tax Check-Up Day," Chief Tax Officer Mark Steber of Jackson Hewitt Tax Service® shares the top five items to consider now as part of a mid-year tax review:
- Review withholdings: Your withholding amount is used to offset or "pay" your taxes when you file your tax return; having too little withheld can result in a low refund or a balance due. Checking your withholding during the year (by speaking with a local tax preparer or consulting the online IRS calculator) is a good way to ensure that you are not having too much or too little federal income tax withheld from your pay. To make the change, provide your employer with an updated copy of your Form W-4 (Employee's Withholding Allowance Certificate).
- Evaluate what you are saving – and how: Look for ways to participate in tax-free savings opportunities which decrease your taxable income, either through your company's 401(k) program or by investing in an IRA. For 401(k) plans, the maximum contribution amount is $16,500; for those 50 years of age or older, you can increase your contribution by an additional $5,500. Also, know how various financial savings tools are impacted by taxes. For example, a traditional IRA or 401(k) may lower your taxes today, but a Roth account will help keep your taxes lower when you retire and start drawing from the account.
- Be on guard for expiring provisions: Unless extended, there are a number of provisions that will not be available on a 2010 tax return, including:
- Tuition and fees deduction – a deduction of up to $4,000 for qualifying tuition and fees expenses
- Educator expense deduction – a deduction for qualified educators of up to $250 for out-of-pocket expenses paid for student rewards, bulletin board supplies, and books for the classroom. Educators may still deduct these work related expenses as a miscellaneous deduction if they itemize.
- State and local sales tax deduction – the option to deduct state and local sales tax paid instead of state and local income taxes paid when itemizing deductions. State and local income taxes may still be deducted when itemizing
- Know which life changes equal tax changes: A wide range of common life occurrences can trigger tax benefits. It may be advantageous to speak with a tax preparer now to obtain a better understanding of tax implications related to situations such as:
- Getting married
- Having or adopting a child
- Moving for a new job or changing jobs
- Plan Tax-Related Expenses Now: Many tax savings correspond to purchases made during the year. For example, if you are considering making energy-efficient improvements to your home, there is still time to do so and reap tax credits, provided that changes are made by December 31. Scheduling visits to the doctor or purchasing deductible medical items, such as eyeglasses, hearing aids, or orthopedic shoes, are items that can be crossed off of a 'To Do' list and added to your deduction file for your 2010 tax return. If you have mortgage or college tuition payments due in January 2011, consider making the January 2011 payment in 2010.
About Jackson Hewitt Tax Service Inc.
Jackson Hewitt Tax Service Inc. (NYSE: JTX), with over 6,000 franchised and company-owned offices throughout the United States in the 2010 tax season, is an industry leader providing full service individual federal and state income tax return preparation. Most offices are independently owned and operated.
SOURCE Jackson Hewitt Tax Service Inc.