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by Don O'Briant, From the AARP Bulletin Print Edition, December 1, 2010|Comments: 0
Nobody wants to think about taxes during the holidays, but preparing for tax season now can save you money and headaches by April 15.
December is not too early to start gathering your receipts and income statements, and it's not too late to implement tax strategies and consider how changes in the laws will affect you.
"This is the month when the first of the letters with 'Important Tax Information' stamped on the front begin to arrive. You may not know what they are, but put them aside with other tax information you will need," said Lynn R. Nelson, a coordinator in Valdosta for AARP Foundation's Tax-Aide program.
Tax-Aide is a free volunteer-run assistance and preparation service for taxpayers with low and moderate incomes, particularly those age 60 and older. Last year, 687 Georgia Tax-Aide volunteers assisted with 44,800 returns with refunds over $23.3 million.
"The biggest change for Georgia taxpayers is that the Georgia Low Income Credit has been suspended. Ten percent or so of the people we do taxes for are only doing them to get this credit. There will be a lot of disappointments because of this alone," Nelson, 65, said.
Those who were eligible for the credit were Georgia residents with a federal adjusted gross income of less than $20,000 and who were not claimed as a dependent by another taxpayer.
According to the Georgia Department of Revenue, retirement income includes items such as interest, dividends, net rentals, capital gains, royalties, pensions, annuities and the first $4,000 of earned income from wages, salaries, tips or a business.
There's still time to take advantage of the federal energy credit, capital gains tax break, Roth IRA conversions and, if you're unemployed, deductions for job-hunting expenses.
"There are many tax-planning strategies," said John Thomas, 67, a Tax-Aide district coordinator in Alpharetta. He highlighted four things taxpayers can do by Dec. 31 to lower their taxes:
For more information about the AARP Tax-Aide program, call 1-888-227-7669 toll-free after Jan. 15; use this online locator tool to find the Tax-Aide location nearest you.
Don O'Briant is a freelance writer in Atlanta.
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