Georgia Southern University professor says: Time to start thinking about filing your 2007 taxes
As 2007 draws to a close, Americans will soon face their annual nemesis: filing their income tax return with the Internal Revenue Service.
‘It’s not too early to start thinking about the process,” says Jill Lockwood, professor of accounting at Georgia Southern University. ‘If you’ve got the documents you need and know what’s new this year, it’s easier to get started.”
Lockwood, who teaches tax law at the undergraduate and graduate levels in the University’s College of Business Administration, offers several tips to help make filing easier:
- You’ll be receiving important tax documents such as W-2 forms, dividend and interest statements, and mortgage interest statements in January. Keep a box close to the place where you open your mail, and put each tax document there as you receive it. When you start your tax forms, the information you need will be in one place.
- The personal exemption for 2007 is $3,400 per dependent.
- The standard deductions for 2007 are:
- Single:? $5,350
- Married filing joint return:? $10,700
- Married filing separate return:? $5,350
- Head of household: $7,850
- Surviving spouse $10,700
- You may be entitled to a $4,000 tuition deduction for tuition paid for post-secondary education that was not covered by HOPE or other scholarship money.
- The 2007 mileage rate for the business use of a car is 48.5 cents per mile.
- All contributions, no matter how small, must be substantiated by a cancelled check or a receipt from the charity.
- All single contributions of $250 or more must be substantiated by a letter from the charity. Your cancelled check will not be enough.
- If you own stock and asked the company to use your dividends to purchase more stock, the cash would have received still must be reported as dividend income.
- If you changed jobs and want to move your 401(k) to an IRA, ask the bank or brokerage firm holding the IRA to send a form to your former employer requesting a ‘trustee to trustee” transfer. If you do, the transfer will not be taxed to you as a taxable distribution.
- If you sold stocks or bonds this year, you will need to know what you paid for the stocks or bonds that were sold. Don’t wait until the last minute to look for this information.
‘Prepare in advance, get your information together,” says Lockwood. ‘Then relax and enjoy the new year.”