What Tax Credits Are Your Eligible for This Year?

By: Ellen Frick, Outreach Coordinator, NHS of Baltimore

If you have been following this blog over the past few months, much attention has been given to the homebuyer tax credit. In addition to this credit, there are many other changes launching this tax season. The American Recovery and Investment Act of 2009 is a law that affects tax payers both on an individual and a business scale. This legislation is part of an economic stimulus bill designed to expand tax cuts and other social welfare programs. You can find out more information about how this money is being spent by checking out Recovery.gov.

Concerning taxes, many credits were either implemented or expanded and will affect your tax rebate this year. For instance, you may be eligible to receive up to $5,657 back for the Earned Income Tax Credit (EITC), depending on your filing status and how many children you have.If you are currently receiving unemployment benefits, or did at some point during 2009, you will not be taxed for the first $2,400 of those benefits this year.

Another way tax credits have changed is by expanding the requirements for eligibility. This year, more students will be eligible for the American Opportunity Credit for college expenses. Tax credits are also available for things such as child care expenses or the sales tax of a new vehicle.

Make sure that you get all the refunds you are eligible for this tax season. Beware of losing money by utilizing expensive tax preparation services or by taking out a Refund Anticipation Loan (RAL). File your federal taxes electronically using the Free File system made available through the Internal Revenue Service (IRS).

In Baltimore, there are free tax preparation services available if you are a family making less than $49,000 or an individual making less than $25,000 in 2009. NHS of Baltimore is one of the sites providing these free services through a partnership with the Baltimore CASH Campaign. To schedule an appointment at our site, call 410-327-1200. To view a list of other free tax sites around Baltimore, click here .