To access you tax refund information, you will need some information from the Form 1040, 1040A or 1040EZ you just filed. This includes your Social Security number, filing status and the exact amount of the refund. Your Social Security number is located in the upper-right corner on the first page of all 1040 forms. Your filing status is one of the boxes labeled 1 through 5 that you checked on page one of all 1040 forms. The refund amount is located on Line 74a for Form 1040, Line 43a for Form 1040A and Line 11a for Form 1040EZ.

Go to the IRS Where’s My Refund? website. Enter your Social Security number and the refund amount in the appropriate boxes and fill in the bubble next to your filing status. All the information you enter must match what the IRS has in its records, so double check all the numbers you enter to ensure there are no mistakes. If you need help identifying the requested information on your tax return, click the “shown on your tax return” link in each section for details about where to find it. Click “Submit” and you refund status will appear.

You can also check your tax refund status over the phone by calling the IRS at 800-829-1954. Provide your Social Security number, filing status and the amount of the refund to hear an automated message regarding your tax refund.

If the information you provide online or over the phone does not match what is in the IRS database, you will get a message requesting you to fix any mistakes or contact the IRS for further assistance. If you are sure the information you entered is right, wait 24 hours and try again. If you still cannot check your tax refund status, contact the IRS at the number it provides on its website.

When Your Tax Refund Will Be Mailed or Deposited

The IRS has taken some of the guesswork out of planning for when your tax refund will be mailed or deposited into your checking account. They have provided a chart, as seen below, that can assist you in determining when to expect your money. One thing to note is the cutoff time for a return to be accepted (the leftmost column) is 11 am eastern time on the day it was accepted. If it is accepted after 11 am it would be counted as accepted the following day in terms of meeting the mailing and deposit deadlines.

When you eFile your return you’ll know for sure exactly when your tax return was accepted because you will receive an email confirmation. If you mailed in your return you won’t know exactly when the IRS received and accepted it, so you’ll probably want to use their refund lookup tool mentioned above.

Finally, it’s probably worth reminding you that you still need to get your taxes filed before the tax deadline to avoid penalties. If it doesn’t look like you’ll be able to meet the deadline, then you should look into filing a tax extension.

Tax Extension Basics

All U.S. taxpayers are eligible to receive a six month extension of the filing of their taxes, pushing the due date from April 15 to October 15 (or next business day if these dates fall on a weekend or holiday). The effect of this filing is that the IRS will permit you to delay the filing of your tax return for this additional period of time in order to collect additional information, to locate missing documentation, or because you simply put it off for too long. The purpose of this tool is to allow you more time to collect the information needed to file a complete and accurate return.

The key point here is that it grants you additional time to file your return, not pay your taxes. This is the biggest misconception people have about tax extensions. They usually assume that if you file an extension you also don’t have to pay any taxes, if you owe, until the extension deadline. Unfortunately, that’s not what an extension does.

Filing the Extension

The paperwork required by the IRS to receive a tax extension is called Form 4868. It asks for some basic information and is as short as a single page. In the majority of cases, this is the only documentation required. If the form is completed correctly and on time, the extension should be granted.

Form 4868 is available is a wide variety of formats and from a wide variety of sources. In fact, if you prepare your taxes with the help of software such as TurboTax you’ll have an option to print and file the extension form. Once it has been completed, the software will provide directions on how the form can be filed electronically right through the software.

For individuals who do not use tax preparation software but wish to file their extension electronically, the IRS website provides a series of electronically available forms. These can be filed out online and filed directly. The advantage of using tax preparation software to those who intend to file this way is that the information is then integrated in one’s overall return. There is no distinction on the part of the IRS.

Individuals who use a tax preparer can simply request that they use file the extension. In most cases this will be done electronically, but no further action will be required by the individual. The final approach one can use is to file with a paper Form 4868. The form is available to be printed online, as well as through multiple sources of paper tax documents. The post office, for example, will have complete sets of tax forms; these packets will include Form 4868. Once the form is obtained, it can be filled out and mailed to the IRS.

The Ramifications of a Tax Extension

Filing a tax extension gives the taxpayer longer to collect pertinent information and file a complete and accurate return. It also allows a taxpayer to avoid be assessed a “Failure to File” penalty, which can be significant. But keep in mind that a tax extension gives one longer to file, not longer to pay. At the time a tax extension is filed, the IRS expects the taxpayer to make an estimate of the amount of tax that will be owed and to pay that amount. Interest charges will begin to accrue immediately following the regular tax deadline, so making a payment at the time the extension is filed is important to avoid additional costs.

These penalties can add up. There are two basic penalties the IRS typically imposes: a late filing penalty of 5 percent per month on any tax due plus a late payment penalty of half a percent per month. If you file an extension and then file by the extended deadline you’ll avoid the hefty 5 percent per month penalty. But if you don’t make an estimated tax payment by the April deadline you will still be assessed the half a percent per month penalty.

The Postmark Date

The good news is that a tax return delivered to the IRS by U.S. mail after the due date for the tax return is considered timely filed if the tax return was postmarked on or before the due date of the tax return. This is good news because that means you don’t have to submit your filing and payment a week in advance just to be sure it is in their hands by the deadline. So if you want, you can actually wait until the 18th to get everything in the mail provided the postmark on the envelope shows the 18th. While you can wait until the very last day to do so, I would recommend still mailing a day or two early just to be safe in the event of something coming up that doesn’t permit you to get to the post office or meet the last postal pickup for that day in order to get that day’s postmark.

What About Extensions?

If you filed an extension, you are not off the hook. This extension is simply for filing the paperwork, not the tax payments you owe. If you have waited this long and still don’t know roughly how much you will owe I urge you to find out as soon as possible. You will still need to have your payment, or at least an estimated payment postmarked by the 18th in order to be considered as on time even if you have filed an extension or plan to file one.

The extension will at least prevent you from receiving a late filing penalty on your paperwork but interest will be charged on unpaid tax from the original due date of the tax return. So it is important to send at least an estimated payment before the deadline even if you have filed for an extension so you can avoid as much interest as possible.

In addition to interest, there is an issue with late payment penalties as well. This means it is very important to know fairly close to how much your payment will be. The IRS will not impose a late payment penalty so long as the estimated payment you send is at least 90% of the actual payment you owe and that the remainder of the payment is submitted before the end of the extension deadline. So, if you expect your tax payment to be around $1,000 don’t send them a check for $200 as an estimated payment while you continue to work on your return in the extension period.

What You Can do to Avoid Payment Problems Next Year

If you are employed and have taxes withheld each paycheck, the first plan of attack is to adjust your tax withholding. This is done via form W-4 which you should get from your employer and then notify them of any changes. I talked about how to calculate and update your withholding in the past, and this is the best way to make paying your taxes manageable.

If you are self-employed or already file quarterly estimated taxes then it is up to you to make sure you are putting enough money aside to make the appropriate payments each quarter so you aren’t stuck with a bill at the end of the year. Understandably this can be difficult to do when you have income that fluctuates, so the best you can do is estimate what you will owe to the best of your ability. If possible try to withhold a bit more than you think you may need to so that any unexpected changes in income or expenses later in the year won’t throw you off. It is better to err on the side of caution and get a small refund at the end of the year instead of a surprise tax bill.

Doing your own taxes can be an effective way to save time and money. Using the popular tax software H&R Block at Home or TurboTax, you can even start your tax preparation online for free. Then if you decide to, you can purchase the full version and even e-file right online. Getting a head start will ensure you don’t run too close to the tax deadline.

Many states have initiated a sales tax holiday in order to help families to buy supplies they want and need, but also coincide with back-to-school shopping. Most tax holidays help parents save money for school supplies and provide a temporary boost to retail business. The sales tax holiday can include clothes, personal items, and even certain types of electronic equipment. A growing number of states have implemented these holidays, although there are still a number of states with a sales tax that do not participate. I should know, because I live on the Michigan and Indiana border and do my shopping there, but neither state takes part.

Alabama

August 5-7 Covers up to $100 worth of clothes, up to $750 for computers, $50 for school supplies, and $30 for books. - http://www.revenue.alabama.gov/

Arkansas

August 6-7 Covers up to $100 for clothes and all school supplies. - http://www.dfa.arkansas.gov

Connecticut

August 21-27, Covers clothing and footwear up to $300. - http://www.ct.gov/

Florida

August 12-14, Covers books, clothing and footwear under $50 and school supplies under $10. - http://dor.myflorida.com/

Iowa

August 5-6, Covers clothing and footwear under $100 per item. - http://www.iowaccess.org/tax/

Louisiana

August 5-6, Covers most personal property. - http://www.revenue.louisiana.gov/

Maryland

August 13-19, Clothing or footwear under $100 excluding accessory items. - http://www.comp.state.md.us/

Massachusetts

August 13-14. Anything under $2500 . - http://www.mass.gov/

Mississippi

July 29 �’ 30, Clothing and footwear <$100. - http://www.dor.ms.gov/

Missouri

August 5-7, Clothing under $100 each, school supplies under $50 each, computer and equipment under $3500. – http://www.dor.mo.gov/tax/

New Mexico

August 5-7, Clothing and footwear under $100 each, school supplies under $15 each, computers under $1000 and computer equipment under $500. - http://www.tax.newmexico.gov/

North Carolina

August 6-8, Covers clothing under $100 per item, school instructional materials <$300 per item, sports & rec equipment under $50 per item, computers/software/computer supplies <$250 per item. November 5-7 Energy star rated appliances for non-business purposes. - http://www.dornc.com/

Oklahoma

August 5-7, Covers clothing and footwear under $100 each. - http://www.tax.ok.gov/

South Carolina

August 5-7, Covers clothing, school supplies computers & computer software, and linens. October 1-31 Covers qualified Energy Star items for personal use less than $2,5000. - http://www.sctax.org/

Tennessee

August 5-7 Clothing under $100 per item, School and Art Supplies under $100 per item, and Computers under $1500 per bundled package. - http://tn.gov/revenue/

Texas

August 19-21, Clothing and footwear under $100, and backpacks under $100. May 28-30 Energy star products , air conditioners under $6000, and other products under $2000. - http://www.window.state.tx.us/

Virginia

August 5-7, under $20 per item and clothing & footwear under $100 per item. October 7-10 Energy Star Qualified products including appliances purchased for personal use under $2,500 each. - http://www.tax.virginia.gov/

States Without Sales Tax

Don’t see your state on the list? Well, there is good news and bad news. The good news is you may live in a state that doesn’t have a state-wide sales tax to begin with. Residents of Alaska, Delaware, Montana, New Hampshire and Oregon fall into this category. But if you don’t live in one of these states and don’t see your state listed above, you’re on the hook for sales tax all year long. Sorry.

You’ve determined that you need to make estimated tax payments, so what’s next? You have two options when it comes to making those quarterly estimated tax payments. If you like the tried and true method of printing out forms and sending a check in the mail, you’re going to want to refer to IRS Form 1040-ES. Even if you aren’t going to mail in payments, you’ll still want to print out a copy of this useful form. It has a lot of information on how to determine whether or not you owe estimated taxes, has a worksheet to help you calculate how much your payments should be, and the dates the payments are due.

If you are going the mail and paper check route be sure to look carefully at the form to determine the correct mailing address for your payment. The payment location varies based on your location, so to make sure your payment gets credited properly and on time you want to make sure it goes to the right place. You’ll also want to make sure your tax payment is postmarked on or before the deadline dates, which are:

• 1^st payment: April 15
• 2^nd payment: June 15
• 3^rd payment: September 15
• 4^th payment: January 15

If you’ll notice, the payments don’t follow the typical calendar year quarter schedule. You only have two months between the first and second payment and four months between the third and fourth payment. This can trip new estimated tax filers up, so mark these dates on your calendar.

Finally, if printing out payment vouchers and mailing a check isn’t your thing, you’re in luck. You can make electronic payments via the Electronic Federal Tax Payment System, or EFTPS. You’ll need to create an account and wait to receive a PIN in the mail before you can make payments with this system, but it makes those payments even easier. You can link right up to an existing bank account and have the funds transferred electronically. Even better, you can schedule all of your payments in advance so you don’t have to worry about missing a payment.

Keep in mind that this only applies to your federal taxes. You’ll also need to check with your state to see how they accept payment, and in most cases they also have the same payment deadlines and will impose penalties for late payments.

Increase Withholding to Avoid Estimated Tax Payments

If you’re on the hook for making estimated tax payments but also have income that has tax withheld, you’re in luck. As long as you earn enough with your regular job, you can increase your tax withholding instead of making extra quarterly payments. As an added bonus your withholding is counted as if it was made equally throughout the year even if it wasn’t. This can help you avoid penalties on underpayment of estimated taxes.

To increase the amount of withholding from your paycheck you’ll need to fill out a new IRS Form W-4 and a state W-4 if you wish to change state tax withholding as well. You can print on off or check with your human resources department to file the change. There are two ways to change withholding on a W-4 form. The first is to reduce the number of allowances you claim on the form. The fewer the allowances, the more tax is withheld. The problem is you don’t know exactly how much more will be withheld.

The second way to change your withholding is to simply request an additional amount on the form. So, if you’ve calculated that you will need to pay $2,000 in estimated tax throughout the year and you have 13 paychecks left in the year, you can divide $2,000 by 13 to get $154 that you can then write in the additional amount box. This will make sure enough is withheld by the end of the year to meet your estimated tax payment amount. Just remember that you’ll want to adjust this again in January if you made a change to your withholding at some other point in the year.

Obviously, this method only works for those who have a source of income that has tax withheld, so those of you who are entirely self-employed or receive income that doesn’t have tax withheld you’ll need to revert to the traditional quarterly payment schedule.

9 ways to get prepared for your tax appointment

10 ways to save money on your tax return

5 benefits of using a tax professional

9 Ways to Get Prepared for Your Tax Appointment

Some of these so-called “organization” tips may seem like common sense, but the truth is, not being prepared for tax time can cost you quite a bit of money. If you have an accountant do your taxes and throw a shoebox full of receipts at them, it’s likely they will charge you the extra time required to get it organized �’ especially if it’s something you could’ve done yourself. Make your accountant happy and get organized before you go to your appointment:

• Organize expenses and income �’ Get together all 1099s and business receipts from the previous calendar year. Organize them by category in an expandable file folder. Or, if you use an accounting program, do the same with your software.
• Do part of the work at home �’ Even if you plan to meet with a tax pro, consider utilizing one of the many available free tax software tools to do a bit of up-front work. The software takes the guesswork out of deductions by allowing you to search for possible deductions you may qualify for.
• Bring in an organizer �’ If your tax preparer mailed you an organizer, be sure to fill it out prior to your appointment. Even if you don’t have a lot of information to include, it helps to have at least something for them to look at.
• Research your charitable deductions �’ Find out the tax status of your charitable deductions by visiting www.irs.gov/app/pub-78/
• Find your investment’s cost basis �’ If you sold investments last calendar year, it’s important you know your cost basis (the purchase price + sales commissions and fees, adjusted by reinvented dividends and stock splits). Not knowing may make you pay more in capital gains tax.
• Record of non-cash contributions �’ If you made non-cash contributions to items over $500 (ex. A car or electronics), provide your accountant with that information.
• Find year-end statements:
  • Brokerage accounts �’ Year-end statements for any brokerage accounts you have (1099-DIV, 1099-INT and 1099-B) are useful when filing.
  • Profit and loss statements �’ These are easy to pull if you use accounting software. If not, be sure to enter the expense items in the business page of the tax organizer your accountant sent you.
  • 1098s �’ You should have received these if you paid mortgage interest on a loan secured by real estate used as a rental property or residence.

10 Ways to Save money on Tax Preparation

We’re not talking deductions and tax credits. Instead, there are many ways to save money when preparing your taxes, from online programs to coupons and business discounts. Here are a few of the best ways to save some dough when filing:

• Tax software companies �’ If you’re financially savvy, tax preparation software may be for you. Many can be used for a fraction of the cost of an accountant, but you run the risk of missing important deductions and credits. IRS.gov lists more than 20 FREE software companies that may be useful if you earn less than $58,000.
• Financial institution discount �’ Many banks and credit unions offer preparation services or software discounts to their customers.
• Check coupons and coupon codes �’ Search sites like CouponCabin.com or CouponWinner.com before purchasing tax software. You may also be able to find coupons for preparing services.  However, many of these expire before April, so be sure to plan ahead.
• Group discounts �’ Many times, preparers and software will give discounts for multiple family members using the service.
• Referral offers �’ Some preparers will offer a discount when you refer multiple friends or family members.
• Avoid the rush �’ Many tax preparers offer discounts for those who file earlier in the season, as well as after April 15. Keep in mind, though, you’ll need to file an extension if you choose the latter option.
• Combination packages �’ Some tax preparers are offering a combination plan where you can do your taxes online, then bring it into the office to have it checked by a professional. On average, this can save you $75-$100.
• Social networking �’ Many businesses have begun using social networking to promote their services and offer special deals. For example, a small accounting firm on the east coast is using LinkedIn and Facebook to advertise deals.
• Unemployment package �’ Many businesses are offering a discount rate if you or your spouse lost a job during 2010.
• Senior discount �’ If you’re a senior, be aware of the discounted or sometimes free tax preparation services. The same goes for low- to middle-income families.

5 Benefits of Using a Tax Professional

If you’re self-employed, own your own business, or have more to consider than a salaried job and rent, using a tax professional instead of online software could work to your benefit.

The IRS reported about 60 percent of Americans use a tax preparer to help with their yearly tax filing. Why? Because according to many surveyed, tax professionals are better able to offer insight into possible credits or deductions you’re missing, unlike most tax software.

Here are some of the most common benefits:

• Proper guidance �’ Tax professionals are able to provide guidance with unfamiliar terms and forms you may come across while filing. The Unincorporated Business Tax Return? The Small Business Act? Tax professionals can explain all of it.
• They can point out missed deductions �’ Perhaps you’re not including clothing donations as a deduction? Or, maybe you forgot about those miscellaneous advertising costs? A professional can help ensure you’ve included all of these in your return.
• They can recommend adjustments �’ Trained tax preparers can recommend adjustments to home offices or shared workspaces that software programs may not.
• Overall “big picture” recommendations �’ Tax professionals will look at your income, expenses, and situation, and can recommend ways for you to save money in the future.
• Audit assistance �’ In the unlikely event you get audited, an accountant can help prepare you for an audit, and can even be present during the audit.

Consider all of the above guidelines when filing your taxes this year �’ they’ll help save you time and stress in the long run.

About the Author:

Pam King empowers personal finance geeks to save money on their tax preparation costs through research, education and careful decision making.

This can certainly be a welcome boost to your bottom line, but it’s not the fact you are getting money that helps, but how you use it. Treat your tax refund carelessly and you might as well have not received any money at all.

So, what are people planning on spending that tax refund on? Capital One has done a survey and the results may be kind of surprising:

• Everyday expenses: 23%
• New clothes: 11%
• Vacation: 6%
• Computers/electronics: 4%

Yikes! There are a lot of people relying on this money to cover the daily bills, and that isn’t out of the ordinary given the high unemployment and economic climate. But the next highest item on the list is new clothes. I don’t know about you, but when I’ve been out in public I don’t get a sense that people are wearing raggedy old clothes and desperately need some money to update their wardrobe. Obviously, moving down the list we all know that spending money on vacations or electronics isn’t a very wise use of money, but big-ticket items are always a target for those tax refunds.

What is most shocking is the survey reports that only about 5 percent of those getting a refund will save the money for either retirement or college. And guess what? Those 5 percent are probably the ones who need to save money the least since they are likely already regular savers. Instead, those blowing money on new HDTVs or an expensive vacation are likely to have even less saved.

How Not to Spend Your Refund

Gambling �’ I’m sure this goes without saying, but when you get that refund check in-hand don’t rush out to the casino with dreams of doubling your money. We all know that gambling is a losing game, but when you get what feels like “free money” it’s easy to have less emotional attachment to it and you may be more apt to blow it on a night of fun. Resist the urge.

Electronics �’ As much as you want one, don’t buy an iPad, HDTV, or fancy new computer. Here’s the thing. If you couldn’t afford one of these items before the tax refund padded your bank account, you can’t afford one now. Just because the money is available it doesn’t make it a green light to spend. Beyond the initial purchase price you have to keep in mind that many gadgets have ongoing costs that really add up. That new iPhone or iPad will cost you hundreds of dollars a year in fees, a new TV or gaming system will mean spending more time being less productive and may entice you to splurge for more expensive programming or monthly subscriptions, etc.

Vacation �’ Again, if you couldn’t afford a vacation without the refund, you’re really not in a financial position to be taking that kind of vacation to begin with. We all need time away from work and as a whole workers in this country don’t take enough time off, but a large tax refund shouldn’t be the reason you take one. If you want to go on vacation, by all means do so, but don’t think of the tax refund as a means to do something far more extravagant than you would otherwise. If you do, that money is just going to burn a hole through your wallet in just a short week or two and likely just go to an airline or hotel chain and a few weeks after returning you will have forgotten all about a few of the added perks that cost you an arm and a leg.

A new car �’ If you absolutely need a new vehicle because yours is broken down and you have to rely on others to get around, then maybe you should spring for some new wheels. But don’t use your tax refund as an incentive to go buy a new car. Owning a car is incredibly expensive, and while a few thousand dollars to go towards a down payment can ease the pain a bit, you’ll still be laying out a ton of cash over time on things like gas, higher insurance premiums, and maintenance. If you are going to buy, shop smart so you can save money.

On nothing in particular �’ This one gets people more often than they realize. Many people get their tax refund and don’t rush out and spend it on any one big ticket item and instead it just goes into their checking account and sits. If you aren’t blowing it on something you don’t need that’s a good thing, right? Well, not always. In cases like this the money may sit idle and slowly get sucked out of your account without even realizing it. If you don’t do anything in particular with the money it will just get whittled away and before you know it you’ve spent an extra few thousand dollars and don’t even know where it went.

The Wrong Way of Thinking

The problem with the tax refund is that people usually think of it as an unexpected bonus. For eleven months out of the year you don’t think twice about taxes, but every spring you sit down to do your taxes and get excited to see a nice chunk of money coming your way. Then your mind wanders and you think about where you can spend it. The money is spent before it even hits your bank account.

Remember, this isn’t a bonus. This is simply Uncle Sam giving you your own money back that you otherwise could have already had in the bank. I know the financial world beats us over the head with this every year, but you really should strive to get as little of a refund as possible. It gets repeated because it’s true and it’s so easy to rectify.

Think about it. If you are one of the nearly one out of four people who will spend their tax return on everyday expenses and bills, think of how helpful having an extra $250 coming in every month would have been last year. If you’re living paycheck to paycheck that can provide a healthy cushion, help you avoid any late fees, and reduce your overall stress level.

If you’re not in such a dire financial situation that extra $250 a month could still be incredibly helpful. That’s extra money that could be applied to lingering high-interest debt, it’s money that could be going into savings each month,  it could be enough to help put your kids through college, or it could pay the premiums on that life insurance you desperately need but have put off for over a decade. Whatever the case, it’s your money so don’t let the IRS hold it hostage for most of the year. Put it to work immediately and the results will pay off.

Smart Ways to Spend Your Tax Refund

The point of this article isn’t to make you feel bad about how you were going to spend your refund but it’s meant to illustrate how costly it can be if you don’t spend it wisely. We do need to strike a balance between living for today and saving for tomorrow and it is possible to do both. But spending foolishly just to feel good for a short time while sacrificing your future isn’t the way to go about it. So, it’s ok to have a little fun with that tax refund, but before you blow it all there are a few smart ways to spend most of that money. In the order of importance:

Pay down high-interest debt �’ Above all else, if you’re carrying any sort of balance on a credit card you should try to tackle it with tax refund money. For starters, knocking out high-interest debt will save you a boatload of interest. A $3,000 balance on a typical credit card will cost you in the neighborhood of $500-$800 a year in interest alone! Pay off that debt and you basically just made money. In addition to saving money on interest you also immediately improve your monthly cash flow. A lower balance or no balance at all means a lower or no monthly payment on that debt going forward. Now you have more money to spend each month.

Pad emergency savings �’ This is probably the least sexy way to spend a tax refund, but it’s so important to have an emergency fund. If your debt isn’t much of an issue but you don’t have at least a month or two worth of expenses saved up you really should. Creating an emergency fund is about as exciting as paying insurance premiums, but it pays off more than you can imagine in a time of need. Nobody wants to think about using emergency money, but things can and do happen and if you’re able to pay for it stress-free and not rack up debt to get you through a bind you’ll realize how important it is. You can start by opening a high-interest savings account and put your money to work for you.

Retirement savings �’ Almost everyone needs to save more for retirement because as a whole, this country isn’t saving enough. If you don’t have a mountain of credit card debt and have some money set aside for an emergency and you aren’t already maxing out your retirement accounts, you should really divert some money to the future. Sure, I’d rather spend a week in Europe or get a new plasma HDTV than plunk a few thousand into my IRA, but I have to remind myself of the future. If you’re younger, time is one of your greatest assets, so putting that money to work today will go a long way in providing a better future. Oh, and if you divert your tax refund into a Traditional IRA or 401(k), you’ll get a tax break on your tax refund as an added bonus.

Other savings goals �’ If you’ve got the three previous items pretty much under control, then think about your other miscellaneous savings goals. Things like saving for college, buying a new car, or a planned purchase of a home. A little bit goes a long way when it comes to college savings, and down payments are more important than ever when it comes to borrowing for big ticket items.

Invest in yourself �’ Finally, investing a little in yourself can provide the greatest return of all. If you feel as if you’ve been stuck in a rut or your career is sucking the life out of you, spend some time and money to see how you can improve your quality of life. Find a way to strike a better work-life balance, take a few days off to get something done you’ve been meaning to do for ages, or maybe even attend some continuing education or enrichment classes. For example, if you’ve always wanted to take up photography as a hobby but never knew where to start check your local community college. Most offer night classes for subjects like that for little more than a few hundred dollars and it will get you out of the house and experiencing something new.

It’s all about the IRA contributions. One of the benefits of IRAs is that you have up until the tax filing deadline to make prior year contributions. So that means between January 1 and April 15 (or whenever the deadline falls) to make a contribution to your IRA that counts toward the prior tax year. This can be especially helpful if you’ve sat down to do your taxes and find that you owe Uncle Sam a little money. Rather than just paying the IRS you could pay yourself by making a traditional IRA contribution and then reduce your tax bill at the same time!

Of course, this only works if you are eligible for, and haven’t maxed out your contributions already. But if you haven’t maxed out contributions it almost always make sense to make early year contributions applicable to the prior year. If it’s a traditional IRA that can reduce your tax bill that’s great, but even if it’s a Roth IRA it still keeps your current year contribution limit intact so you can contribute the full amount going forward if possible.

IRA Contribution Limits

As a reminder the IRA contribution limits are as follows:

If you are under 50 years of age: The maximum contribution that can be made to a traditional or Roth IRA is the lesser of $5,000 or the amount of your taxable compensation for 2011. This limit can be split between a traditional IRA and a Roth IRA but the combined limit is $5,000.The maximum deductible contribution to a traditional IRA and the maximum contribution to a Roth IRA may be reduced depending on your modified adjusted gross income.

If you are 50 years of age or older: The maximum contribution that can be made to a traditional or Roth IRA is the lesser of $6,000 or the amount of your taxable compensation for 2011. This limit can be split between a traditional IRA and a Roth IRA but the combined limit is $6,000. The maximum deductible contribution to a traditional IRA and the maximum contribution to a Roth IRA may be reduced depending on your modified adjusted gross income.

Make Those Contributions Before It’s Too Late

Once the tax deadline passes you can’t get the opportunity to make prior year contributions again, so you might as well use it. If you’re able to reduce your tax liability, all the better. But more importantly you’ll be making some serious strides in securing your retirement.

Beat the 4/18 deadline,

You May be Able to Deduct Your Moving Costs

Did you move during 2010 to relocate for work? If so, you may very well qualify for a nice tax deduction on your moving expenses. But don’t get too excited just yet, because there are a few restrictions. Even so, if you’re eligible for the deduction you should certainly seek it out. The IRS has a two question test you must pass in order to qualify for this deduction:

1. The 50 mile question. This means the distance from the new employer’s location to your old home must be 50 miles or greater than the distance to your old job. So if you lived 10 miles from work at your old job and your new office is 45 miles from your old home, you are out of luck since that is only a 35 mile differential.
   
2. Was the move due to employment? The IRS requires that you are employed full time in the general area of your new job location for at least 39 weeks during the 12 months after you make the move. This means you are allowed to switch jobs as often as you’d like after the move. And if your employer transfers you again or even lays you off, the IRS won’t hold it against you and will waive the 39-week test.

If You Qualify

Once you qualify you need to be aware of what expenses can be deducted and which ones cannot. Generally speaking, deductible expenses are those directly related to the move such as packing material, boxes, insurance that protects items during the move, the cost of traveling to your own home one-way, and lodging costs with the exclusion of meals. If there are costs associated with disconnecting and reconnecting utilities from your old or new home, these are also included. The expenses it does not cover are those directly related to the sale or purchase of your homes. This includes, but is not limited to: closing costs, security deposits or if moving to a new state, vehicle registration or license costs.

If you’re self-employed, the rules are a little different. If you’re self-employed and move, you must first meet the deadline, but you must also work full-time at your place of business for 78 weeks in the first two years. They don’t have to be consecutive, but you will have to wait two years and make sure you have enough work in so that you can go back and claim the deductions.

Keeping Track of Expenses

Even if you aren’t sure if you’ll qualify, when it comes time to move, it pays to keep detailed records of all related expenses. So, keep those reciepts, and pay attention to all of the little things that add up. Moving can be a costly event, and there are a lot of little things you might not even think about.

As always, this might be something worth having a tax professional help you with. While it isn’t an overly complex issue, there might be things you overlook, or something that may snag your claim. Sometimes, the professional assistance can save you even more money or keep you from an audit. You can also do your taxes with the assistance of tax preperation software and it can walk you through the process.

For more detailed information and the form required: IRS Form 3903.

Typically driven by the desire to obtain a fraudulent refund or the need to prove eligibility for employment, this form of identity theft has become increasingly common in recent years and can result in serious consequences for the victim. It’s bad enough to be flagged by the IRS for an audit, but the problems stemming from tax-related identity theft can create a whole new set of problems.

Some problems stemming from tax-related fraud include:

• Delay or denial of tax funds
• Assessment of new tax debts based on income reflected on the fraudulent filer’s return
• Loss of entitlements, such as unemployment and disability benefits
• Need to prove one’s identity to the IRS year after year
• Damaged credit history and score

ID theft expert Brian Lapidus, chief operating officer of Kroll’s Fraud Solutions, highlights the warning signs of tax-related fraud and offers some important advice for those consumers who suspect that their tax information has been compromised. At Kroll, Lapidus oversees a highly-skilled team that includes veteran licensed investigators who meet regularly with IRS agents to stay apprised of emergent tax fraud issues �’ bolstering the team’s specialized work supporting breach victims and restoring individuals’ compromised identities to pre-theft status.

Signs You May be a Victim of Tax-Related Fraud

1. You are unable to file your return electronically because the IRS is stating a prior return has already been filed that included your SSN.

Take Action:

• Submit your return by paper and include proof of SSN ownership (i.e., a registered letter from the Social Security Administration)
• Get a copy of your credit report, consider getting a copy of your credit score, and look into identify-theft credit monitoring.

2. You have received a W2 or 1099 form from a company with whom you have never been employed nor had a financial relationship.

Take action:

• Contact the company in question by phone, with a follow-up letter, to request a corrected W2 or 1099, maintaining call notes and copies of all related documentation. If receipt of document was not due to an error by reporting company, file a police report.
• Maintain records of all correspondence until you receive a notice from the IRS.

3. You received a notice from the IRS advising you of unclaimed wages or income.

Take action:

• Contact the assigned IRS agent listed on the notification. He/she will work with you to ensure that you are not held liable for any fraud-related or errant wages/earnings.
• If you do not notify the IRS of a dispute, the IRS will assume the reporting is accurate. As a result, the wages/income will be processed and the IRS will send you a bill. Continued failure to notify the IRS can result in wage garnishment or tax levies.
• Follow all instructions and provide all information or documentation to the assigned IRS agent, as requested.

NOTE: If you have been contacted by the IRS (upon receipt of a notice), but have not received timely or satisfactory assistance, you may be eligible for assistance from the Taxpayer Advocate Service (TAS). Call (877) 777-4778 for more information.