Finney's tax tips

January 28, 2009 5:44:04 PM PST
With millions of workers losing jobs and some their homes, few want to think about the upcoming April 15th tax deadline. However there is a silver lining for some.

New this year, homeowners who do not itemize may claim a property tax deduction of up to $1,000, this on top of the standard deduction.

And first-time home buyers can claim a tax credit up to $7,500. There is a catch on this one though: credit is really a loan from the government and must be paid back over the next 15 years.

And if you lost your job, you may be able to deduct many of your job hunting expenses on your tax returns.

"Any expenses related to finding a job from mailing your resume to gas you've used to go to a job interview, you can deduct so you want to carefully watch those expenses and keep track of them," said ABC financial analyst Melody Hobson.

The bad news? Job seekers receiving unemployment checks have to pay income tax on that money.

Tax Tips:

First-time Home Buyers
Homeowners who do not itemize their taxes can claim a property tax deduction of $500 or $1,000 if you are married and filing jointly, in addition to the standard deduction. First-time home buyers in 2008 may be eligible for a tax credit of up to $7,500 or 10 percent of the purchase price, whichever is less. There is an important catch to this credit though. You have to pay it back in the next 15 years, in equal amounts each year, which makes it more like a loan. If you take the maximum credit of $7,500, you would need to pay back $500 per year for the next 15 years. But it still helps you get some much needed cash now when the economy is so bad, and you can pay it back a little at a time as things get better.

Unemployed Can Deduct Many Job Hunting Expenses
Money you spent on creating and mailing your resume is deductible. You can also deduct expenditures for career coaches and headhunters. You can deduct long distance or cell phone charges related to the job search, as well as travel expenses incurred for interviews, including mileage. You can deduct the portion that exceeds two percent of income.

Commonly Missed Deductions
Teacher book credit: teachers who paid for books or other classroom supplies can deduct up to $250. College tuition credit: parents who paid their children's college tuition in 2008 can deduct up to $4,000. Clean fuel credit: if you bought a hybrid car or truck you're eligible for a conservation tax credit of between $250 and $1,000. Depending on the make of the car you could get a fuel economy credit of between $400 and $2,400.