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I'm really trying to the best method for highest return on when i file my taxes.(like most of us i assume).Not sure if i should itemize or file standard.
Here's the numbers for 2007 if anyone can tell me which method is best.
a)Family of 3 (myself-employeed,wife-never employed,son-1 year old)
b)Lived in NJ jan-may gross income-$15500,moved to Texas collected umemployment(may-sept)-$12000,then worked(oct-dec)$12000.=$39,500
c)NJ Home mortgage interest paid $5400
d)NJ home property tax paid $5600
e)Paid off student loan $13000,interest paid on loan $800
f)moving out of state expenses $2000
g)Medical expenses;$300
h)Donations:$500
Is it best to itemize or file standard?
Since wife didn't work,should i file seperatetly or jointly?
(I heard if you file jointly you have to have more then 10,000 of itemizations where if i file seperate then only 5,000.)comments on that too please thanks.
just looking at this quick, it looks like your deductions add up to more than 10,700 (married filing joint std deduction). Probably best from what info you've given to itemize....
thanks for the reply guys.From the numbers presented ,aprox how much should i be getting back if i itemized?
I used 'TaxAct' online software and from what they say i should get back aprox $2600 filing standard.
thanks for the reply guys.From the numbers presented ,aprox how much should i be getting back if i itemized?
I used 'TaxAct' online software and from what they say i should get back aprox $2600 filing standard.
I don't think you'll get that much more if you itemized, however its still something.
Itemizing is always the preferred method. However the decision to itemize is best made at the beginning of a tax year, not after the tax year is completed.
After a tax year is completed, and we are looking back at that previous year, it is too late to then decide how you are going to spend your money during the tax year.
Tax planning must be done before the tax year is completed.
After a tax year is completed all you can really do is to try and fill the forms each method, and see which way works better for you.
Probably be worthwhile to itemize.. just looking at your Real estate taxes and mortgage interest, you are at about the level of standard deduction.
I don't know about New Jersey, but if I had to bet, I would bet they impose a state income tax on your earnings there -- maybe local (i.e. city) taxes as well. Don't forget those on your Schedule A.
As for filing status -- definately jointly - because 12000 of your 39000 income is unemployment, you should qualify for the earned income credit (EIC). EIC is available for every filing status other than MFS.
Also, the newly enacted economic stimulous package requires tax payers to file a 2007 return and have earned income. If you file separately your wife would not qualify for the payment.
Last edited by The Don; 02-23-2008 at 06:44 PM..
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