Prepare for the tax deadline

Maybe the delay is intentional, a ploy to put off paying what’s owed. Other times it’s accidental or simple procrastination. But the reason for putting off filing matters not when it comes to making the deadline.

When filing, remember to check the new credits available. The American Recovery and Reinvestment Act offered a number of credits — home buyer, making work pay, American opportunity, home energy and new car tax and fee deduction.

Those who haven’t filed online, should give it a go. There are multiple services available to help. The IRS offers links to free electronic filing options on its Web site, www.irs.gov. People who make under $57,000 or less according to their gross adjusted income can gain access to a step-by-step free e-file system. Those who make more can fill out forms and file for free, but will not gain access to the same guidance.

Double-checking work can go a long way, as the most common errors on tax returns are minor.

Missing or incorrect Social Security numbers occurs often, causing delays in processing tax returns, according to the IRS. The same could be said for misspelling dependents’ name. Be sure all forms are signed and all required forms are included.

Investments can be a tricky part of taxes, but it doesn’t need to be.

Scott Lucia, of San Mateo-based Andrews Lucia Wealth Management, explained investments are an ongoing thing that should be monitored year round. Those waiting until the last minute should note a few things.

Those who sold a stock for a loss in 2009 can use up to $3,000 of that loss against their income, he said. Losses over $3,000 can counteract proceeds from the same year. Those losses never run out, Lucia explained. Basically, keep track of losses and when those losses are used in taxes.

For example, those who took a $10,000 loss could use the initial $3,000 credit, leaving $7,000. If another sold investment generated a $4,000 gain, the loss can counteract those proceeds. This leaves a $3,000 tax for a future year, he said.

Another thing to note, is some people can deduct investment expenses. If the fees are over 2 percent of a person’s adjusted gross income, fees to the advisor can be deducted, said Lucia. Be sure to keep records to prove this cost.

After filing, Lucia suggested taking a close look over the portfolio during this year. Tax cuts offered from the Bush administration end this year. Basically, capital gains from dividends are currently taxed at 15 percent. That increases next year. With that in mind, consider if the investment still makes sense for you.

For those of you who must wait until the last possible hours to get the taxes time stamped, pay attention to which locations are open late as most are not. This year only one location, the Airport Branch, will remain open until midnight.

Two locations in San Mateo County will have extended hours: Airport Branch, 660 West Field Road, San Francisco will have windows open from 11 a.m. to midnight and curbside available from 4 p.m. to midnight; Redwood City Main Post Office, 1100 Broadway in Redwood City will have windows open 8 a.m. to 7 p.m., according to the U.S. Postal Service.  

The post office warned about rushing as it often leads to mistakes, like not including enough postage, a common error. One ounce is about four pages. It costs 44 cents for the first ounce and 17 cent for each additional.

Heather Murtagh can be reached by e-mail: heather@smdailyjournal.com or by phone: (650) 344-5200 ext. 105.