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TAX TIME Sharpen The Pencils And Find Those Receipts

Kathy Waters/Highlands Today

Tom Fourman looks over corporate tax documents with clients of his on Thursday at Done Right Business Services LLC in Sebring.

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By Bill Rettew Jr. | Highlands Today

Published: February 1, 2008

SEBRING — The regular annual rush to file tax returns starts this week and professional tax preparers are sharpening pencils and spending more time at the keyboard.

When most W-2s hit mailboxes, it sparks a surge of taxpayers filing for an earlier refund. Employers are required to mail or make tax information available by Jan. 31.

Tom Fourman files returns for Done Right Business Services in Sebring. He said Tuesday that 30 to 50 percent of more than 700 clients will file during the next two weeks.

"It's typical – year after year – people are strapped and they need the money fast," said Foreman.

Lisa Berish, area manager of H&R Block, said 40 to 50 percent of that firm's local customers will file during the next two weeks and then the firm will experience a lull of tax filers until the April 15 deadline looms larger.

"It's like a roller coaster," said Berish. "(The rate of filing) goes up, stays up, and then goes down, and then goes back up by April 15."

Lisa Thomas, franchise owner of Jackson Hewitt Tax Services, who oversees two offices in Sebring and two in Lake Wales, with another in Avon Park, said many early filers want to pay off Christmas-related debt and other bills.

"Some are afraid that the government is going to spend it before they can get t," said Thomas.

It takes the IRS four to six weeks to send a check when a paper return is filed – 58 percent now file electronically – and when direct deposit is used, returns are common within 10 days.

"There's a big influx of returns when the W-2s come out," said Mike Dobzinski, IRS spokesman. "People are really eager to file."

Fred Lerma and Dustin Davis, both of Avon Park, filed professionally with Fourman at Done Right Business, on Tuesday.

"I wanted to make sure I got everything out of the way, although I usually wait," said Lerma, who will likely spend his return proceeds on bills and a new CD player for his car.

Less than 24 hours after receiving all of his W-2s, Dennis filed for a refund.
He will spend the proceeds from the return on bills and new wheel rims for his car.

"It's my money, I worked hard for it. I work two jobs. It's mine and I want it."

Fourman said 10 percent of early filers request a same-day loan against their tax return. Thomas said with this popular option, a bank will often give approval to pay off on a return after receiving an IRS alert that the taxpayer is up to date, including child support or IRS loans.

Michael Dobzinski, a spokesman for the IRS in Florida, said the IRS is nearly ready for the annual deluge of early returns, except for a snag concerning Alternative Minimum Tax (AMT). Area tax pros said a simple phone call will ease what has become confusing for many.

December congressional legislation slowed an IRS response which will affect 3 million to 4 million tax returns. AMT-related returns will likely be accepted starting on Feb. 11.

The proposed Economic Stimulus Package recently passed the U.S. House of Representatives and pending in the Senate will have no bearing on any 2007 tax returns, and if checks starting at $600 are issued, they would be handled separately.

SOME DELAYS EXPECTED ON CERTAIN FORMS

If you are filing using one of the five affected forms for Alternative Minimum Tax (AMT) you won't be able to send your return to the IRS for a few weeks until the IRS computers are reprogrammed for the late tax law change. The IRS expects to be ready for these returns by Feb. 11.

• Form 8863, Education Credits.
• Form 5695, Residential Energy Credits.
• Schedule 2 (Form 1040A), Child and Dependent Care Expenses for Form 1040A Filers.
• Form 8396, Mortgage Interest Credit.
• Form 8859, District of Columbia First-Time Homebuyer Credit

Source: IRS

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