What you need to know about taxes in 2014 - KAIT-Jonesboro, AR-News, weather, sports

What you need to know about taxes in 2014

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JONESBORO, AR (KAIT) - Tax season is here, and before tax payers add up their expenses, they need to be aware of some changes.

CPA Brent Stidman with Jones and Company said it is better to itemize this year than in year's past.

"If you can itemize, you need to itemize because you will have a lower tax liability," Stidman.

Stidman said married tax payers can itemize if their total deductible exceeds to $12,200, and single tax payers can itemize if their total deductible exceeds $6,100.

Deductibles tax payers should calculate to reach these thresholds include charitable contributions, medical expenses, state income and real estate taxes, and property taxes.

"Gather those things and, again, if you're using a tax prep software, that should lead you through that process. If not, your prior tax return is a great guide," Stidman said.

Stidman warns taxpayers about a change in one deductible, medical expenses.

This year, the deductible increased two and a half percent.

"If you do itemize your medical deductions this year and you're under the age 65 and your medical deductions exceed ten percent of your income, you're able to deduct those. That threshold in the past has been seven and a half percent," Stidman said.

This means tax payers' refunds will be smaller.

As part of the Affordable Care Act, Stidman said Congress reintroduced a higher income threshold to pay for healthcare, which affects higher earning Americans the most.

"So those higher income tax payers could have as much as 80 percent of their itemized deductions phased out," Stidman said.

Stidman said this means these tax payers may owe thousands of dollars more in income taxes, even though they made less money this year. This, in turn, hurts charitable contributions.

"Essentially what happens is that a charitable contribution dollar given in 2013 is not worth as much as a dollar given in a prior year," Stidman said.

This year, the IRS will accept business returns on Jan. 13. The average person can file Jan. 31.

The IRS encourages all tax payers to E-File because it is the fastest way to get their refund.

To access the 2013 tax return form, visit the IRS website

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