Liberty Tax Service's 8 Things to Check Before Sending Your 2004 Return to the IRS

VIRGINIA BEACH, VA (Friday, February 18, 2005) - Are you aware of recent tax changes that may give you a break? Could you be overlooking deductions you are entitled to claim? Liberty Tax Service reminds you of these things to do before filing your 2004 return:

See if you might be overlooking deductible medical and dental expenses. Although you can deduct only the part of these dental expenses over 7.5% of your adjusted gross income, there are many medical and dental expenses that may qualify. Eye surgery, stop smoking programs, and weight loss programs may be deductible.

You might qualify for tax breaks for qualifying higher education expenses. Tuition and fees paid for yourself, a spouse, or a dependent can be deducted. Up to $4,000 of these expenses are deductible as an adjustment to income. Taxpayers repaying a student loan can deduct up to $2,500 of their student loan interest as an adjustment to income. Students may also qualify for the Hope or Lifetime Learning Credit.

Are you a teacher or educator? Teachers will be able to continue claiming the $250 deduction for out-of-pocket classroom supply purchases again this year.

“Earned income” now includes combat pay for those military families who may qualify to claim the earned income credit and the refundable additional child tax credit.

Taxpayers can take now advantage of a new deduction for state sales tax if they itemize deductions. Those living in states with state income taxes can choose to deduct whichever tax bill is higher: their income taxes or state sales taxes.

Did you finance your home at a lower interest rate in 2004 ? Homeowners who refinanced their homes in 2004 cannot deduct all of the “points” on their 2004 return, but may deduct them over the life of the loan.

Do the math-again! The IRS continues to rank incorrect math as one of the biggest mistake taxpayers make.

If you’ve discovered that you have overlooked deductions or credits, you can file an amended tax return, Form 1040X for up to three years back.

Liberty Tax Service has 1735 offices operating in the United States and Canada in 2005. The company provides free tax advice and free checking of self-prepared returns at each office. In January 2005, Entrepreneur magazine ranked Liberty Tax Service as #15 on its Franchise 500 overall list of best franchises.

Accounting Today magazine ranked Liberty fastest growing on its list of top 100 tax & accounting companies released in March 2004. Liberty Tax Service is ranked for the second consecutive year on Inc magazine’s 500 23 nd annual ranking of the fastest growing private companies in the United States (Fall 2004). The Liberty Tax Service web site is www.libertytax.com

For More Infromation Please contact:
Martha O’Gorman
Vice President of Marketing
Phone: (800) 790-3863
Email: martha.ogorman@libtax.com

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