Unemployed last year? How to file your taxes in 2010

7:27 PM, Feb 14, 2010   |    comments
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Tampa, Florida - 2009 was a tough year for many people. Millions lost their jobs, finding themselves unemployed for the first time in their lives.

Now, a year later, those folks have to file their taxes.

Amanda Sanabria, 22, of Tampa is one of those people.

"I lost my job at the end of September, but I was optimistic. I was sure I'd be able to find a job," said Sanabria.

She did get a job, but it took four months. During that time, she collected unemployment benefits from the government. While she was grateful for the green at the time, "I knew that it was considered income and I would probably be taxed on it and I wasn't sure if any taxes had been withheld. I didn't pay close attention," said Sanabria.

Like Sanabria, if you were unemployed last year, keep an eye out for a 1099-G form in the mail from the government. That form details the amount of unemployment benefits you received and if any taxes were withheld. (If you have not received your 1099-G, click here to reprint it.)

Good news for everyone, the first $2,400 of unemployment benefits are tax-free.

"Let's say you made $50,000 that year. The average person would save $600 in taxes," said CPA Mark Braverman of Liberty Tax Service.

Braverman says he helps people like Sanabria deal with filing their unemployment benefits every day. "We are seeing so many more people wondering how to do deal with unemployment than previous years."

Braverman finds tax credits that can help offset the pain of collecting unemployment, like existing credits, that could be new to you because you went on unemployment.

"A lot of folks did not qualify for the Earned Income Credit before because they made too much money. It may take them by surprise and they may not realize they have to take care of this on their taxes. It is worth quite a lot of money to them, like $5,000 for a family with three children."

Then, there's an education credit that's brand new this year. For those of you who lost your job last year and decided to go back to school, you can file for the American Opportunity Credit and get up to $2,000 back.

That credit helped Sanabria big time, "I think $900 was refunded that I got actually back in my pocket."

Finally, don't forget president Obama's stimulus package offers a tax credit up to $800 for folks who are married and filing joint.

There are also ways to file your taxes yourself for free.

To get in touch with CPA Mark Braverman, email him at Mark.Braverman@libertytax.com.

Erica Pitzi, 10 Connects Reporter

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