2010 Tax Tips from H&R Block 

• If you own your business, 100% of the premiums you pay for the health insurance plan can be deductible as an adjustment on your individual return. Even if you don’t have any employees, you can set up a health insurance plan through your business that covers you, your spouse and your dependent children. For additional tax savings, you can also set up a health savings account.

• The first $2,400 of unemployment benefits an individual received in 2009 is tax free. This provision applies only to benefits received in 2009. Normally, unemployment benefits are taxable.

• Taxpayers can claim a non-resident alien relative as a dependent in some circumstances, even if the relative does not live in the U.S. If the relative is a resident of Canada or Mexico, an exemption may be allowed if the taxpayer contributes more than half the relative's support and the relative earns less than the exemption limit ($3,650 in 2009).

• If you adopt a child, you may be able to take a tax credit for qualifying expenses related to the adoption, including legal fees, airfare and other travel expenses, and notary costs.  The credit could reduce your federal tax liability by as much as $12,150 for any type of adoption, and your state may allow a credit as well.

• With foreclosures on the rise, the Mortgage Debt Relief Act could provide tax relief for homeowners who had mortgage debt forgiven. The legislation protects eligible taxpayers from paying federal income tax on as much as $2 million of debt forgiven on a principal residence.

• If you bought a home in 2009 or plan to in 2010, you may get some tax relief. First-time homebuyers can get a tax credit of up to $8,000 and repeat homebuyers may be eligible for a credit of $6,500.
 
• Did you know that you can deduct the sales tax paid on up to $49,500 of the purchase price of a new vehicle bought in 2009? This is helpful particularly if you are taking the standard deduction on your tax return. In that case, remember you can add the sales tax to the standard deduction.

• If you changed your name after getting married, don’t forget to apply for a new Social Security card. This will help prevent any delays in the processing of your tax return.  

*2010 Tax Tips provided by H&R Block*