Get the most out of your tax return

LAFAYETTE, Ind. (WLFI) - In this tough economy, with layoffs and tight budgets, many people have been quick to file their taxes and receive their much needed refunds.

"We've certainly seen more people needing to get in here and have their taxes prepared and have their refunds back," H&R Block Tax Advisor Janet Sherrill said.

Sherrill said there are some credits taxpayers need to be on the lookout for, like the First Time Homebuyer's Credit.

"Purchases after the first of the year through December 1 of 2009 now apply for an increased $8,000 credit that if they stay in the home for at least three years, and it never needs to be paid back," Sherrill said.

Last year's June flooding may qualify some people for higher education tax credits. Sherrill said these are specific to Tippecanoe and other counties deemed CORE Disaster areas by FEMA.

"Education credits for people whose children attend schools in the CORE areas or counties get double the education credits. We are benefiting from the Federally Declared Distress areas," Sherrill said.

Also new, anyone who received unemployment benefits so far in 2009 may exclude the first $2,400 from their 2009 taxable income.

More and more people are going online to file their taxes. The IRS says this year alone 93 percent of Hoosiers have E-filed their taxes.

For people who owe money, but can't pay now, Janet Sherrill said it is better to file a return on time and pay later.

"Late filing penalty is worse than the late payment penalty," Sherrill said.