Don't Mess With Taxes

Once we're out of our teens, most of us don't look forward to getting older. But at tax time, being a taxpayer of a certain age does have its advantages.

Filers age 65 or older get a bigger standard tax deduction amount simply by checking a box on Form 1040 or 1040A.

A larger standard deduction amount also is available for taxpayers of any age who are legally blind. Again, all it takes is a quick tick of a box on their tax returns.

Today's Daily Tax Tip looks at how qualifying taxpayers can get a standard deduction that could be, in some cases, as much as $4,600 larger.

For 1040 filers, the opportunity to claim a larger deduction shows up on line 39.

Click image for a larger view.

If you file a 1040A instead, you'll find the checkboxes on line 23.

These added deduction amounts are calculated for each instance in which a taxpayer (and spouse were applicable) meets the requirements.

For example, a younger single taxpayer can claim on his 2011 return a standard deduction of $5,800. A single filer age 65 or older, however, gets a standard deduction of $7,250, an increase of $1,450.

If the older taxpayer also is blind, the standard deduction increases to $8,700. That's a $2,900 increase over the basic standard deduction amount for single taxpayers.

The chart below from the Form 1040 instructions details the larger deduction amounts for the various filing statuses based on the number of boxes checked on line 39 (or line 23 for 1040A).

Click chart for larger image.

Birthday shifting: The IRS gives filers a bit of birthday leeway in determining whether they can claim the higher standard deduction.

Tax deadlines in most filing situations are the end of the tax year. Following that logic, to claim the added deduction amount for older filers on a 2011 tax return, a person would need to have been born in 1946 or earlier.

But for purposes of the 2011 increased standard deduction for older filers, the IRS considers you to be age 65 if you were born on Jan. 1, 1947.

This is not a special change just for this filing season. Every year, the IRS provides this one-day shift so that a few more folks who just missed the deduction cut-off date can take advantage of it.

If you're a New Year's Day baby who this year is getting to claim the added deduction amount or will get the one-day bump in a future filing season, consider it a birthday present from Uncle Sam.

Eyesight considerations: The IRS also expands the definition of blind for added standard deduction purposes. You don't have to be totally blind to qualify.

You can check the blind box if you have a statement certified by your eye doctor or registered optometrist attesting that:

• Even with glasses or contact lenses, you cannot see better than 20/200 in your better eye, or
  
• Your field of vision is 20 degrees or less.

You don't have to file the doctor's statement noting your limited vision, but keep it in your tax records.

Since most taxpayers claim the standard deduction, it's a safe bet that there are lot of older and visually impaired taxpayers claiming that amount, too. If that group includes you (or an older relative), make sure you (or they) aren't cheating yourself (or themselves) out of the appropriate, increased standard deduction amount.

Remember, all it takes is a couple of checks on your (their) tax return.

You also might find these items of interest:

• Eldercare issues clarified by Tax Court
• Taking care of mom with some help from the tax code
• How your future retirement tax bracket affects
  today's Roth IRA decisions