NORMAL -- At long last, it's tax time for everyone.
The filing season began on time in January for the majority of taxpayers, but anyone claiming itemized deductions on Form 1040 or a handful of other benefits had to wait until Feb. 14 to file. That gave the Internal Revenue Service time to catch up to the late tax law changes passed by Congress in December.
"We are smack in the thick of it now," said Krista McBeath, president of McBeath Tax and Financial Services, Normal. She said Thursday her office was carrying back-to-back appointments on the hour and was booked out for two weeks.
Here's some of the hot topics facing filers this year:
Filing electronically isn't new, but it has new urgency this year after the IRS and Illinois Department of Revenue stopped mailing out paperwork entirely. The IRS cautions that only 8 percent of individuals received paper packages last year anyway, and 70 percent of filers did so electronically -- more if you count paid preparers.
But in Illinois, that 8 percent would still be more than 400,000 people accustomed to getting something in the mail. IRS spokeswoman Sue Hales said taxpayers can log on to www.irs.gov or call 800-829-3676 to get forms.
Filers can also pick them up at libraries and other public places, but the late tax law changes delayed their printing. At the Normal Public Library, the most in-demand item, the 1040 instruction booklets, usually arrive in early January but did not show up until last week, said reference librarian Pixie Freymann.
"Since they're not mailing them out, we gotta be ready," she said, adding that taxpayers, including many older ones, have been asking why the forms weren't there yet. The library now has all its forms, she said.
Income limits that prevented some taxpayers from rolling over a traditional individual retirement account, or IRA, to a Roth IRA were removed starting in 2010.
McBeath said the change led to many clients converting to a Roth IRA last year. The resulting income is still subject to tax, but taxpayers have a choice on when to declare it. You can include all of it as income on your 2010 return or defer it, declaring half in 2011 and the other half in 2012.
The right decision is "case by case," she said. If you are in a lower tax bracket now than you will be future years, or if you're expecting a sizable refund anyway, it may make sense to pay up now, McBeath said.
For lower-income families, the federal Earned Income Tax Credit has been expanded for tax year 2010. Eligibility depends on earned income and family size, among other tests. A married couple with three or more qualifying children must have earned income and adjusted gross income less than $48,279.
Last year, Illinois had more than 1 million EITC recipients, with an average credit of $2,226.
Taxpayers who weren't eligible for EITC in the past should double-check their incomes to see if they qualify now, especially if they suffered a recent job loss or cut in hours or wages, said Kathy Sweedler, consumer and family economics educator at University of Illinois Extension.
One of the bigger changes for 2011 is that the Adoption Tax Credit is now refundable, said Rolando Palacios, director of Tax Services for the Center for Economic Progress in Chicago. The center partners with local volunteers to offer free tax preparation sites in Bloomington, Normal and around the state.
As part of the health overhaul, the adoption tax credit also rose to $13,170 per child, up from $12,150 in 2009, to help offset adoption expenses. The credit also is now refundable, meaning eligible taxpayers can get it even if they owe no tax for that year, such as low-income families.
For any income level, Palacios said the best time to file is in March. The deadline this year is April 18, because of an April 15 holiday in Washington, D.C.
"The early filers are done and the last minute filers are waiting until April," he said.
The Associated Press contributed to this report.
Free tax help
What: Free tax preparation help from volunteers.
Who's eligible: Individuals with incomes less than $25,000; families with incomes less than $50,000.
When and where: Bloomington Housing Authority, 104 E. Wood St., 5 to 8 p.m. Mondays and Wednesdays and 9:30 a.m. to 12:30 p.m. Saturdays; and Heartland Community College, 1500 W. Raab Road, Normal, 5 to 8 p.m. Tuesdays and Thursdays.
Sponsors: State Farm Bank provided a $25,000 sponsorship for the Center for Economic Progress' downstate tax sites; 10 State Farm employees are volunteering as tax preparers, assistants and money managers at the Twin City locations.
What to bring: All W-2s and 1099s (if any); Social Security cards or individual taxpayer identification numbers (ITIN) for all family members; valid photo ID; copy of last year's tax return, if available; bank account and routing numbers to direct deposit your refund; property tax bill; college expenses.
More information: call 888-827-8511 or visit www.economicprogress.org