The Internal Revenue Service is in the midst of a busy 2007 filing season that features telephone excise tax refunds and recently enacted tax breaks. Among the major changes you should be aware of include:

·        Telephone Excise Tax Refund. Individual taxpayers will be able to request a refund if they paid the federal excise tax on long-distance or bundled service. The government stopped collecting the federal excise tax on long-distance service in August and announced plans to provide refunds of these taxes billed after Feb. 28, 2003, and before Aug. 1, 2006. More than 146 million individual taxpayers are expected to request the refund.

·         New Split Refund Option. For the first time, taxpayers can split their refunds among up to three accounts held by up to three different U.S. financial institutions, such as banks, mutual funds, brokerage firms or credit unions. To split direct-deposit refunds among two or three different accounts or financial institutions, taxpayers should complete the new Form 8888, Direct Deposit of Refund to More Than One Account.

·         Free File Improvements. The free electronic filing program features improvements to benefit the 95 million taxpayers — 70 percent of all taxpayers — who qualify for the program. Free File, a partnership between the IRS and the private sector Free File Alliance, is available for taxpayers who earn $52,000 or less.

Recent Tax Law Enactments. Visit www.IRS.gov to get the information you need to take advantage of tax law provisions enacted in December 2006 after IRS forms went to print. This new legislation affects a number of areas of tax law, but the most significant effect on individual taxpayers involves the deductions for state and local sales tax, higher education tuition and fees, and educator expenses. HBM

Previously published in the April 2007 issue of HOME BUSINESS® Magazine, an international publication for the growing and dynamic home-based market. Available on newsstands, in bookstores and chain stores, and via subscriptions ($15.00 for 1 year, six issues). Visit www.homebusinessmag.com