IT’S THAT TAXING TIME OF YEAR AGAIN : INTERNAL REVENUE SERVICE LAGUNA NIGUEL DISTRICT

For fiscal year 1987

23.1 million tax returns were filed in the state of California during fiscal 1987 (tax returns for 1986). Laguna Niguel contributed 28 percent of those returns.

Based on total number of returns filed, Laguna Niguel is the fourth-largest district in the nation.

6.4 million tax returns were filed in the Laguna Niguel District.

Almost 3.4 million of those returns were from individual taxpayers (the remainder come from various types of businesses.)

Total revenues for the state of California were $101.4 billion.

Total revenues for Laguna Niguel were $20.5 billion.

$19 billion of that money came from individual income and employment taxes.

Total amount refunded to taxpayers in the district was $3.2 million.

Total refunds issued to individuals totaled $2.7 million.

Orange County residents make up approximately one quarter of the population in the Laguna Niguel District.

Estimated filing statistics for Orange County:

Total tax returns filed . . . $ 1.6 million

Individual tax returns filed . . . $ 0.9 million

Total taxes paid . . . $ 5.4 billion

Individual taxes paid . . . $ 5.0 billion

Total refunds . . . $ 0.8 million

Refunds to individuals . . . $ 0.7 million

Source: Internal Revenue Service, based on information from the draft copy of the 1987 Commissioner’s Annual Report, released in January, 1988. Facts about the new Federal Tax Laws The following deductions, credits and exclusions have been eliminated:

The capital gains deduction.

The deductions for state and local taxes.

The dividend exclusion of $100 for individuals and $200 for couples.

The political contributions credit.

The deduction for adoption expenses.

The deduction for two-earner married couples.

The Individual Retirement Account deduction is eliminated for single taxpayers with adjusted gross income of at least $35,000, or $50,000 for married taxpayers who are filing jointly, who are covered by an employer retirement plan. Those falling below these amounts are entitled to either a partial or a full deduction depending on the level of their adjusted gross income.

Income averaging.

Personal interest, such as car loan or credit card interest, will be phased out beginning this year and will be completely eliminated by 1991.

These items are now taxable in the following ways:

Unemployment benefits are fully taxable.

The first $500 of unearned income for a child under 14 years of age receives the standard deduction and is not taxed. The second $500 is taxed at the child’s rate and anything over $1,000 is taxed at the parent’s marginal rate.

The following items are deductible:

Charitable deductions for those who itemize.

Mortgage interest for loans secured by principal residences and second homes. The amount of the mortgage may not exceed the cost of the property plus the total cost of improvements. The deductible mortgage interest, which must be secured by the home, also includes the interest loans taken to pay for student or medical expenses.

Choosing a tax preparer Depending on the complexity of your return, you may or may not want to go to a tax preparer. For those who choose to do so the Internal Revenue Service has compiled the following informal tips:

Ask your friends or business associates to refer you to a good preparer.

Do not go to a preparer who claims to have some kind of an “in” with the IRS.

Find out not just how much the preparer will charge you but how the preparer will determine the fee.

SPECIAL TAX SERVICES

Deaf taxpayers with access to TV/Telephone TTY equipment may call (800) 428-4732 for free telephone assistance.

Walk-in service is available at most Internal Revenue Service offices for individual taxpayers who are preparing their own returns. It is available Monday through Friday from 8 a.m. to 4:30 p.m. at these local Internal Revenue Service offices: 34 Civic Center Plaza in Santa Ana and in the Chet Holifield Federal Building, 24000 Avila Road in Laguna Niguel. When using this service taxpayers should bring their tax packages, Forms W-2 and 1099, and any other information that would help in figuring the 1987 tax. (The IRS will not prepare individual returns, but will provide only assistance). A display with self help forms is open to the public 24 hours and is located in the south entrance of the Chet Holifield Building.

Also, taxpayers can call the IRS for help toll-free at (800) 424-1040.

To order forms only , call (800) 424-3676.

For recorded tax information, call Tele-Tax at (800) 554-4477. If you have a push button telephone you can punch in a three-digit code for the topic that you need explained. A complete list of the codes appears in the federal tax package. An operator will assist those with rotary telephones. Push-button service is available 24 hours. Rotary service is available Monday through Friday 8 a.m. to 4:30 p.m.

Source: Internal Revenue Service

Clipboard researched by Henry Rivero and Deborrah Wilkinson / Los Angeles Times