(Washington, DC) - In 2009, numerous tax filing initiatives were enacted: Taxation of compensation of military members and spouses, filing of returns by registered domestic partners and same-sex spouses from other jurisdictions and new requirements for refunds directed to a foreign account.

Following is a summary of these and other key changes taxpayers will find when they start preparing their 2009 federal income tax returns.

 

What's New in 2010:

Anacostia River and Prevention Fund: Individuals will be able to contribute to the efforts to clean up the Anacostia River. Simply fill out Schedule U, Part II, Line 3 (on form D-40) or Line 9c (on form D-40EZ).

Refund directed to foreign account (IAT): Electronic banking rules have changed. Refunds directed to an account outside of the United States will be issued on a paper check.

Payment from a foreign account (IAT): Payments originating from foreign bank accounts must be remitted via check, money order or credit card.

Taxation of Compensation of Military Members and Spouses: On November 11, 2009, President Obama signed the “Military Spouses Residency Relief Act” to prevent multiple state taxation on the income and property of military personnel serving within various tax jurisdictions by reason of military service. The act provides that a state or local tax jurisdiction cannot include the military compensation earned by nonresident service members to compute the income tax liability imposed on the non-military income earned by the service member. Any compensation earned by the spouse of the service member, while accompanying the service member to a duty station outside of their legal tax residence, pursuant to the service member’s military orders, is not subject to income tax in the jurisdiction outside of their legal tax residence.

Filing of Returns by Registered Domestic Partners from other Jurisdictions:  Individuals who are registered domestic partners or are in similar relationships from other jurisdictions will be able to file jointly or separately on a combined form for the tax year 2009.

Filing of Returns by Same-Sex Spouses who were Married in other Jurisdictions: Subject to approval by Congress, individuals who were married in other jurisdictions will be able to file jointly or separately on a combined form for the tax year 2009.

Recovery Act Decoupling: Individuals will not be able to deduct the District of Columbia excise taxes on the purchase of motor vehicles whether they itemize or take the standard deduction.

 

Standard Deduction and Personal Exemption:

• Standard Deduction – For tax year 2009, the standard deduction will remain at $2,000 for married or registered domestic partners filing separately and $4,000 for other filing status.
• Personal Exemption – For tax year 2009, the deduction for a personal exemption will remain at $1,675. The personal exemption for dependents being claimed as additional exemptions also remains at $1675.

 

Federal Forms-Paper Filers:

Taxpayers filing DC individual income tax returns on paper should no longer include federal returns or federal schedules with their DC returns.

 

New Location:

This Spring, OTR will be moving to 1101 4th Street, SW. The new location will house OTR’s customer service centers, executive office, Compliance Administration, General Counsel Office, Problem Resolution Office, Real Property Tax Administration, Returns Processing Administration, Revenue Accounting Administration, and the Recorder of Deeds.

The new location is conveniently located adjacent to the Green Line Metrorail (Waterfront-SEU). For relocation updates, please visit taxpayerservicecenter.com or call (202) 727-4TAX (4829).

E-File:

 

Electronic Filing: Electronic filing continues to be the easiest, fastest, and most secure way to receive your refund.  Ask your preparer, use packaged online software or file online through the Electronic Tax Service Center at taxpayerservicecenter.com.

Electronic W-2 Filing Changes:  OTR has implemented a modernized electronic filing W-2 process (EFW2), for employers who are required to file W-2 data electronically because they have more than 50 W-2’s to be submitted.  The EFW2 provides employers a more convenient way to create and transmit W-2 data, and eliminates outdated magnetic media which is no longer accepted. 

Electronic Payment Mandates: Non-individual taxpayers are now required to pay electronically if payment is equal to or greater than $10,000.

Customer Service:

Free Tax Preparation Assistance: Customer service representatives in the walk-in center will prepare District individual income tax returns at no cost for anyone requesting the service. Taxpayers must bring a copy of their completed federal tax return, applicable schedules, and W-2s or statements showing DC withholdings.

Office Hours:

Taxpayers requesting assistance may visit OTR’s Walk-In Center currently at 941 North Capitol Street, NE, on the first floor, 8:15 am to 5:30 pm Monday through Friday, or call (202) 727-4TAX (4829).