Get income tax refunds with Saving Bonds
Posted on 21. Feb, 2011
The Internal Revenue Service department encourages taxpayers to save and also provides them with incentives to do so. Greater saving would mean greater money pumped back into the economy which will give it a big thrust forwards. As every year many taxpayers get refunds on their income tax returns and already decide on what to do that money. IRS encourages taxpayers to save this money and buy saving bonds out of it. There is double benefit of buying saving bond with your income tax refund; first, it will be a good utilization of your money and second, that it can give you further rebate on your tax liability.
Starting this year a taxpayer is allowed to not only buy these saving binds in his/her name but also in name of two other individuals apart from themselves. Taxpayers have also been given the option to designate a co-owner of these bonds. In past taxpayers were only allowed to buy these saving bond in their respective names. IRS has also made necessary changes in the form 8888 to accommodate new space for additional information regarding co-owners and other designated persons. Taxpayer while applying for these bonds will have to mention the name of these persons so that they can receive these bonds directly.
While filing the return using form 1040 taxpayer use form 8888 to allocate or split the fund amount. The inertest rates of these bonds are adjusted every six months and are based on the prevailing inflation index.
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