It’s that time of year again! Yes, you guessed it: Tax Season. Taxes are viewed as a source of stress and added work for many families. However, they often mean that there’s a chunk of change headed your way, which is never a bad thing! If you’re a parent, you need that extra money more than ever, so here are the first four items on our list of possible tax benefits that will help ensure your tax return is even better. You’re welcome!
In the majority of cases, parents can claim their children as dependents on their taxes. If you are able to claim your child, you’re entitled to a deduction of $4,000 for each child that you claim. However, if your income is above a certain limit, you will be required to reduce this amount. If you would like more information about exemptions, standard deductions and filing information, read this.
Child and Dependent Care Credit:
If you paid for the care of one or more qualifying persons in order for you to work, or look for a job, you may be eligible to claim this tax credit. In addition to children under the age of 12, other qualifying persons include spouses and other individuals who are physically or mentally incapable of caring for themselves. For more information on Child and Dependent Care Expenses, read this.
Child Tax Credit:
For every qualifying child under the age of 17, you may be able to claim Child Tax Credit. For those of you who do not qualify for the full amount, you might also be eligible for the Additional Child Tax Credit. Remember, for every child that qualifies, the maximum credit is $1,000. For additional information on the Child Tax Credit, read this and also this.
Earned Income Tax Credit:
If you earned less than $53,267 in the last year, you might qualify for Earned Income Tax Credit. If so, you could get up to $6,242 in tax credit. If you would like to know if you qualify for Earned Income Tax Credit, use the EITC Assistant Tool provided by the IRS, which helps you to determine if you, and even your children, qualify. It will also help you figure out how much credit you are eligible for. Remember, you may qualify even if you don’t have children. For more information on Earned Income Tax Credit, read this.
Tax time is a great time to review important documents!
This is also a perfect time of year to review your “important documents” and update them. Take a moment to look over your Will, Living Will, Trust, Durable Power of Attorney and Designation of Health Care Advocate. Chances are they are due for an update. The skilled family law attorneys at The Kronzek Firm can handle that for you quickly. Call us at 1 866-766-5245 to discuss your case with us. Also, please join us next time as we wrap up this short, two-part series on tax tips for parents. It will be well worth your time, we promise!