The Federal Tax Credits Blog

Posts Tagged ‘children’

Question: what website can tell me how much child tax credit i will earn for my children?

Answer: Are you asking about the child tax credit or the Earned Income Credit
There is no online calculator for the child tax credit, but there is for the Earned Income Credit

http://www.irs.gov/individuals/article/0,,id=96406,00.html

1-800-829-1040

Is Film Tax Credit Good For Taxpayers?

Part of your annual tax bill in Pennsylvania goes to keeping people like Bradley Cooper, Kate Gosselin and people who make TV commercials in business here. But is that the best use of your money?

Health Care Reform Video 05 – Children Dependants on the Health Plan / Small Business Tax Credit

Question: Can I be penalized for filing an amended tax return (1040)?

I am anticipating a sizeable refund (I am married with three children. We pay daycare expenses and I had some tuition expenses for going back to college). I do our taxes every year, so I am reasonably able to forecast a refund amount. Due to the AMT changes, I will not be able to file the dependent care expense form or the education credit form until February 11th. We have some bills that we need to catch up on, and I want to try to get me refund back sooner. I am thinking about NOT filing these two forms for now, and get a lower refund to pay the bills. I would file an amended form to get the rest of the refund. Is there any reason why I should consider NOT doing this? Can I be penalized? I’d doing it this way to catch up on important bills that really should not be delayed. Thank you.

Answer: The IRS will not assess a penalty if you file a return showing a higher tax liability than necessary. You are generally allowed 3 years from the end of this year’s tax season to amend your return, show the additional amount you have overpaid, and claim the remainder of your refund.

Even if the IRS expects to be ready to handle current changes on February 11, there is no guarantee they will be ready on that date. The IRS may also pay interest on the amount they are holding, if the delay is significant.

It’s perfectly acceptable to file a return claiming as much of your refund as possible, then file 1040X to claim the rest of your money you have overpaid during the year. It’s not your fault that the IRS is not ready with the forms you need to claim your money.

Five forms are affected by the delay:
• Form 8863, Education Credits.
• Form 5695, Residential Energy Credits.
• Form 1040A’s Schedule 2, Child and Dependent Care Expenses for Form 1040A Filers.
• Form 8396, Mortgage Interest Credit.
• Form 8859, District of Columbia First-Time Homebuyer Credit.

Good luck.

Help for grandparents raising grandchildren

You’ve done your job.

Considerations for Senior Taxpayers

Question: how much child tax credit do you get for a couple and 4 children and a disabled child?

Answer: There are two levels of the child tax credit. First, if you owe taxes, those taxes are reduced up to $4,000 ($1,000 per child under 17, disabled has no effect on the credit).

Second, if you did not owe enough tax to use up the child tax credit, and you had income over $11,300, then you may get some Additional child tax credit. With three or more children, the Additional child tax credit is limited to the difference of the Earned Income Credit and the Social Security taxes you paid.

Queens woman can marry – after divorce from man who con artist married in her name

A Queens woman can finally get married – now that she’s divorced from a man she never met. Sarah Benitez, 44, had her identity stolen by a Manhattan con artist who claimed her children as dependents to get a tax break.

child tax credit

Question: Tax Refund: If I claim all my exemptions, and qualify for EIC and Child Credit, can I still get a refund?

Money is tight, so I want to claim all my exemptions so the taxes aren’t taken off my check. My wife and I qualify for Earned Income credit and the child tax credit with our two kids. If I do this will I still get a refund, or will I have to pay?

Answer: How old are your two kids? The child tax credit stops the year that they hit the age of 17. If they are under that age for right now, what you want to look at is to see if your Earned Income credit and the child tax credit add up to more than what your tax liability is. If they do than you will won’t owe anything with having no taxes taken off your check (You still will have to have social security and medicare taxes taken out no matter what.). You should also look at your state tax return (if you live in a state that has a state income tax) to see if your state credits are more than your state tax liability.

School tax-credit deadline looming

This week marks a big push by Valley school districts for much-needed tax credit donations as the Dec. 31 deadlines looms.

5 Things to Know About The Child-Care Tax Credit

Question: At what income point is Child Care credit better than pre tax $5000 savings?

For open enrollment I have to decide between a $5000 maximum pretax deduction for dependent care or taking the child care credit which I understand to be between 20-30% of expenses depending on income. At 20% I do better with the pretax savings, but at 30% the credit is a better deal. How do I determine the percentage credit for my particular income level? Is there a chart I can refer to?

Answer: You can go to the IRS website and find the tables. I performed the calculation a few years ago and surprisingly enough, both options came very close to the same result. If I remember correctly, the credit might be better if you have more than one child in daycare.

Play the percentages to pay off debt

Manage spending with a 50/30/20 divvy of your after-tax income. Dear Liz: My wife and I are working to get out of debt, and I am interested in comparing the amounts we spend on mortgage, food, diapers and so on with what would be considered ideal or at least average for homeowners living in areas with a high cost of living. Do you have recommended percentages for various items? I am always …

New Dependent Rules