The Federal Tax Credits Blog

Posts Tagged ‘home’

Question: How exactly does the adoption tax credit work?

My husband and I are considering an international adoption. We normally overpay on our taxes and as a result get money back every year when we do our taxes. I am not sure how this works with the adoption tax credit. Will we get that much more money back? Just trying to figure out if we can financially afford it and this information would really help.

Answer: I have not verified this but, from what I understand the Adoption Tax Credit will be changing if it has not yet. The Current Rules will Expire in 2010

Families who adopted Domestically or Internationally could claim the tax credit and were required to Document their expenses in order to do so. Any Employer Adoption Credit had to be deducted from the Tax Credit.

Families who adopted children from foster care can take it without proving the expenses to adopt (since there really arn’t any)

The Tax credit was originally designed to make it a little more possible for families to Adopt Children our Taxes are already supporting. The sad thing has turned out that many families who do adopt children from Foster Care didn’t think they could claim it because they thought they had to document the expenses.

The vast amount of people who have been Claiming it are doing so for International and Domestic Private Adoption and there has been a number of Senators wanting to change the law when it renews in 2010 and only allow the credit for children adopted from Foster Care as it was originally intended.

so….as far as we know right Now the Adoption Tax Credit will ONLY apply to US Foster Child adoptions after 2010…

airline tickets flights

Question: if i recieve unemployment can i file taxes on it and still get the child tax credit?

Answer: It is hard to tell what your question really is so I will take a few tries at it.

Filing taxes is not optional if you made enough money. If your unemployment and all other income combined is over the filing requirement you are required to file whether you get certain credits or not.

Everybody that files a return and has a child under 17 gets the child tax credit. The question is whether you will benefit from it. If unemployment is your only income, you probably will not benefit from it since you probably will not have any taxable income after your standard deduction and exemptions are subtracted from your unemployment.

If you mean the Earned Income Credit instead of the child tax credit, and unemployment is your only income, then you are out of luck. The “Earned Income” in “Earned Income Credit” means you have to work to earn the money so money you didn’t work to earn, like unemployment, doesn’t count. Still time to get out and earn some before the end of the year.

Economic Professor on Recession, Unemployment & Consumer Spending

Home Insulation

Question: Help with Filing Rental Income Tax From Renting Part of my Home?

I just bought a house in 2009 and took the 8k credit by amending my 08 taxes. I had a buddy move in with me and he takes up about 60% of the house (it asks that on turbo tax). Its an older house so I made use of that 8k ( New Appliances,New Tile Flooring, Gutters, Repaired Hot Water Tank, Repaired Trash Disposal had overgrown foliage removed) I’m pretty sure all these expenses are tax deductable beyond the rent I recieved from my tenant. I have all of the receipts as well. I started doing turbo tax, would it be better to go to a professional? Will I be able to deduct all the improvments and repairs I made?

Answer: I have a similar situation and my “roommate” uses 30% of the space. I would follow the idea that only EXCLUSIVE USE space belongs to the roommate and share used or common area space is split 50-50. So your roommate’s bedroom is exclusive use and shared kitchen, bath, and living room facilities would be 50% yours and 50% roommate’s. Take the sum of square footage assigned to your roommate and divide by the total livable square footage of your home to arrive at the rental percentage. In general, just be prepared to justify the reasonable method you chose for calculating the percentage assigned to the roommate.

All improvements, appliances, etc., have to be depreciated. You will need TurboTax Premier to track depreciation. If you have no trouble following instructions and don’t hate doing taxes, you should have no trouble doing this on your own. You should also read IRS Publication 527 [http://www.irs.gov/pub/irs-pdf/p527.pdf] for more info.

Energy Star Credits – TaxMama.com