Federal courts have long held that expenses incurred by taxpayers for the care of dependents, such as a daycare or babysitting expense, while the taxpayer is away from home and at work, are not deductible under I.R.C. § 162(a). However, taxpayers who incur daycare expenses for their children or disabled adult dependents may be eligible for a federal tax credit of up to 35% percent of the cost of day care. To qualify for the child and dependent care credit, you must have a dependent child age 12 or younger, or a dependent of any age who cannot care for himself or herself. You may calculate your tax credit on IRS Form 2441.
Who Claims The Kids On Their Taxes, And Other Ways Divorce May Affect Your Taxes
Divorcing couples often wonder who claims the children on their taxes, and in what other ways divorce will affect their taxes. Questions may include which filing status to use after the divorce, and how payments for spousal maintenance and child support to an ex-spouse are treated for tax purposes. Also, inquiries about what happens to assets like the family residence are obviously frequently common.
Filing Status
To Be or Not To Be? Married Filing Jointly or Married Filing Separately?
Married couples have the option to file jointly or separately on their federal income tax returns. Undoubtedly, married couples during tax season have asked each other if they are filing advantageously, whether currently filing jointly or separately. The IRS strongly encourages most couples to file joint tax returns by extending several tax breaks to those who file together. In the vast majority of cases, it’s best for married couples to file jointly, but there may be a few instances when it’s better to submit separate returns.
Proving Education Tax Break Eligibility In 2016
The American Taxpayer Relief Act of 2012 extended the American Opportunity Tax Credit (AOTC) through December 31, 2017. This tax credit assists with the cost of higher education expenses such as tuition, course materials and other certain eligible fees for four years, which differs from the Hope scholarship credit because the credit may be claimed for four years instead of the two allowed under the Hope credit.
Tax Provisions Of The Trade Preferences Extension Act of 2015
As well as the trade provisions that were the bill’s focus, the Trade Preferences Extension Act of 2015 (H.R. 1295), signed into law in June of 2015, contains provisions regarding tax law. The Act revises several Tax Code provisions, and extends a number of trade agreements as well as programs like trade adjustment assistance (TAA) and the Health Coverage Tax Credit (HCTC). TAA consists of programs that provide federal job training and assistance to workers, firms, farmers and communities that have been adversely impacted by foreign trade.
TOP TEN TAX FACTS ABOUT HOME SALES
Selling a home is a stressful experiences, but when you consider all of the tax issues related to such a sale, it may be an overwhelming one. In most cases, gains from the sale of property, both personal and real, are taxable. However, the seller of a home may not always have to pay taxes. if you sell your home this year, here are ten facts to know.
BACK TO SCHOOL EDUCATION CREDITS
If you or a loved one like a spouse or child is enrolling in college in the near future, remember that there are tax credits which may reduce your tax bill. Before reviewing these credits, it is important to note that you can claim only one type of education credit per student on your tax return each year. If more than one student qualifies for a credit in the same year, you can claim a different credit for each student.
FEDERAL TAX IMPLICATIONS FOR SAME-SEX COUPLES MARRIED UNDER STATE LAWS
In June of 2013, the U.S. Supreme Court held in U.S. v. Windsor that provisions of the Defense of Marriage Act (DOMA) were unconstitutional. Prior to this ruling, Section 3 of DOMA required that, for purposes of federal enactments, marriage be defined as the union of one man and one woman and the word spouse be defined as someone of the opposite-sex who is a husband or wife.
Tax Credits for Employers Hiring Veterans by Dec 31
IRS Urges Employers to Hire Veterans by Dec. 31, Save on Taxes
Employers looking to hire sometime soon are urged to consider hiring veterans. Such hiring may entitle the employer to claim the federal Work Opportunity Tax Credit worth thousands of dollars. Employer must however act soon…the WOTC is available to employers that hire qualified veterans before the new year.
Some key facts about the WOTC include:
1. Hiring Deadline. To qualify for the WOTC, Employers must hire qualified veterans before Jan. 1, 2014. Though the credit was previously set to expire at the end of 2012, the American Taxpayer Relief Act of 2012 extended it for one year.