If you, your spouse or dependents had significant medical or dental costs in 2011, you may be able to deduct those expenses when you file your tax return. Here are eight things the IRS wants you to know about medical and dental expenses and other benefits. (more…)
Parents, guardians and other taxpayers who are eligible to claim a child as a dependent on their tax return may also be eligible for a federal tax credit of up to $1,000 per child. The Child Tax Credit is one of serveral tax-related benefits for families and children. Remember that a tax credit is different (and in most cases better) than a deduction. The Child Tax Credit is available to “eligible taxpayers” with “qualifying children” under age 17. Be aware that there are additional criteria and not all dependents will qualify.
Amount
With the Child Tax Credit, you may be able to reduce your federal income tax by up to $1,000 for each qualifying child under age 17.
Qualification
A qualifying child for this credit is someone who meets the qualifying criteria of seven tests: age, relationship, support, dependent, joint return, citizenship and residence.
Age Test: To qualify, a child must have been under age 17 – age 16 or younger – at the end of 2011.
Relationship Test: To claim a child for purposes of the Child Tax Credit, the child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister or a descendant of any of these individuals, which includes your grandchild, niece or nephew. An adopted child is always treated as your own child. An adopted child includes (more…)
If your pay from work involves compensation through tips, then the IRS would like you to be aware of a few facts about tip income. Here are four key points to keep in mind: (more…)
The IRS has announced the availability of IRS2Go 2.0, which is an expanded version of its smartphone application we told you about here. The app is now designed to provide taxpayers easier access to practical tools and information. The new app is available for Apple and Android devices and is free.
New Features:
Many people may not realize the Social Security benefits they received in 2011 may be taxable. All Social Security recipients should receive a Form SSA-1099 from the Social Security Administration which shows the total amount of their benefits. You can use this information to help you determine if your benefits are taxable. Here are seven tips from the IRS to help you: (more…)