Valuable Credits- Savings at Tax Time

Every year millions of dollars go by the waste side.  Why?  Because people don’t know to claim the credits that are available to them on their tax returns.

These are honest tax credits, no trickery here.

Working Families:

Earned Income Tax Credit (Also known at the EITC), this is supposed to help low and moderate income workers and working families.   This means you worked for someone for a wage or independent contractor (you got a 1099-MISC form in the mail).  The IRS offers a cool EITC Assistant to help you see if you qualify.  Check the correct year and have at it.  This is offered in both English and Spanish.

Families with Kids:

Child Tax Credit is available for those with children under the age of 17 (on December 31st).  This credit can be up to a whopping $1,000 per eligible child!  This is not the child care credit or the dependent exemptions.  

Credit for Child and Dependent Care Expenses are used if you  paid someone to watch your child while you work or even look for work.  Generally, if your child is under the age of 13 they qualify for this credit.  Or if a spouse or elderly parent is unable to care for themselves this credit may also apply.

Education Credit are for post-secondary education (college), but be ware there are special rules, income limits, and other trickery that congress put in here for these tax breaks.  Worth looking into as this can be a big savings at tax time.

Savers:

Saver’s Credit is for low and moderate income workers to help save for retirement.  Most people wouldn’t qualify but its worth a look.  Contributions to an IRA are required by April 15th.

Homeowners:

Energy-Saving Tax Credits are allowed for energy-saving improvements.  If these improvements are made to your main home you may be eligible for the credit.  This includes insulation, windows, exterior doors, water heaters, heat pumps, central air, furnace, or hot water heaters.  The limit on what can be deducted is only a fraction of the cost.

If you qualify these credits can save you or your family a few bucks.  Most software programs will ask you about them.

Save those records!

 

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