Zaher Fallahi, Tax Attorney and CPA; IRS to Parents: Don’t Miss Out on These Tax Savers
Children may help you reduce the amount of taxes you owe for the year. If you’re a parent, the following are certain tax benefits you should consider when filing your federal tax return:
• Dependents. In general, you may claim your child as a dependent and deduct $3,950 for each dependent. You must reduce this amount if your income exceeds certain limits. For more on these rules, see Publication 501, Exemptions, Standard Deduction and Filing Information.
• Child Tax Credit. You may claim the Child Tax Credit for each qualifying children under the age of 17. The maximum credit is $1,000 per child. If you get less than the full amount of the credit, you may be eligible for the Additional Child Tax Credit. For more, see Schedule and Publication 972, both titled Child Tax Credit.
• Child and Dependent Care Credit. You may claim this credit if you paid for the care of one or more qualifying persons. Dependent children under age 13 qualify. You must have paid for care so that you could work or could look for work. See Publication 503, Child and Dependent Care Expenses.
• Earned Income Tax Credit (EITC). You may qualify for EITC of up to $6,143 if you worked but earned less than $52,427 during 2014. You may qualify with or without children. Use the 2014 EITC Assistant toolat IRS.gov to find out if you qualify. See Publication 596, Earned Income Tax Credit, to learn more.
• Adoption Credit. You may claim a tax credit for some costs related to adopting a child. For details see Form 8839, Qualified Adoption Expenses. Zaher Fallahi, Tax Attorney and CPA.
• Education tax credits. An education credit can help you with the cost of higher education. There are two credits that are available. The American and the Lifetime Learning Credit may reduce the amount of tax you owe. If the credit reduces your tax to less than zero, you may get a refund. Even if you don’t owe any taxes, you still may qualify. You must prepare the Form 8863, Education Credits, to claim these credits. Use the Interactive Tax Assistant tool on IRS.gov to see if you can claim them. Visit the IRS’s Credits Web page to learn more. Also see Publication 970, Tax Benefits for Education.
• Student loan interest. You may deduct interest you paid on a qualified student loan. You can claim this benefit even if you do not itemize your deductions. For more information, see Publication 970.
• Self-employed health insurance deduction. If you were self-employed and paid for health insurance, you may deduct insurance premiums you paid during the year. This may include the cost to cover your children under age 27, under the OBAMA Care, even if they are not your dependent. See Publication 535, Business Expenses.
Zaher Fallahi, Tax Attorney and CPA, practices as Los Angeles Tax Defense Attorney and Orange Tax Defense Attorney, and assists taxpayers including Americans Living Abroad and Non-Resident Aliens subject to the US tax law, in resolving their tax problems regarding their Offshore Voluntary Disclosure Program (OVDP), Report of Foreign Bank and Financial Accounts (FBAR), Foreign Account Tax Compliance Act (FATCA) and Foreign Trust. Telephones: (310) 719-1040 (Los Angeles), (714) 546-4272 (Orange County), e-mail [email protected]