Posts Tagged ‘deductions’
Tuesday, June 8th, 2010
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The Patient Protection and Affordable Care Act and the related Health Care and Education Reconciliation Act overhauls the U.S. health care system and affects nearly all taxpayers, many employers, and many elements of the health care industry. This massive overhaul contains a host of tax changes, many of which are both complex and novel. To compound the challenge, the tax changes go into effect over a number of years – ten if two retrocactvely effective tax changes are counted and nine if they are not.
Below is a timeline of the tax changes and a concise summary of each new tax provision.
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Tags: Business, deductions, due dates, healthcare, Tax
Posted in Business, Individual, Tax | 2 Comments »
Monday, March 8th, 2010
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Got kids? They may have an impact on your tax situation. here are the top 10 things to consider if you have children.
- Dependents: In most cases, a child can be claimed as a dependent in the year they were born.
- Child Tax Credit: You may be able to take this credit on your tax return for each of your children under age 17. If you do not benefit from the full amount of the Child Tax Creidit, you may be eligible for the Additional Child Tax Credit. The Additional Child Tax Credit is a refundable credit and may give you a refund even if you do not owe any tax.
- Child and Dependent Care Credit: You may be able to claim the credit if you pay someone to care for your child under age 13 so that you can work or look for work.
- Earned Income Tax Credit: The EITC is a benefit for certain people who work and have earned income from wages, self-employment or farming. EITC reduces the amount of tax you owe and may also give you a refund.
- Adoption Credit: ;You may be able to take a tax credit for qualifying expenses paid to adopt an eligible child.
- Children with Earned Income: If your child has income earned from working they may be required to file a tax return.
- Children with Investment Income: Under certain cirmcumstances a child’s investment income may be taxed at the parent’s tax rate.
- Coverdell Education Savings Account: This savings account is used to pay qualified educational expenses at an eligible educational institution. Contributions are not deductible, however, qualified distributions generally are tax-gree.
- Higher Education Credits: Education tax credits can help offset the costs of education. The American Opportunity and the Lifetime Learning Credit are education credits that reduce your federal income tax dollar-for-dollar, unlike a deduction, which reduces your taxable income.
- Student Loan Interest: You may be able to deduct interest you pay on a qualified student loan. The deduction is claimed as an adjustment to income so you do not need to itemize your deductions.
Got kids and need more information? Contact us.
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Tags: children, deductions, Tax
Posted in Individual, Tax | No Comments »
Wednesday, January 27th, 2010
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 For 2010, personal exemptions and standard deductions will change only slightly to reflect inflation adjustments. Many levels will remain consistent with 2009.By law, the dollar amounts for a variety of tax provisions must be revised each year to keep pace with inflation. As a result of little inflation, there will be no significant changes for 2010. The following is a brief review of some of the key levels effecting 2010 returns, filed by most taxpayers in early 2011, include the following:
- The value of each personal and dependency exemption, available to most taxpayers, will remain at the same level of $3,650, no change from 2009.
- The new standard deduction is $11,400 for married couples filing a joint return in 2010 (no change from 2009), and $5,700 for singles and married individuals filing separately (again, no change from 2009. The Head of Household standard deduction increased slightly to $8,400 for heads of household (up from $8,350 in 2009). Nearly two out of three taxpayers take the standard deduction, rather than itemizing deductions, such as mortgage interest, charitable contributions and state and local taxes.
- Tax-bracket thresholds increase slightly for each filing status. For a married couple filing a joint return, for example, the taxable-income threshold separating the 15-percent bracket from the 25-percent bracket is $68,000, up from $67,900 in 2009.
- The maximum earned income tax credit for low and moderate income workers and working families with two or more children is $5,028, up from $4,824. The income limit for the credit for joint return filers with two or more children is $43,415, up from $41,646.
- The annual gift exclusion will remain at $13,000, same as 2009.
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Tags: deductions, exemptions, tax bracket
Posted in Accounting, Individual, Tax | No Comments »
