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Earned Income Tax Credit Tips for Married Filers

First comes love, then comes marriage, then comes a baby… and the Earned Income Tax Credit?

Here’s one for the next round of Jeopardy: the Earned Income Tax Credit or EITC was designed to offset the burden of Social Security taxes paid by low to middle income working families.

And here’s one you can take to bank: if you find yourself struggling to provide for your family you may qualify for the EITC and increase your refund at tax time .

Whether you qualify, not to mention the amount of the credit you’ll receive, depends on your income and how many qualifying children you’re supporting.

Eligibility is based on your income and your filing status

First, in order to qualify, you must file your tax return as married filing jointly. Your filing status can not be filing separately.

Second, your income earned (that is, the wages you received from your job or the net profits you made from self employment), can not exceed a certain threshold.

If you’re married filing jointly, your 2014 adjusted gross income, must be less than:

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Earned Income Tax Credit Tips for Single & Head of Household Filers

The Earned Income Tax Credit can add a total of up to $6,044 to your tax refund!

Being a single parent is no picnic. Parenthood is a tough gig, especially when you’re on your own.

Raising a family on one source of income is enough of a headache. On top of that, you have dinner to cook, homework to help with, and sports games to attend. It’s clear, you have a lot on your plate and could use more money in your pocket.

Here’s something you must know: to lessen the financial burden of being a single parent, the IRS offers the Earned Income Tax Credit to qualifying tax filers.

Why Your Income Matters

The EITC or EIC is a refundable tax credit that is only offered to taxpayers who earn low-to-moderate income from their job or from being self-employed. That means if you don’t work, you cannot claim the credit.

In addition, once your income goes over a certain threshold, you won’t qualify to receive the tax credit. Continue reading “Earned Income Tax Credit Tips for Single & Head of Household Filers”

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What You Need to Know About Claiming Your Dependent Child

Here’s what you should know about claiming a dependent child on your taxes…

When filing your taxes, you’ll want to report the expenses that come along with the responsibilities of raising a child.

One way to do this is by claiming your child as a dependent. Each dependent you claim on your tax return will lower your total taxable income by one exemption. That means you’ll end up receiving a larger tax refund!

Keep in mind, however, each dependent can only be claimed by one tax filer. Additionally, the dependent you’re claiming must qualify as either of the following:

  1. a qualifying child
  2. a qualifying relative

Who is considered a Qualifying Child Dependent?

In order to claim someone as your qualifying child, he or she must meet the following criteria:

  • Be your biological or adopted child, stepchild, foster child, sibling, half-sibling, stepsibling, or a descendant of one of these
  • They are under the age of 19, or  if a full-time student, under age 24 (There is no age limit if the child is permanently disabled.)
  • Be a U.S. citizen or U.S. resident, or a resident of Canada or Mexico
  • Unmarried, or married but not filing a joint return
  • Have lived with you for at least half the year, unless absent due to illness, education, business, vacation, or military service
  • Have not provided more than half of his or her own support Continue reading “What You Need to Know About Claiming Your Dependent Child”