Posts Tagged ‘Earned Income Tax Credit’

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Lighten Your Tax Load:

In Accounting & Finances,Business,Taxes on June 1, 2014 by Sufen Wang Tagged: , , ,

5 Credits to Reduce What You Owe

TaxTime_lgIf you’ve been around for a couple of decades, you probably owe lots of people lots of different things. Some debts can be measured in dollars, while others can’t even be put into words, and many will never be paid off. We all keep moving down this uncertain river as best we can, trying to keep our feet from getting too wet. But owed taxes are cut and dry: pay them, on time, so you don’t get swamped. Tax credits help take a load off the amount of taxes you owe. And with some credits you may still get a refund, even if you owe no tax.

Write The Earned Income Tax Credit in permanent marker on the back of your hand. Then start filing your 2013 tax return. You don’t want to miss this refundable credit for people who work without earning a lot of moolah. The EITC can boost your refund by as much as $6,044. Eligibility depends on your income, filing status, and the number of children in your family, but single workers with no dependents may also qualify for the EITC.

MH900435055Kids are lovely bundles of joy, but they’re also a lot of work. For each qualified child (under age 17 in 2013) you claim on your tax return, The Child Tax Credit can reduce the taxes you pay by up to $1,000. Then you can use that money saved to take everyone to Disneyland.

Speaking of work, a 9 to 5 job keeps rolling even when the little ones don’t have to go to school. (All this makes you wanna’ be a kid again, huh!?). The Child and Dependent Care Credit helps you offset the cost of daycare or day camp for children under age 13. But this credit isn’t just for kids – you might also be able to claim the costs of care for a disabled spouse or dependent.  

fat-piggy-bank-webThe Saver’s Credit is strictly for those individuals who have their sights set on the future. No, this is not a tax credit for fortune tellers: the Saver’s Credit actually helps workers save for retirement. If you made $59,000 or less in 2013 and contributed to an IRA or retirement plan at work, you could be eligible for this one.

MCj038257700001This credit’s been mentioned several times before, but important things bear repeating, and college students are especially important (just ask them). The American Opportunity Tax Credit helps you offset college costs and is available for four years of post-secondary education. It’s worth up to $2,500 per eligible student enrolled at least half time for at least one academic period. The only way you can get it is to file a tax return and complete Form 8863, Education Credits. What’s that noise? Oh it’s just the American Opportunity Tax Credit knocking – and it sounds like money.

Sufen Wang, M.S.Accountancy
www.sufenwang.com
Wang Solutions, Long Beach, CA (562) 856-0793
Editor: Hannah Huff, M.F.A. Creative Writing: Poetry, (626) 806-5805

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The Good Side of Taxes:

In Accounting & Finances,Business,Taxes on September 11, 2013 by Sufen Wang Tagged: , , , , , , ,

MH900407228Become a Tax Volunteer for VITA and TCE

Got some free time on your hands? Turn it into time well spent by becoming a tax volunteer for Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE). These community-based programs provide free tax return preparation for people who need tax help but can’t afford it, such as seniors and people with disabilities.

No experience in preparing taxes – no problem. As a volunteer, you’ll get special training and can choose to work in a variety of roles. For example, if you’re bilingual (or beyond!) you could be a big help to people who don’t speak English.

MH900295311If you’re a veteran – and even if you’re not a veteran – being a VITA or TCE volunteer is one way you can help out military personnel and their families. They’re already occupied with risking their lives for the country, so let’s give them a hand with their tax preparation, okay?

In other words, it’s basically a win-win situation all around. Not only will you assist others, you’ll also learn a thing or two about taxes in the process. Yup, this is your chance to learn all the insider tips about deductions and credits like the Earned Income Tax Credit, Child Tax Credit, and Credit for the Elderly. How could you say no?

MH900200391Here’s another reason why you shouldn’t decline. Volunteer hours are flexible and minimal – about three to five hours per week. That’s like only thirty minutes a day! If only work could be so short and sweet…

Volunteering doesn’t sound too bad, does it? And getting there should be a breeze. Volunteer sites are located in neighborhood centers, libraries, schools, shopping malls, and other convenient locations all over the U.S. Think about it: you could take a nice walk to the site, help out some folks with their taxes for an hour, and then head home for dinner glowing from knowing you did your good deed for the day.

And you’ll be making history. As a VITA or TCE volunteer, you’ll become part of a program that’s helped people file tax returns at no charge for more than forty years. “It’s people helping people.”

MH900056116Ready to sign-up? Volunteer programs are open from mid-January through the tax filing deadline (April 15, 2014). Right now you should head over to IRS.gov and type “tax volunteer” in the search box for more info. The final step is to submit Form 14310, VITA/TCE Volunteer Sign Up, by email through the IRS website. Then you’ll be on your way to making the world a better place.

Sufen Wang, M.S. Accountancy
Wang Solutions, Long Beach, CA (562) 856-0793
Editor: Hannah Huff, M.F.A. Creative Writing: Poetry, (626) 806-5805

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Get Credit Where Credit is Due:

In Accounting & Finances,Business,Taxes on April 25, 2013 by Sufen Wang Tagged: , , , , , , ,

MH900039005Five Tax Credits to Reduce Your Taxes

Now that the tax deadline, April 15, had passed, and tax extension had filed; let us start working on your returns, shall we?!

Give yourself credit for all your hard work in 2012 – tax credit that is…. A tax credit reduces the amount of tax you mu pay, which is always a good thing!  A refundable tax credit is doubly god because it reduces the amount you must pay and it could also result in a refund. So, before handing in your tax return just yet – do your homework and see if you are missing out on some extra credit.

If you worked, but didn’t earn a lot of money last year – less than $50,270 – the Earned Income Tax Credit may be your perfect match. Eligibility is based on earnings, filing status, and eligible children. The EITC Assistant Tool does the math for you to see if you make the grade and approximately how much credit you’ll receive. The more kids you have, the better: the maximum you can get is $5,891 if you’re a worker with three or more children.

MH900446562Speaking of children, everyone knows it’s a full-time job raising kids. One of the perks, other than the joy of seeing them grow up, is a little thing called the Child Tax Credit. This credit can reduce your income tax by up to $1,000 for each qualifying child under age 17 that you claim on your return.

MH900198327And even when the kids leave the nest for college, you can still get credit for your parenting skills with the American Opportunity Tax Credit. This applies to the first four years of post-secondary education with the maximum credit at $2,500 per eligible student and 40% of the credit (up to $1,000) being refundable. This should offset some of the pain of paying full tuition for that out-of-state private university that your son or daughter just has to go to because it has the best sports teams.

Or maybe you’re stuck between a rock and a hard place: you have somebody who depends on you, like a disabled spouse, dependent, or qualifying child under age 13, but you need to work to support them. If you paid for their care so that you could work or look for employment in the meantime, the Child and Dependent Care Credit could cover up to 35% of those care-taking expenses.

MH900200427Finally, this one is dedicated to those individuals out there who think ahead. The Retirement Savings Contributions Credit, a.k.a. the Saver’s Credit, helps low-to-moderate income workers save for retirement. To qualify, you must contribute to an IRA or a retirement plan at work and your income must be below a certain limit. And the credit is in addition to any other tax savings that apply to retirement plans. Now let the credits roll! 

Sufen Wang, M.S. Accountancy,

Wang Solutions, Long Beach, CA (562) 856-0793

Editor: Hannah Huff, M.F.A. Creative Writing: Poetry, (626) 806-5805

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Free Tax Support for Our Troops….

In Accounting & Finances,Business,Taxes on March 23, 2012 by Sufen Wang Tagged: , , , , , , ,

Military personnel tax themselves to help their country, so their country is helping them with free tax return preparation assistance. The Volunteer Income Tax Assistance program provides low-to-moderate-income soldiers and their spouses with free tax advice, tax preparation, and return filing. And our troops don’t have to travel far for this help: VITA sites are located everywhere, from libraries to shopping malls. This means less time fighting numbers and traffic, and more precious time with their families. 
 
The Armed Forces Tax Council is the name to know for military-related tax problems. It doesn’t matter if you’re a soldier on land, sea, or in the sky: the AFTC directs military tax programs worldwide and has program coordinators for the Marine Corps, Air Force, Army, Navy and Coast Guard. With VITA, they provide volunteers who are ready to help you solve common tax issues and also answer any military-specific tax questions you may have. These are the people to ask about combat zone tax benefits or Earned Income Tax Credit guidelines. Just head to a military-based VITA site with all of your relevant identification and financial information. 
  
Things can get a little hectic while protecting the country and filing taxes might be the last thing on your mind. There are filing extensions that the military personnel need to be aware of and take an advantage of.  Check out the Extension of Deadlines section of the Armed Forces Tax Guide, Publication 3, along with the extension Form 4868; these documents will provide some breathing room for our military families. The IRS is doing what it can to make taxes as painless as possible for our troops. 
 
On the Money,
Sufen Wang
Wang Solutions
 

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Filing Taxes is a Good Thing…..

In Accounting & Finances,Business,Taxes on February 17, 2012 by Sufen Wang Tagged: , , , , , , ,

When and Why You Should File
 
Tax season is in full bloom with preparer commercials flooding the air waves and “Tax Filing This Way” signs being waved on every corner. The good news is that some of you out there won’t need to go through the hassle of filing this year. The bad news is that if you don’t file a return, you’ll have no chance of receiving certain tax credits.
  
As a U.S. Citizen or Resident Alien, you only have to file if you made a certain amount of money in 2011, and that amount varies based on your age, your filing status, and the type of income you received. Let’s say you were under 65 years old at the end of 2011, single, and made over $9,500 last year.  You earned more than the minimum gross income, so you must file a return. However, if you are under 65, married, and want to file jointly with your spouse, you need to do so only if your gross income was at least $19,000. The IRS provides a handy-dandy chart with explanations for you to decide which categories apply to you. 
  
 Of course, there are all sorts of different situations that complicate these rules. Maybe you were self-employed and you made $800 last year. It might seem like a small amount, but if you earn over $400 working for yourself, you must submit a return. Or perhaps you owe certain special taxes, such as the Alternative Minimum Tax, or Recapture Taxes – once again, you’re going to be filling out a return in the next few months.
  
These are some reasons why you’re required to file, but even if none of them apply to you, you could still benefit from sending in a return. It’s the only way you can get a refund on that federal tax your employer withheld from your paycheck, or that overpayment you made on your 2010 taxes. There’s also the Earned Income Tax Credit, which is a refundable tax credit for people who worked, but barely made any money.
  
Sometimes kids are a good thing, especially when it comes to taxes. Maybe you decided to adopt last year and need help with all of the fees you paid during the process. You might be eligible for the Adoption Credit, a refundable tax credit for those adoption expenses. If your son or daughter (or both) attends college, you can offset the cost of their tuition with the American Opportunity Credit. Each student is eligible for a maximum $2,500 and 40% of the credit is refundable. It doesn’t take a math major to realize you should file a return even if you owe no taxes: you can still receive as much as $1,000 cash back for each student. So think twice before you set aside your financial records for next year – you might be missing out on the money you deserve.
 
On the Money,
Sufen Wang
Wang Solutions
 
 

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