Did you get all the tax breaks you, Aore right to a parent?
If you are a parent, chances are that the tax law changes in 2012 affect you.
Several major tax cuts were scheduled to expire at the end of 2011. There was a great expectation breaks would eventually be extended to 2012, but Congress has kept us in suspense as long as possible.
Finally, on 1 January 2013, Congress passed the American Taxpayer Relief Act of 2012 (ATRA).
Thanks to ATRA, you might be able to make these extended tax breaks:
1. education credits liberalized
The American credit Opportunity Tax (TBT), a more generous replacement hope credit, provides a higher credit grades than its predecessor. You can also get more money because of the AOTC you paid or had withheld tax, which has not been authorized with the Hope credit.
2. Extension of lowered tax rate
Permanent extension of the reduced tax rate, including the tax bracket of 10% for low-income taxpayers.
3. Expand tax credit for children
The child tax credit was temporarily increased from $ 500 to $ 1,000 per child. ATRA makes this permanent increase. It also makes the tax credit permanent additional child, which in some cases means you could receive extra credit for taxes you paid or had withheld from your salary.
4. Excluding deduction of the line for tuition and expenses related to education
This arrangement reduces your taxable income, even if you don, AOT itemize your deductions . In addition, reducing your adjusted gross income, it can help you receive additional tax relief.
5. Higher child and dependent care credits
You can take the credit based on up to $ 3,000 of child care expenses, or $ 6,000 if you have two or more children. Depending on your income level, you may be able to take credit for a maximum of 35% of these expenses (up 30% if extended benefits had not been extended).
6. Deduction for mortgage insurance premiums
Most owners, who have to pay mortgage insurance premiums, usually because they have capital below 20 % in their homes, can continue to deduct the premiums as well as the mortgage interest deduction.
7. penalty relief marriage
The, Äúmarriage penalty at refers repeatedly in the tax law where a married couple is treated less favorably than two single people. relief marriage penalty aims to remedy this; for example, setting the standard deduction for married couples to exactly twice the level of single filers. ATRA extends these remedies.
8. expanding adoption of credit
If you have adopted a child, the maximum amount you can claim a credit is higher than it would have been if the changes had expired. You can take a dollar for dollar credit for up to $ 10,000 in adoption fees. If you adopt a child with special needs, you can take the maximum credit, even if you spent less than that amount on the cost of adoption.
In addition, there are dozens of other tax benefits that were due to expire in late 2011.
most extensive donation arrangements, AOT force you to do something to draw left. The extended credits, deductions and other calculations are integrated into TaxACT . You enter your information in Step by Step sections, and we'll do the rest.
Other tax provisions can not help you if you know or are asked about them. For example, you must enter your adoption expenses and indicate that you have adopted a child with special needs, if true, to take advantage of the expanded adoption credit. Similarly, you can still deduct mortgage insurance premiums, so be sure to find them before preparing your return.
How many tax breaks you take advantage of this year that are related to your children?
photo credit: Evil Erin photopin via cc
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