Tips to get your maximum refund and put more money in your pocket.
you've heard the term "Millennium" used to describe people born somewhere between 1980 and 00. If your birthday falls within this period of time, there is a good chance that you can be file your first tax return. You may also have faced major changes in your life this year, as a new job, tie the knot or even having a baby.
No matter what 2015 looked for you, there are many ways you can get back from Uncle Sam this tax filing season.
Check out these tips to help learners like you, get your biggest refund.
Earned Income Tax Credit.
If you are aged at least 25 years, the tax credit earned income (EITC) can be your greatest tax relief yet. While you might be earning a moderate income level, you may be eligible for credit more easily than you think
For example :. You may be able to get the EITC in 2015 if you are married, no children live with you and jointly earn $ 20,330 or less.
If you have a child in your home, you qualify if your income is $ 44,651 or less, with two children of her $ 49,974 or less and you file jointly and have three or more children living with you the maximum income is $ 53.267 to qualify.
your credit can be much greater than the amount you paid estimated taxes or had withheld from your salary because the EITC is a refundable credit.
any amount of credit not used after taxes you owe are paid down goes into your pocket like a refund.
The maximum EITC for 2015 is $ 503 if you have no children living with you $ 3,359 if you have a child, $ 5,548 if you have two children and $ 6,242 if you have three children and over living with you.
do you have children living with you? They can help you get a larger refund.
Most people know they can take a dependency exemption for their children. However, this is not the only way that your children can help save you at tax time.
You may also be eligible to take the child tax credit for up to $ 1,000 per child under 17 years at the end of the year.
The credit begins to eliminate when your income exceeds $ 75,000 ($ 110,000 if filing jointly). For taxpayers in the lower income brackets, this credit may be refundable.
Having children can make a big difference in whether you qualify for the EITC and how much credit you receive.
A child must live with you for the EITC count, which means that if the child's other parent takes the dependence of credit for your child, but the child lives with you, always ask the child for the EITC.
you can also qualify to claim the adoption credit if you adopted a child or adoption expenses paid during the year.
again, if you paid care expenses and child care, you may be able to benefit from support in the appropriations for children.
education credits.
If you are still in college or back to school, education credits can significantly increase your tax refund. Currently there are two education credits -. The American Opportunity Tax Credit and Lifetime Learning Credit
The American opportunity credit applies to your first four years of college. There is a good deal - you get 100 percent of your first $ 2,000 in tuition and other credit spending and 25 percent of the next $ 2,000. This comes to a total of up to $ 2,500.
You must use the Lifetime Learning credit if you do not qualify for the American opportunity credit.
For example, it would be a good option if you have already made more than four years of college or take a few night classes after work.
in this case, you may qualify for a credit of 20 percent up to $ 10,000 in education fees, which equals a maximum credit of up to $ 00.
Use the best filing status for your situation.
filing status you choose for your tax return may seem obvious, but it's not always the case. The status of the most common mistake people deposit is to assume, if they are single, they must still use the single filing status.
If you support someone else and maintain a household, for example if you have a child, you may qualify to file as head of household - which may be more advantageous filing status. You may even be eligible to file as head of household if you are married, but "considered unmarried" because your spouse did not live with you the last six months of the year.
If you have a child and your spouse died there less than three years, you should see if you are eligible for widow (er) With the child qualification status.
With this filing status, you can use joint return tax rate and the amount of the deduction at the highest level. Eligibility for this filing status is for two years after the year of death of your spouse.
If you are married, your best bet may be tax filing as Married filing jointly. Some tax benefits are limited or not allowed when using the filing status Married separately.
However, there are always exceptions. For example, if the combination of your income makes the amount you earn together too high to take advantage of various miscellaneous deductions such as union dues, and unreimbursed business expenses, you may want to consider filing separate returns.
Plan for the next year.
tax planning does not have to be complicated or expensive involve accountants and unusual tax strategies. Sometimes simple changes can make a big difference at tax time.
For example, you usually receive tax credits and deductions education based on the year you paid the fee.
It is generally preferable to pay the deductible expenses in the first year possible to obtain the tax benefit earlier. But in some cases, you may be better distribute the costs of education through two or more years to qualify for the maximum education credits.
Another example would be to determine if your parents should ask you as a dependent. If you are a student under 24 years old and your parents pay at least half of your expenses, it could easily go either way.
If your parents are in a slice of much higher taxation, they usually will gain a much greater advantage of the dependency exemption you would.
you might want to put a little more of your money in savings, so they can make the exemption.
How long did it take to prepare your tax return this year?
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