- Days left
Tax credits are one sure way to put money in your pocket. A credit is a direct reduction of the amount of tax you owe, so it can be very valuable. Some of them are even refundable, meaning that you can get tax money back even if you didn't pay in.

Three key tax credits are often overlooked by taxpayers, and the Internal Revenue Service has no responsibility to let you know that you could claim them. So it's important to make sure you claim everything you're entitled to claim.

The child care credit can be used by those who put their small children in daycare or with a babysitter so they can attend work or school. Make sure to get documentation from your daycare provider about the total amount you paid during the year, as well as the provider's social security number or federal identification number. You'll need that number to get the credit on your tax return. The credit can be up to $1,050 per child in daycare, but the actual amount depends on your daycare expenses and your income.
The retirement savings credit is offered to encourage lower income taxpayers to contribute to retirement accounts. In addition to getting to deduct the contribution from their taxable income, taxpayers can also receive a credit of up to $2,000, so this is a great chance to double-dip legally.

Don't forget about education credits available for those taking college courses. The maximum credit is $2,000, and is calculated based on your total tuition and fees paid to a qualified educational institution in a degree-seeking program. The credit is taken by the person who claims the student as a dependent, so if your parents still claim you on their tax return, they'll get the credit.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.


Increase your money and finance knowledge from home

Getting out of debt

Everyone hates debt. Get out of it.

View Course »

Building Credit from Scratch

Start building credit...now.

View Course »

TurboTax Articles

Tax Tips for the Blind

Anyone whose field of vision falls at or below 20 degrees, who wears corrective glasses but whose vision is 20/200 or less in his best eye, or who has no eyesight at all, meets the legal definition of being blind and is eligible for certain tax deductions.

What is Form 4255: Recapture of Investment Credit?

When is a tax credit not a tax credit? When the IRS takes it back. If you're in the situation where you have to file IRS Form 4255, you might have to pay back a tax credit you've earned in prior years. This process, known as recapture, occurs if you claim a credit -- in this case, a credit for a specific type of business investment -- and then no longer qualify for that credit.

The Most Important Tax Forms for ALEs (Applicable Large Employers)

In 2015, some parts of the Affordable Care Act specifically apply to businesses, in particular, large employers. The Employer Shared Responsibility provisions affect companies with 50 or more full-time employees or an equivalent of part-time or seasonal workers. These companies are called Applicable Large Employers, or ALEs. 2015 is considered a transition year as everyone gets used to the new normal for workplace health plans.

Employer Sponsored Health Coverage Explained

The Affordable Care Act, also known as Obamacare, is simpler than some people may give it credit for. The basic rule to remember is that everyone must carry Minimum Essential Coverage (MEC) or pay a penalty. Employers with 50 full-time employees or more are obligated to sponsor plans for their workers to help them meet this requirement.

How to Report RSUs or Stock Grants on Your Tax Return

Restricted stock units (RSUs) and stock grants are often used by companies to reward their employees with an investment in the company rather than with cash. As the name implies, RSUs have rules as to when they can be sold. Stock grants often carry restrictions as well. How your stock grant is delivered to you, and whether or not it is vested, are the key factors when determining tax treatment.

Add a Comment

*0 / 3000 Character Maximum