4 Things New Parents Need to Know About Taxes
Becoming a parent is one of the biggest transformations you'll ever go through. As you consider nursery-room renovations, midnight feedings, diaper changes, and the other challenges of parenthood, probably the last thing on your mind is the impact that having children can have on your income taxes.
Fortunately, when it comes to taxes, the news for parents is generally good.
Here's a brief look at some of the ways that having children can help you save on your tax return.
Motley Fool contributor Dan Caplinger has enjoyed the tax and other benefits of his daughter for seven years. You can follow him on Twitter here.
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Now that you've bought six extra months by filing an income tax extension, you might be wondering what you need to do between now and October 15, 2013 when your 2012 tax return is due. We've addressed some of the most common questions below.
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Can't afford to pay your income taxes? You may be able to qualify for an installment plan with the Internal Revenue Service. The minimum monthly payment for your plan depends on how much you owe.
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The Internal Revenue Service allows taxpayers to file for a six-month extension if they need more time to prepare their tax return. You can obtain a tax extension for any reason; the IRS grants them automatically as long as you complete the proper form on time. Check your state tax laws; some states accept IRS extensions while others require you to file a separate state extension form.
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The Internal Revenue Service recognizes the fact that members of the United States armed forces are often deployed outside of the U.S. at tax time and gives many military and support personnel an extension on their tax deadlines.
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In general, you can deduct interest paid on money you borrow to invest, although there are restrictions on how much you can deduct and which investments actually qualify you for the deduction.
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