F.A.Q’S

                                                                                                      F.A.Q

COME CHECK THIS PAGE OFTEN IM ALWAYS THINKING OF SOME RANDOM QUESTION OR RECIEVING A GOOD QUESTION. I WILL POST PERIODICALLY SO KEEP CHECKING OR SEND A EMAIL AND I WILL RESPOND.

 

What Is a Tax Credit?

Cred­it is what you Sub­tract from the amount of tax you owe. There are two types of tax cred­its:

  • A non­re­fund­able tax cred­it means you get a refund only up to the amount you owe.
  • A refund­able tax cred­it means you get a refund, even if it’s more than what you owe.

What Is a Tax Deduction?

deduc­tions are what you sub­tract from your income before you fig­ure the amount of tax you owe.

Are child sup­port pay­ments deductible by the pay­er or can the pay­er claim a depen­den­cy exemp­tion for the child?

No, child support payments are neither deductible by the payer nor taxable income to the recipient sorry!

BUUUUUUUUT, don’t you just love when there is a but?  the pay­er of child sup­port may be able to claim the child as a depen­dent:

  • The child is the qual­i­fy­ing child of the cus­to­di­al par­ent, and the cus­to­di­al par­ent is gen­er­al­ly allowed to claim a depen­den­cy exemp­tion for the child, if the oth­er tests for claim­ing the exemp­tion are met. Tech­ni­cal­ly which ever par­ent the kid lived with  for the most  part of the year is the cus­to­di­al par­ent for income tax pur­pos­es.
  • The non­cus­to­di­al par­ent may claim an exemp­tion for the child if the spe­cial rule for a child of divorced or sep­a­rat­ed par­ents (or par­ents who live apart) applies. This requires, that the cus­to­di­al par­ent sign a Form 8332, Release/Revocation of Release of Claim to Exemp­tion for Child by Cus­to­di­al Par­ent, or a sub­stan­tial­ly sim­i­lar state­ment. The non­cus­to­di­al par­ent must attach it to his or her return. so there are no hold ups and no oth­er hic­cups in your return
  • To claim your child as your dependent, your child must meet either the qualifying child test or the qualifying relative test:

    • meet the  qual­i­fy­ing child test, your child must be younger than you and either younger than 19 years old or be a “stu­dent” younger than 24 years old as of the end of the cal­en­dar year.
    • There’s no age lim­it if your child is “per­ma­nent­ly and total­ly dis­abled” or meets the qual­i­fy­ing rel­a­tive test.
    • PLEASE LOOK INTO ALL THE TEST AND MAKE SURE THE PERSON IS SOMEONE THAT QUALIFIES. YOU WILL GET AUDIT AND YOU WILL HAVE TO PAY BACK AND SOME
    • AND NOT BE ABLE TO CLAIM THE CREDIT SO ONCE AGAIN IM GONNA ASK FOR YOU TO DO ME A FAVOR , SPARE YOURSELF THE HEADACHE.

    Pretty much in order , to qualify for head of household, you must have a qualifying child or dependent. However, a custodial  parent may be able to claim head of household filing status with a qualifying child even if he or she released a claim to exemption for the child

    A unmarried dependent student must file a tax return if his or her earned or unearned income exceeds certain limits. You can find these   limits, refer to Dependents under Who Must File, in  Publication 501, Exemptions, Standard Deduction, and Filing Information. on the IRS website or pub

    SOME TASHA ADVICE TO ALL NOT ONLY STUDENTS, Even if you don't have to file a federal income tax return (AND I MEAN YOU DIDN'T MAKE THE AMOUNT OF MOENY TO WHERE YOU HAVE TO LEGALLY FILE. NOT YOU SHOULD FILE AND DIDN'T WORK AND HAVE KIDS AND THINK YOU ARE GETTING A REFUND)you should file if you can get money back (for example, you had federal income tax withheld from your pay or you qualify for a refundable tax credit you may not know that there are certain credits you are entiled to. Plus any money is money even if it isn't as much as your coworker or sibling got back. See Who Should File in Publication 501, for more examples