As the April 15th tax filing deadline rapidly approaches, be sure to take these often overlooked deductions into consideration, when talking with your tax professional. These are simple deductions that can greatly impact your tax liability and therefore allow you to keep more of your money.
- $1000 Child Tax Credit – If your family grew last year, you may qualify for the Child Tax Credit. The child must have a social security number – which can be applied for in the hospital at the time of birth or through the Social Security Administration. Your dependent child(ren) may be claimed on the parent(s) tax return until the age of 17. Income limits and dependency requirements are individual, so please discuss the requirements with your trusted tax professional.
- Childcare Expenses – Employed parents may qualify for a tax credit in which income was exchanged for the care of a child/children. This applies if both parents work (for married families), for a single parent, and also if one parent works and one is a full time student. If the child is younger than 13 and you paid for childcare, ask your tax professional which deductions are available to you.
- College Credits – Through the American Opportunity Tax Credit or through a tuition deduction, your family may be eligible for additional tax deductions. This can include the cost of books, supplies and equipment the student purchases that relate to the program of study when you calculate the credit. This deduction phases out at certain income levels that your tax professional will be familiar with. This is not just limited to traditional universities, but anywhere financial student aid is offered.
- Moving Expenses – If your family moved more than 50 miles due to a job change, moving expenses can be deducted. Expenses associated with moving companies, truck rentals, storage fees, packing materials, mileage and even travel expenses qualify for this benefit.
- Energy Efficiency Home Improvements – Utilizing the Residential Energy Efficiency Property Tax credit could result in deductions for up to 30% of the cost of items such as: solar hot water heaters, solar electricity equipment, solar wind turbines, and solar panels. This credit expires in 2016.
- Homeowner Tax Deductions – Property taxes, mortgage interest, premiums for private mortgage insurance (prior to 2006), interest on home equity loans and home equity lines of credit may all qualify for a larger deduction. This is a great way to greatly reduce your overall taxable income.
If you and your family experienced any of these changes, take the time to visit with your trusted tax professional today and ensure that you are keeping as much of the income you have earned as possible.