Nine tax credits and loans that parents can get
Regardless of the age of your children and your marital status, raising a biological or adopted child gives you the right to tax benefits and discounts.
Edition The Penny Hoarder collected a list of ways for parents to save on taxes.
1. Medical expenses
If you paid medical expenses for maternity from your own pocket, and they were not reimbursed to you, then you have the right to deduct them from taxes. According to the law, such expenses should be at least 10% of your income. It seems difficult to achieve, but during pregnancy and childbirth such expenses are quite possible. Therefore keep your checks.
After the birth of your baby, you are eligible to receive a child tax credit - up to $1000 per child under 17, depending on your income.
The adoption process in the United States is quite an expensive procedure. Therefore, parents who decide to take this step are given a tax credit of up to $13 thousand.
This loan covers travel expenses, attorney fees, attorney fees, as well as home study expenses.
It is important to keep all receipts and checks.
If you earned income last year, but did not exceed certain thresholds, you can qualify for a tax credit that can significantly reduce your tax amount.
The threshold value depends on your marital status and the number of children. For example, if you file a declaration yourself and have an 1 child, then with an annual income of less than $ 39, 131 can apply for a loan. If you file a declaration with your husband or wife and have 3 children, then your total income must be less than $ 53 267 to get a loan.
The maximum loan amount for the 2015 tax year was as follows:
- $ 6 242 with 3 and more children;
- $5 - 548 children;
- $3 - 359 child.
Taxpayers without children are also eligible for such a loan, but then income requirements and loan amounts differ.
According to Care.com, the average American family spends about $ 18 thousand a year on child care. Part of this money can be reimbursed by tax credit.
If your child is less than 12 years old, you can apply for a childcare tax credit. It covers 35% of annual expenses for a baby, but not more than $ 3000.
6. The status of the head of the family
If you are raising a child alone, you can become the head of a family, which automatically gives you the right to pay taxes at a lower rate.
To be considered the head of the family, you must:
- Not married on at least the last day of the tax year - December 31;
- Cover more than 50% of household financial expenditures;
- Have a child who lives with you more than 6 months in a year.
7. Tax Credit Opportunity (American Opportunity Tax Credit)
During the first 4 years of your child’s education, you can claim up to $ 2500 a study credit and related expenses.
The income threshold for receiving a loan for single parents is up to $80 thousand, for married couples - up to $160 thousand.
There are no restrictions on how many times you take a loan for learning during your lifetime.
It can be up to $ 2 thousands and cover tuition, supplies and equipment.
9. State loans for children in primary or secondary school
Some states offer benefits for certain items or activities during the school year.
For example, in Arizona, if your children attend public school, you are eligible for a tax credit if you pay any fees related to extracurricular activities, such as buying sports equipment or uniforms. You can even qualify for a loan if you spend money on SAT / ACT tests or preparatory courses.
Read also on ForumDaily:
How to pay taxes if you received unemployment benefits
How to deduct from the expenses of maintaining a home office
How to file a tax return with a boyfriend or girlfriend
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