Effectively navigating the complexities inherent in tax credits poses a formidable challenge for many individuals. Ausland Tax Services LLC understands the challenges many individuals and families face, and they’re committed to helping you make the most of available tax credits. In this blog post, we’ll explore the top tax credits, ensuring you can optimize your returns with confidence.
- Earned Income Tax Credit (EITC):
- The EITC is a valuable credit designed to assist low to moderate-income workers. Eligibility depends on your earned income and filing status.
- To see if you qualify for the Earned Income Tax Credit, you can use this IRS EITC Assistant to find out or contact Ausland Tax Services and we will be happy to assist you.
- Basic Qualifications:
- Have earned income under $63,398
- Possess investment income below $11,000 in 2023
- Hold a valid Social Security number by the due date of their 2023 return
- Are U.S. citizens or resident aliens throughout the year
- Do not file Form 2555 for Foreign Earned Income
- Meet specific rules if separated from their spouse and not filing a joint tax return.
- The maximum amount of credit:
- No qualifying children: $600
- 1 qualifying child: $3,995
- 2 qualifying children: $6,604
- 3 or more qualifying children: $7,430
- *Claiming this credit will delay your refund until mid-February.
Who Qualifies for the Earned Income Tax Credit (EITC) | Internal Revenue Service (irs.gov)
- Child and Dependent Care Credit:
- Individuals with qualifying dependents may be eligible for this credit, which helps cover the costs of childcare while allowing you to work or look for employment.
- Total calculate credit may be $3,000 filing single or $6,000 filing Married filing joint. You may claim 20% to 35% of your care expenses up to those amounts. Married filing Single does not qualify unless for certain circumstances.
- Ausland Tax Services LLC can guide you through the criteria to ensure you claim the maximum benefit.
- Topic No. 602, Child and Dependent Care Credit | Internal Revenue Service (irs.gov)
- Education Credits:
- If you’re pursuing higher education, consider claiming education credits like the American Opportunity Credit or the Lifetime Learning Credit.
- Check out this chart provided by the IRS to see which one is best for you.
- Ausland Tax Services LLC can help you understand the eligibility criteria and claim these credits for education-related expenses.
- Child Tax Credit:
- Married couples or single individuals with qualifying children may be eligible for the Child Tax Credit.
- A qualifying child can be your son, daughter, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, half-brother, half-sister, or a descendant of one of these (for example, a grandchild, niece or nephew).
- Qualifying child amount is $2,000 per child.
- There are 2 important updates to the qualifying Child Tax Credit.
- Credit amount has been reduced back to $2,000. It was increased in the last couple years.
- The age of the qualifying child has also been reduced. It is now up to the age of 17 by the end of the tax year. If you qualifying child reaches the age of 18 in the tax year they no longer qualify.
- Ausland Tax Services LLC will guide you through the requirements and help you claim this credit for each qualifying child.
- Child Tax Credit | Internal Revenue Service (irs.gov)
- Saver’s Credit:
- The Saver’s Credit is designed to encourage retirement savings for low to moderate-income households.
- Married Filing Jointly:
- 50% credit for AGI up to $43,500
- 20% credit for AGI between $43,501 and $47,500
- 10% credit for AGI between $47,501 and $73,000
- 0% credit for AGI over $73,000
- Head of Household:
- 50% credit for AGI up to $32,625
- 20% credit for AGI between $32,626 and $35,625
- 10% credit for AGI between $35,626 and $54,750
- 0% credit for AGI over $54,750
- All Other Filers:
- 50% credit for AGI up to $21,750
- 20% credit for AGI between $21,751 and $23,750
- 10% credit for AGI between $23,751 and $36,500
- 0% credit for AGI over $36,500
- Ausland Tax Services LLC can help you explore opportunities to claim this credit by contributing to retirement savings accounts.
- Retirement Savings Contributions Savers Credit | Internal Revenue Service (irs.gov)
Ausland Tax Services is committed to ensuring that households receive the tax credits they deserve. By partnering with Ausland Tax Services LLC, you can navigate the complexities of the tax code with confidence and maximize your tax return. Don’t let valuable credits slip through the cracks.