REDUCE YOUR TAXES WITH THE CHILD AND DEPENDENT CARE CREDIT (ADVANCE TAX RELIEF LLC www.advancetaxrelief.com (800)790-8574)

The Child and Dependent Care Tax Credit can reduce the taxes you pay. If you paid someone to care for a person in your household last year while you worked or looked for work, then read on for 10 facts from the IRS about this important tax credit:

1. Child, Dependent or Spouse. You may be able to claim the credit if you paid someone to care for your child, dependent or spouse last year.

2. Work-Related Expense. The care must have been necessary so you could work or look for work. If you are married, the care also must have been necessary so your spouse could work or look for work. This rule does not apply if your spouse was disabled or a full-time student.

3. Qualifying Person. The care must have been for “qualifying persons.” A qualifying person can be your child under age 13. A qualifying person can also be your spouse or dependent who lived with you for more than half the year and is physically or mentally incapable of self-care.

4. Earned Income. You must have earned income for the year, such as wages from a job. If you are married and file a joint tax return, your spouse must also have earned income. Special rules apply to a spouse who is a student or disabled.

5. Credit Percentage / Expense Limits. The credit is worth between 20 and 35 percent of your allowable expenses. The percentage depends on the amount of your income. Your allowable expenses are limited to $3,000 if you paid for the care of one qualifying person. The limit is $6,000 if you paid for the care of two or more.

6. Dependent Care Benefits. If your employer gives you dependent care benefits, special rules apply. For more on these rules see Form 2441, Child and Dependent Care Expenses.

7. Qualifying Person’s SSN. You must include the Social Security Number of each qualifying person to claim the credit.

8. Care Provider Information. You must include the name, address and taxpayer identification number of your care provider on your tax return.

9. Form 2441. You file Form 2441 with your tax return to claim the credit.

Have any tax related questions or need IRS tax help?

contact us (800)790-8574 for a free consultation

ADVANCE TAX RELIEF LLC - We Solve Tax Problems

www.advancetaxrelief.com

(800)790-8574

BBB ACCREDITED BUSINESS

MORTGAGE DEBT FORGIVENESS: TAX TIP (ADVANCE TAX RELIEF LLC www.advancetaxrelief.com (800)790-8574)

If your lender cancels part or all of your debt, you normally must pay tax on that amount. However, the law provides for an exclusion that may apply to homeowners who had their mortgage debt cancelled in 2014. In most cases where the exclusion applies, the amount of the cancelled debt is not taxable. Here are the top 10 tax tips about mortgage debt cancellation:

1. Main Home.  If the cancelled debt was a loan on your main home, you may be able to exclude the cancelled amount from your income. You must have used the loan to buy, build or substantially improve your main home to qualify. Your main home must also secure the mortgage.

2.Loan Modification.  If your lender cancelled part of your mortgage through a loan modification or ‘workout,’ you may be able to exclude that amount from your income. You may also be able to exclude debt discharged as part of the Home Affordable Modification Program, or HAMP. The exclusion may also apply to the amount of debt cancelled in a foreclosure.

3.Refinanced Mortgage.  The exclusion may apply to amounts cancelled on a refinanced mortgage. This applies only if you used proceeds from the refinancing to buy, build or substantially improve your main home. Amounts used for other purposes don’t qualify.

4.Other Cancelled Debt.  Other types of cancelled debt such as second homes, rental and business property, credit card debt or car loans do not qualify for this special exclusion. On the other hand, there are other rules that may allow those types of cancelled debts to be nontaxable.

5.Form 1099-C.  If your lender reduced or cancelled at least $600 of your debt, you should receive Form 1099-C, Cancellation of Debt, in January of the next year. This form shows the amount of cancelled debt and other information.

6.Form 982.  If you qualify, report the excluded debt on Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness. File the form with your federal income tax return.

7.Exclusion extended.  The law that authorized this exclusion had expired at the end of 2013. The Tax Increase Prevention Act extended it to apply for one year, through Dec. 31, 2014.

Have any tax related questions or need IRS tax help?
contact us (800)790-8574 for a free consultation

ADVANCE TAX RELIEF LLC - We Solve Tax Problems

www.advancetaxrelief.com

(800)790-8574

BBB ACCREDITED BUSINESS

CLAIMING A TAX DEDUCTION FOR MEDICAL AND DENTAL EXPENSES (ADVANCE TAX RELIEF LLC (800)790-8574 www.advancetaxrelief.com)

Your medical expenses may save you money at tax time, but a few key rules apply. Here are some tax tips to help you determine if you can claim a tax deduction:

You must itemize: You can only claim your medical expenses that you paid for in 2014 if you itemize deductions on your federal tax return. If you take the standard deduction, you can’t claim these expenses.

AGI threshold: You include all the qualified medical costs that you paid for during the year. However, you can only deduct the amount that is more than 10 percent of your adjusted gross income.

Temporary threshold for age 65: If you or your spouse is age 65 or older, the AGI threshold is 7.5 percent of your AGI. This exception applies through Dec. 31, 2016.

Costs to include: You can include most medical and dental costs that you paid for yourself, your spouse and your dependents. Exceptions and special rules apply. Costs reimbursed by insurance or other sources do not qualify for a deduction.

Expenses that qualify: You can include the costs of diagnosing, treating, easing or preventing disease. The costs you pay for prescription drugs and insulin qualify. The costs you pay for insurance premiums for policies that cover medical care qualify. Some long-term care insurance costs also qualify.

Travel costs count: You may be able to claim travel costs you pay for medical care. This includes costs such as public transportation, ambulance service, tolls and parking fees. If you use your car, you can deduct either the actual costs or the standard mileage rate for medical travel. The rate is 23.5 cents per mile for 2014.

No double benefit: You can’t claim a tax deduction for medical expenses you paid for with funds from your Health Savings Accounts or Flexible Spending Arrangements. Amounts paid with funds from those plans are usually tax-free. This rule prevents two tax benefits for the same expense.

Have any tax related questions or need IRS tax help?

contact us (800)790-8574 for a free consultation

ADVANCE TAX RELIEF LLC - We Solve Tax Problems

www.advancetaxrelief.com

(800)790-8574

BBB ACCREDITED BUSINESS

https://plus.google.com/+ADVANCETAXRELIEFLLCHouston/posts

FIVE KEY FACTS ABOUT UNEMPLOYMENTS BENEFITS (ADVANCE TAX RELIEF LLC www.advancetaxrelief.com (800)790-8574)

If you lose your job, you may qualify for unemployment benefits. The payments may serve as much needed relief. But did you know unemployment benefits are taxable? Here are five key facts about unemployment compensation:

1. Unemployment is taxable. You must include all unemployment compensation as income for the year. You should receive a Form 1099-G, Certain Government Payments by Jan. 31 of the following year. This form will show the amount paid to you and the amount of any federal income tax withheld.

2. Paid under U.S. or state law. There are various types of unemployment compensation. Unemployment includes amounts paid under U.S. or state unemployment compensation laws.

3. Union benefits may be taxable. You must include benefits paid to you from regular union dues in your income. Other rules may apply if you contributed to a special union fund and those contributions are not deductible. In that case, you only include as income any amount that you got that was more than the contributions you made.

4. You may have tax withheld. You can choose to have federal income tax withheld from your unemployment. You can have this done using Form W-4V, Voluntary Withholding Request. If you choose not to have tax withheld, you may need to make estimated tax payments during the year.

5. If you’re facing financial difficulties, contact the experts at Advance Tax Relief LLC for a free tax relief consultation.

Have any tax related questions or need IRS tax help?

contact us (800)790-8574 for a free consultation

ADVANCE TAX RELIEF LLC - We Solve Tax Problems

www.advancetaxrelief.com

(800)790-8574

BBB ACCREDITED BUSINESS

https://plus.google.com/+ADVANCETAXRELIEFLLCHouston/posts