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CHILD AND DEPENDENT CARE CREDIT
This credit seeks to reimburse for at least part of the cost of care while you are at work. You qualify if you paid someone to care for your child, your spouse or a dependent while you were working or looking for work. the person you paid cannot be a spouse, the parent of the person being cared for or one of your dependents. the credit is worth up to 35% of the qualified costs for care, up to $3,000 for one person. If you pay for care for more than one person the total jumps to $6,000 for the tax year.
CHILD TAX CREDIT
Not to be confused with the Child Care Credit, this credit is for taxpayers with dependent child under age 17. It can be worth up to $1,000 for each qualifying child in addition to the regular exemption for the dependent.
EARNED INCOME TAX CREDIT (EITC)
Also called the EIC, this credit is aimed at low and moderate income tax payers who hold down jobs or are self employed. Working families as well as single working taxpayers qualify. The biggest qualifying element with this element is earned income from wages or self employment without it, there is no EITC. The amount of the credit varies with the amount of income, the number of qualifying dependents and the age of the taxpayer.
This has been a sleeper among tax credits. It gives taxpayers who are saving toward retirement a credit of up to $1,000, $2,000 for married couples, It is good for incomes up to the single limit f $30,000 or $60,000 if married if filing jointly. You qualify by contributing to a qualified retirement plan such as a 401k
EDUCATION CREDITS OR DEDUCTION
You actually have three choices when it comes to getting some of your higher education expense back from Uncle Sam. the American Opportunity Tax Credit is for expense at a qualifying institution for the first four years of college. The lifetime Learning Credit is aimed at those working toward a post graduate degree, or a taxpayer who strings out courses over a number of years, whether for work related reasons or the sheer joy of learning. there is also a tuition and fees deduction for taxpayers who do not qualify for either of the two credits.
JOB SEARCH DEDUCTION
If you were looking for a new job within your current career path, the expenses incurred can be duducted from your taxable income. The deduction applies even if you were not successful in finding a new position Expenses such as resume preparation and printing placement fees or travel to potential employers may qualify. Looking for a new job in a new field, however is not covered.
Most of know we can deduct our contributions of cash or property to a qualified charity or non-profit organization. But if we do any volunteer work for those qualified organizations we may also be able to deduct the expenses we may incur int eh course of volunteering. If you drive your vehicle as part of your volunteer work, your gas and other expenses could be deducted,
GAMBLING LOSSES DEDUCTION
It should be no suprise that you are required to report all you gambling winnings on your income tax return. But it may not be quite so widely know you can deduct some of your losses from your taxable income as well. Your losses are deductible are limited to the amount of your winnings.
TAX SAVINGS STRATEGIES