Having Babies For Tax Purposes
When kids are cooped up in the house during summer or winter vacation, or when attending virtual classes at home, they can be overwhelming, but they are also wonderful tax-savers when it comes time to pay your taxes.
Even though the dependency exemption was removed as part of tax reform, there are still certain tax benefits available to you if you have children or other dependents.
Child Tax Credit
You could be qualified for the Child Tax Credit, which is a tax credit for your dependent children that is better than a tax deduction since it lowers your taxes dollar-for-dollar. The Child Tax Credit under the American Rescue Plan rose from $2,000 to up to $3,000 for each qualified child over the age of six, and up to $3,600 for each qualifying child under the age of six, beginning in the tax year 2021 (the taxes you file in 2022).
Other Dependent Credit
You may be able to claim the Other Dependent Credit of up to $500 per qualified individual if you don't qualify for the Child Tax Credit and your dependent child is above 17 or you assist a friend or family. If your adjusted gross income exceeds $200,000 (or $400,000 for married filing joint returns), the credit begins to fade off.
Resolve Your Tax Bills
No taxpayer in their right mind wants to be hit with that tax bill, especially if it tends to be a struggle to pay off. The tax credit will not be enough to satisfy any tax debts individuals and families may have with the IRS. But there is a new and improved relief program that consolidates many major relief programs into a one-size-fits-all assistance program. Any issues regarding back taxes, unfiled years, or any other tax-related problems may be solved through one program; the IRS Fresh Start Program!
See if you qualify for the Fresh Start Program today!
Resolve your tax debt before the IRS surprises you with late fees and penalties!
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