Tax Tips: Claiming the Child Care Credit

Taxpayers can receive a direct reduction in their income taxes with the Child Care Credit. The credit may be up to $3,000 for one child or up to $6,000 for two or more children, and is given for qualified daycare or child care expenses.

To claim the credit, you must fill out Form 2441, which requires you to give the name, address, and taxpayer identification number of the child care provider. Your daycare center should give you this information. If your child is cared for in someone's home, you will need to request their information and social security number. In order to claim the credit, the taxpayer (and the spouse, if married) must also have earned income. As the taxpayer's income increases, the amount of the credit is reduced.

Tuition and fees at schools are not qualified expenses for purposes of this credit, however certain school programs could qualify. For example, if you pay for your child to participate in an after-school program because you need care for him after school, this will likely qualify for the Child Care Credit.

Details on the Child Care Credit can be found in IRS Publication 503.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Driving for Lyft? Use This Tax Preparation Checklist

So, you decided to become your own boss (at least part-time) and start driving for a ride-sharing company like Lyft. Use the Lyft tax preparation checklist below to organize your income and deductions to make filing your taxes a breeze. Remember, not all items listed will apply to you, but it will give you a good idea on what you need to report as income and what you can claim as a deduction.

Read More

Brought to you by TurboTax.com

Video: The Alternative Minimum Tax (AMT) Explained

Originally created to make sure the wealthy paid taxes even after using tax breaks and loopholes, the Alternative Minimum Tax (AMT) has never been updated and continues to impact middle class Americans more and more each year as a result of inflation. To compensate for inflation, the AMT now includes an exemption amount. This exemption is indexed for inflation so it changes every year.

Read More

Brought to you by TurboTax.com

Energy Tax Credit: Which Home Improvements Qualify?

Taxpayers who upgrade their homes to make use of renewable energy may be eligible for a tax credit to offset some of the costs. As of the 2018 tax year, the federal government offers the Nonbusiness Energy Property Credit. The credits are good through 2019 and then are reduced each year through the end of 2021. Claim the credits by filing Form 5695 with your tax return.

Read More

Brought to you by TurboTax.com

Top 5 Reasons to File Your Taxes Early

Every April, many taxpayers wait until the last minute to file their federal income tax returns. Despite this tendency, there are many reasons to file your taxes early. If you will receive a refund, you may want to submit your return as quickly as possible. Additionally, there are benefits to filing early for those taxpayers who have a balance due.

Read More

Brought to you by TurboTax.com
Read Full Story
Your resource on tax filing
Tax season is here! Check out the Tax Center on AOL Finance for all the tips and tools you need to maximize your return.