Wealth & Risk Management Blog

William Byrnes (Texas A&M) tax & compliance articles

The Child Tax Credit May Cut Your Tax

Posted by William Byrnes on March 4, 2014


IRS Tax Tip 2014-18 reminds taxpayers whom have a child or children under 17, then the Child Tax Credit may save money at tax time.  Key facts the IRS wants taxpayers to know about the Child Tax Credit:

• Amount.  The non-refundable Child Tax Credit may help cut the federal income tax by up to $1,000 for each qualifying child claimed on a tax return.

• Qualifications.  A child must pass seven tests to qualify for this credit:

1. Age test. The child was under age 17 at the end of 2013.

2. Relationship test. The child is a son, daughter, stepchild, foster child, brother, sister, stepbrother, or stepsister. A child can also be a descendant of any of these persons. For example, a grandchild, niece or nephew will meet this test. Adopted children also qualify. An adopted child includes a child lawfully placed with a taxpayer for legal adoption.

3. Support test. The child did not provide more than half of his or her own support for 2013.

4. Dependent test. Claim the child as a dependent on your 2013 federal income tax return.

5. Joint return test. A married child can not file a joint return with their spouse.

6. Citizenship test. The child must be a U.S. citizen, U.S. national or U.S. resident alien.

7. Residence test. In most cases, the child must have lived with the taxpayer for more than half of 2013.

• Limitations. Taxpayer’s filing status and income may reduce or eliminate the credit.

• Additional Child Tax Credit.  If the taxpayer receives less than the full Child Tax Credit, may still qualify for the refundable Additional Child Tax Credit. This means taxpayer may receive a refund even if no tax is owed.

• Schedule 8812.  A taxpayer may need to file Schedule 8812, Child Tax Credit, with the tax return. A taxpayer claiming the Additional Child Tax Credit must complete and attach Schedule 8812.

• Interactive Tax Assistant Tool.  Use the ITA tool to determine whether it is possible to claim the Child Tax Credit.

For more than half a century, Tax Facts has been an essential resource designed to meet the real-world tax-guidance needs of professionals in both the insurance and investment industries.

2014_tf_on_individuals_small_businesses-m_1Due to a number of recent changes in the law, taxpayers are currently facing many questions connected to important issues such as healthcare, home office use, capital gains, investments, and whether an individual is considered an employee or a contractor. Financial advisors are continually looking for updated tax information that can help them provide the right answers to the right people at the right time. This brand-new resource provides fast, clear, and authoritative answers to pressing questions, and it does so in the convenient, timesaving, Q&A format for which Tax Facts is famous.

“Our brand-new Tax Facts title is exciting in many ways,” says Rick Kravitz, Vice President & Managing Director of Summit Professional Network’s Professional Publishing Division. “First of all, it fills a huge gap in the resources available to today’s advisors. Small business is a big market, and this book enables advisors to get up-and-running right away, with proven guidance that will help them serve their clients’ needs. Secondly, it addresses the biggest questions facing all taxpayers and provides absolutely reliable answers that help advisors solve today’s biggest problems with confidence.”

The company also points out that the expert authors—Robert Bloink, Esq., LL.M., and William H. Byrnes, Esq., LL.M., CWM®—are delivering real-life guidance based on decades of experience.

tax-facts-online_medium

The authors’ knowledge and experience in tax law and practice provides the expert guidance for National Underwriter to once again deliver a valuable resource for the financial advising community,” added Kravitz.

Anyone interested can try Tax Facts on Individuals & Small Business, risk-free for 30 days, with a 100% guarantee of complete satisfaction.  For more information, please go to www.nationalunderwriter.com/TaxFactsIndividuals or call 1-800-543-0874.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: