Dependents Feed

Last year, as companies and employees were struggling with operational changes necessary to safely deal with the COVID-19 pandemic, the Internal Revenue Service IRS provided relief that allowed employers to tweak benefits plans so that employees had increased flexibility to make mid-year changes to dependent care spending accounts. This change helped parents who had set aside tax-deferred money in child care accounts, but because their kids were at home while mom and/or dad also worked at home, did not need as much care account funds as they anticipated pre-pandemic. Today, the IRS has issued additional guidance on the latest coronavirus... Read more →


The Child Tax Credit (CTC), already a popular tax break, was enhanced for the 2021 tax year. In addition to being larger — up to $3,600 for each child younger 6 and up to $3,000 for each youngster age 6 through 17 instead up the usual $2,000 per qualifying child — it was available to more families. Most eligible households got half of their qualifying CTC amount last year as monthly advance payments. They were sent automatically to taxpayers who had filed returns in prior years. Families who didn't have to file, usually because they earned less than the amount... Read more →


Taxes don't typically prompt celebrations like that of these school children welcoming May with a traditional Maypole dance. But thinking about tax moves this month can help you avoid costly faux pas. (Photo by Paul Barnett via Wikimedia Commons) May is supposed to be the month full of flowers from the previous month's showers. Unfortunately, this year the month is starting off on a decidedly unmerry note. In the wake of the devastating Kansas tornadoes, forecasters are warning of multiple rounds this week of severe thunderstorms, including tornadoes, across the Plains, Midwest, and South. That's why heeding weather warnings and... Read more →


Photo by Vidal Balielo Jr. via Pexels Filing status is one of those tax matters that seems so simple, but which often trips up taxpayers in real life. As noted (shameless plug warning) in my 5 filing status choices item for the April Tax Tips page, most folks' status stays the same from tax year to tax year. But a change (or two, or more) in your personal situation could mean you need to revisit how you file your return. The head of household (HoH) status is a frequent source of confusion. Here, an unmarried person takes care of the... Read more →


Do check out these following related — and legitimate — tax write-offs Sometimes your home is indeed located at the intersection of favorable tax breaks. Sometimes it's not. Below is a look at the difference between some questionable and acceptable residential (and more!) write-offs. Every tax-filing season, the great quest by filers is to find the most tax breaks. But there are some deductions and credits you should steer clear of. These expenses that don't meet Internal Revenue Service guidelines mean the agency will stop processing your tax return to give it second (or third, or …) look. At best,... Read more →


Don't be an April Fool, or gullible person who's an easily caught fish when it comes to fakes floating around today. And never get caught in a tax myth net, on April 1 or any day. How's your April Fools' Day going? I hope you haven't been tricked into believing some outrageous claims. There even are a few April 1 tax pranks out there on social media. Don't fall for them. If you read or hear something tax-related that sounds a bit sketchy, take the time to check it out with reputable tax sources. To help in this area, here... Read more →


One of the big selling points of taking your taxes electronic is that the Internal Revenue Service's turnaround is quicker. The tax agency has long touted that when taxpayers e-file and have their refunds direct deposited, the tax cash usually shows up within 21 days. Usually. The only thing certain about taxes is that they'll find a way to frustrate you. That's the case when e-filed refunds take longer. Here are six reasons, from the IRS and tax community, as to why your refund may be delayed. 1. Math errors: Yes, taxes are complicated. That's why most of us use... Read more →


It's not a literally blank computer screen, but the IRS and White House Child Tax Credit portals aren't accepting input until after Tax Day on April 18. (Photo by cottonbro from Pexels) The increased Child Tax Credit (CTC) has been a boon for many U.S. families. The American Rescue Plan Act (ARPA) bumped up the tax break for the 2021 tax year from $2,000 per each eligible child to $3,600 for children age 5 or younger, and $3,000 for youngsters ages 6 to 17. Now, however, an online tool that the IRS created to make sure all who were due... Read more →


Scenic overlooks, like this view of the Austin skyline from my suburban neighborhood, can be lovely. But when it comes to taxes, you don't want to overlook tax breaks. (Photo by Kay Bell) If you're like most taxpayers, when you finally decide to do your taxes, you want to get it over with as soon as possible. But don't pay a price for you haste. If you rush through filling out your Form 1040, you could cheat yourself out of some tax savings. It happens every year. Folks overlook deductions, whether they itemize on Schedule A or claim above-the-line breaks... Read more →


Don't let filing your taxes scare you. Take that fear and turn it into awareness of common Form 1040 mistakes you need to avoid making. (Photo by Andrea Piacquadio from Pexels) The only thing worse than paying taxes is having to fill out the required paperwork every year. Just looking at a Form 1040, whether through the step-by-step Q&A lens of tax software or with the guiding hand of a tax pro, can send chills down the spines of most taxpayers, even those whose tax circumstances are relatively simple. There's that nagging fear that this is a test from Uncle... Read more →


The 2022 tax filing season is off to a strong start. In its first two weeks, from Jan. 24 to Feb. 4, the Internal Revenue Service received almost 16.7 million returns, and processed almost 13 million of them. The most important statistic for these millions of early filers is the refund numbers. Drum roll, please. So far, the IRS distributed more than 4.3 million refunds. The average refund very early this tax season is $2,201. That's the early average. Yours might be more. Or it might be less. In fact, many folks this filing season might find their refunds are... Read more →


Still trying to find out where your 2020 economic impact payment money is? Yes, from two years ago. The IRS has updated its frequently asked questions on how to trace this long-overdue amount. (Photo by Ann H from Pexels) This filing season is supposed to focus on 2021 tax returns, but some folks still are struggling with Internal Revenue Service issues from years ago. Specifically, some individuals are trying to track down COVID-19 economic impact payments (EIPs) the IRS says it issued two years ago. Yeah, it's been, and still is, that kind of tax crazy in pandemic time. First... Read more →


Today is EITC Awareness Day! OK, Jan. 28 isn't an official holiday to celebrate the Earned Income Tax Credit, usually referred to (at least in the tax world) by its acronym EITC. But it is an annual event promoted by the Internal Revenue Service. Every year in late January, the tax agency focuses on getting the word out about the EITC. The reason is simple. Millions of individuals regularly overlook the EITC and surrendering thousands of dollars they could use. The EITC itself, however, is not so easy to claim. That's why a lot of folks ignore it. The IRS... Read more →


Photo by Anna Shvets from Pexels For some folks, the question isn't when to file, but whether they need to do so at all. It's a legitimate issue. While most of us do have to send in a Form 1040 every year, there are some situations where the Internal Revenue Service doesn't demand filing. So just who has to file a tax return? Filing requirements for most of us: Generally, if you are a U.S. citizen or resident you must consider three things when determining whether you have to file a tax return: your age, your filing status and your... Read more →


You're expecting a refund, so you're planning to file your tax return soon. Wait. You might want to take a step or two back. First, you need to make sure you have all the information you need to properly fill out your 2021 Form 1040. You can get an idea of that material in my post examining some common tax statements you need to complete your filing. Second, you need more than paperwork. You need to take a good look at your personal situation and answer some questions. The responses could affect your filing. This checklist can help. Start with... Read more →


It's the first week of January and some people are already working on their taxes. They're expecting a refund and they want the Internal Revenue Service to have their forms as soon as possible so the agency can process them when tax season 2022 officially starts. Those enthusiastic filers, however, might want to take a break. In order to properly file their 2021 tax returns, many likely will need one or both tax statements the IRS is sending out this month. One is a notice of how much an individual got as the third Economic Impact Payment (EIP) issued in... Read more →


A lot of families were smiling the last half of 2021 as they received early Child Tax Credit payments. (iStock) On Dec. 15, the Internal Revenue Service distributed the last of 2021's Advance Child Tax Credit (AdvCTC) payments. The monthly tally came to just more than $16 billion. Since the $300 per child for kiddos age 5 or younger and $250 for youngsters ages 6 to 17 started going out in July, nearly $93 billion has been issued to qualifying families, according to the U.S. Treasury. Recipients of their portions of those early billions can claim the Child Tax Credit... Read more →


This holiday season, some families are getting an added gift: their final Advance Child Tax Credit payment for 2021. An estimated 36 million families will see their final Advance Child Tax Credit arrive in their bank accounts today, Dec. 15. The bank deposit will be labeled CHILDCTC. Those getting the early 2021 tax year payments by mailed paper Treasury checks should have their money soon. Then what? Today's end of the pre-payments is the start of another process. When filing season starts next year, eligible families will claim the remaining Child Tax Credit (CTC) amounts for this year on their... Read more →


A close-up of some of our Christmas tree ornaments, including the newest one showcasing Austin icon El Arroyo's sign wisdom. (Photo by Kay Bell) Ho, Ho, Ho! The jolly month of December is here, bringing the official start of winter, Christmas and other holidays, and taxes. Yeah, that last December item might harsh your holidays. But the tax moves you make over the next 31 days could make your 2021 and 2022 tax situations happy and bright. Here's a look at 6 December tax moves you at least want to consider. 1. Keep an eye on Congress. Yeah, too often... Read more →


Single parenting can be challenging, especially at tax time and you and your ex-spouse are vying for the same child-related tax breaks. (Photo by MART PRODUCTION from Pexels) For some, this Thanksgiving was quieter than normal. Their youngsters spent Turkey Day with their parent as part of the alternating holidays agreement reached in the divorce decree. Breaking up is always hard. It's also complicated when it involves lawyers, court hearings and the Internal Revenue Service. It's can get even more complex when children are involved. I'm not a lawyer. I don't play one on the ol' blog. And I don't... Read more →


A tax credit for dependents offers a break for older children, extended family members, and even non-relatives. Thanksgiving is the traditional time for families to gather. But not all families are traditional. That's evident in real and tax life. The family-friendly tax break that's been getting most attention of late is the Child Tax Credit (CTC) and the advance payments for 2021 that are going out through December. I'm guilty, as a perusal of the ol' blog quickly shows. But some families aren't eligible for the CTC, either the money being distributed now or when they file their annual tax... Read more →