Wednesday, September 17, 2014

 
 


Education credits: Understand your Form 1098-T

If you’re a college student or parent of a college student, you may be eligible for an education credit. Most students receive a Form 1098-T, Tuition Statement, from their educational institution. Form 1098-T contains helpful instructions and other information you’ll need to claim education credits on your federal tax form. These credits help offset your out-of-pocket expenses for tuition and fees, books and equipment.

Your educational institution is required to file a Form 1098-T with the IRS and provide you a copy when there is a reportable transaction. A reportable transaction includes payments received, amounts billed or refunds made for tuition and related expenses. The form should also give you other information for the educational institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements, or refunds, and whether you were enrolled at least half time or were a graduate student.

In most cases, you should receive Form 1098-T from the eligible educational institution by Jan. 31. If you don’t receive it by the end of January, be sure to contact your school.
 

Education Credits

An education credit helps with the cost of higher education by reducing the amount of tax owed on your tax return. If the credit reduces your tax to less than zero, you may get a refund. There are two education credits available: the American Opportunity Tax Credit and the Lifetime Learning Credit. To claim an education credit, you must file Form 1040 or 1040A with Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits). See Instructions for Student on Page 4 of Form 1098-T for more details.

To see if you qualify for a credit, and for help in calculating the amount of your credit, see Pub. 970, Tax Benefits for Education; Form 8863, Education Credits; and the Form 1040 or 1040A instructions. You can also use the IRS’s Interactive Tax Assistant tool to help determine if you are eligible for these benefits.

Don’t overlook these important credits. Find out more about education credits by visiting the Education Credits Web page on IRS.gov.
 

Monday, July 7, 2014

Earned Income Tax Credit



What Is the EIC?

The Earned Income Credit (EIC) is a refundable tax credit for certain workers.

Who May Claim the EIC?

You may be able to claim the EIC for 2013 if you worked and all  four of the following conditions apply.

1. You (and your spouse, if ling a joint return) have a valid social security number (SSN) issued by the Social Security Administration. For more information on valid SSNs, see Pub. 596, Earned Income Credit (EIC).

2. Your 2013 earned income and adjusted gross income are both under $37,870 ($43,210 if married ling jointly) if you have one qualifying child; under $43,038 ($48,378 if married ling jointly) if you have two qualifying children; under $46,227 ($51,567 if married ling jointly) if you have three or more qualifying children; or under $14,340 ($19,680 if married ling jointly) if you do not have a qualifying child. For a definition of earned income, see the 2013 instructions for Form 1040, 1040A, or 1040EZ.

3. Your ling status on your 2013 tax return is any status except married ling a separate return.

4. You were not a qualifying child of another taxpayer in 2013. If you do not have a qualifying child, you must also meet these conditions. 

a. You, or your spouse if ling a joint return, were at least age 25 but under age 65 at the end of 2013. (You meet this condition if you, or your spouse if ling a joint return, were born after December 31, 1948, and before January 2, 1989.) If your spouse died in 2013, see Pub. 596.

b. You cannot be claimed as a dependent on someone else’s 2013 tax return.

c. Your home, and your spouse’s if ling a joint return, was in the United States for over half of 2013. If you are in the military on extended active duty outside the United States, your home is considered to be in the United States during that duty period and you may be able to claim the EIC.

You cannot claim the EIC if any of the following conditions apply. 

1. Your 2013 investment income (such as interest and dividends) is over $3,300. See Pub. 596 for more information.

2. You le either Form 2555 or Form 2555-EZ (relating to foreign earned income).

3. You were a nonresident alien for any part of 2013 unless you were married to a U.S. citizen or resident and elected to be taxed as a resident alien for the entire year. See Pub. 519, U.S. Tax Guide for Aliens, for more information.

Who Is a Qualifying Child?

Any child who meets all four of the following conditions is a qualifying child.

1. The child is your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them (for example, your grandchild, niece, or nephew). An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption. A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction.

2. At the end of 2013, the child was under age 19 and younger than you (or your spouse, if ling jointly); or under age 24, a student, and younger than you (or your spouse, if ling jointly); or any age and permanently and totally disabled.

3. The child lived with you in the United States for over half of 2013. If the child did not live with you for the required time, there are exceptions if the child was born or died during the year, the child is presumed to have been kidnapped by someone who is not a family member, or there was a temporary absence.

4. The child does not le a joint income tax return for 2013. There are additional rules if a child is married or is the qualifying child of more than one person. For details, see the 2013 instructions for Form 1040, 1040A, or 1040EZ.

How Do You Claim the EIC?

If you are eligible, claim the EIC on your 2013 income tax return. If you have a qualifying child, you must also fill in Schedule EIC and attach it to your Form 1040 or Form 1040A. If eligible, you can claim the EIC to get a refund even if you have no tax withheld from your pay or owe no tax. For example, if you had no tax withheld in 2013 and owe no tax but are eligible for a credit of $800, you must le a 2013 income tax return to get the $800 refund.

More Information

This notice provides the basic requirements to qualify for the EIC. Refer to the instructions for Form 1040, 1040A, or 1040EZ; Pub. 596; or www.irs.gov/eitc for details. You can get IRS forms and publications at IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).

Notice 797 (Rev. 12-2013)

Thursday, March 13, 2014

Self- Assisted Tax Preparation

The South Hampton Roads Earned Income Tax Credit Coalition empowers working individuals and families with low-to-moderate income access free tax preparation and filing services online, at home, at a community center or with the help of a nonprofit partner. See www.shreitc.com for locations and to schedule an appointment.

Not sure you can do your taxes yourself? At The Up Center, Norfolk, Virginia, we can do your taxes or provide whatever level of assistance you might need to do and file your taxes at www.myfreetaxes.com/myfreetaxeshr-com.  Through the MyFreeTaxes Partnership, we provide easy, safe, secure and 100 percent free federal and state tax preparation and filing assistance for qualified individuals.
Sponsored by the Walmart Foundation, in cooperation with Goodwill Industries International, National Disability Institute, and United Way Worldwide, the partnership’s online and in-person tax preparation and filing services have helped millions of families claim nearly $8 billion in tax credits and refunds since 2009. Tax filing software is provided through MyFreeTaxes.com and powered by H&R Block.

 
Carla Skinner of Norfolk, Virginia, came to The Up Center recently for tax assistance. She states, “Preparing my taxes with a tax professional next to me gave me confidence that I would get the tax credits that I was due and that my return would be accurate  … it was an enjoyable experience”.

Wednesday, February 12, 2014

Tuesday, February 4, 2014

IRS2Go Mobile App

Now Available - 2014 Version of IRS2Go!
This new version of IRS2Go has a brand new look and feel with new added features. It is available in both English and Spanish.
 
 
Refund Status
You can check the status of your federal income tax refund using IRS2Go. Simply enter your Social Security number, which will be masked and encrypted for security purposes, then select your filing status and enter the amount of your anticipated refund from your 2013 tax return. A status tracker has been added so you can see where your tax return is in the process. If you filed your return electronically, you can check your refund status within a 24 hours after we receive your return. If you file a paper tax return, you will need to wait about four weeks to check your refund status because it takes longer to process a paper return.


Tax Records
You can request your tax return or account transcript using your smartphone. IRS2Go allows you to request this information, which will be mailed to you within several business days.


Free Tax Prep Providers
The IRS Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE) Programs offer free tax help for taxpayers who qualify. You can use this brand new tool to help you find a VITA site right near your home. You simply enter your zip code and select a mileage range. To make it even more convenient if you click on the directions button within the results the maps application on your device will load with the address, making it easy to navigate to your desired location.


Stay Connected
You can interact with the IRS by following us on Twitter, watching helpful videos on YouTube, sign up for email updates, or contact us.


Download the IRS2Go App
If you have an Apple iPhone or iTouch, you can download the free IRS2Go app by visiting the iTunes app store. If you have an Android device, you can visit Google Play to download the free IRS2Go app.


IRS2Go reflects IRS’ commitment to help you get the information you need — whenever you need it, wherever you are. The IRS shares the latest information on tax law changes, initiatives, products and services through various social media channels

Wednesday, November 13, 2013


worked full-time, part-time or anytime in 2013?

you may be eligible for federal tax dollars!

 

If you have been hit by the economic downturn, knowing that you may qualify for thousands of dollars in federal tax credits is great news!  Even if you never qualified before, you could be eligible now!

The Earned Income Credit and Child Tax Credit are tax benefits for people who earn low to moderate incomes. If you worked in 2013, then you may be eligible!

How much is the Earned Income Credit (EIC) worth?

· If you lived with a qualifying child* for more than half the year, and you earned less than $37,870 ($43,210 if married), you can claim up to $3,250 in EIC benefits.

· If you lived with two children and earned less than $43,210 ($48,378 if married), you can claim up to $5,372.

· If you lived with three or more children and earned less than $46,227 ($51,567 if married), you can claim and EIC up to $6,044.

· Workers not raising a family may be eligible for up to $487 if they earned less than $14,340 ($19,680 if married) and are between the ages of 25 and 64.

What about the Child Tax Credit (CTC)?

Workers raising children can maximize their tax credit benefits by claiming the CTC, worth up to $1,000 for each child under the age of 17. To be eligible for the CTC, a worker must have taxable earned income above $3,000 in 2013.
 
 
Workers can even get FREE tax filing assistance!

Keep the tax credits you’ve earned in your pocket. Instead of paying to get your tax return filed, you can get free help filing your tax return through the IRS sponsored program VITA (Volunteer Income Tax Assistance). VITA volunteers are trained to help workers claim tax credits for which they are eligible.

 
Understanding the EIC and CTC
Janet, who was laid off this year from her job as a real estate agent, will get the boost she needs from the EIC and CTC.  As a single mother of two     children, both under the age of 17, Janet earned $41,500 in 2012 and was ineligible to claim the EIC.
Janet worked for six months before being laid off, and was unable to find another job.  Her total income during 2013 was $19,250. When she files her tax return, she will receive an EIC worth $4,977.
Janet will also be eligible for a CTC, worth $2,000. These credits offset any income taxes she owes, and she will be able to use the remaining balance from the refund to keep up with her family’s needs.