EIC/ACTC
Who may qualify for the Additional Child Tax Credit?
Earned income greater than $3000, or those with 3 or more QC for Child Tax Credit purposes whose Child Tax Credit was limited by their tax liability.
Why are credits valuable to taxpayers?
They reduce tax dollar for dollar.
Name 4 qualification for the AOC
Eligible student who is the TP, Spouse or dep claimed on the return
Can't file MFS
Must be for the first 4 years of post-secondary ed
Must be in the income threshold
Can a dependent contribute to an IRA?
YES!
Who is an eligible educator?
someone who worked at least 900 hours during the school year as a teacher, teacher's aide, counselor or administrator in an elementary or secondary school.
If a taxpayer has no children, she must have earned income less than $15010. What 4 qualifications must she meet to claim EIC?
at least 25 but not yet 65
Live in the US over half the year
Not a dependent
Investment income < $3450
What is the difference in refundable and non-refundable credits?
Non-refundable can only take your tax liability to zero. Refundable can produce a refund.
What is the maximum Lifetime Learning Credit allowed per return?
$2000
Who is eligible to contribute to a traditional IRA?
Any taxpayer who has not reached 70-1/2 at the end of the year and who has received compensation during the year.
What are 4 adjustments that can be claimed on 1040-A?
Educator
Student Loan Interest
IRA contributions
Tuition and fees deduction
Name 2 credits/deductions that MFS taxpayers may not claim
EIC
Education benefits
Student Loan Interest
Traditional IRA deductions
Child and Dependent Care Credit
What is the purpose of Form 1095-A?
Marketplace coverage with advance premium tax credit
What is the maximum Tuition and Fees deduction?
$4000
What is the IRA contribution limit for 2017?
$5500/$6500 if over age 50
How much can an eligible educator deduct for qualified classroom expenses as an adjustment to income?
$250
Chris is 23 and has earned income of $9486. He is not a full time student, and has no other income. He lived in the US all year, and is no one's dependent. He has a valid SSN and is filing S. Does he qualify for EIC?
NO
How does a taxpayer's contribution to his company's dependent care benefit effect his Child and Dependent Care Credit?
Expenses eligible for the credit are reduced by the amount of the pre-tax contribution.
How do tax-free funds impact qualifying expenses for the AOTC?
Expenses must be reduced by this amount.
Why is it important to distinguish between taxpayers who are active participants in an employer-maintained retirement plan and those who are not?
They have different allowable deduction amounts sometimes.
Who may not claim a student loan interest deduction?
A dependent, or someone who filed MFS
Joe is 64 and is a Single taxpayer. He has gambling income of $2000, Capital Gains of $6500 and Rental income of $3000. Is he eligible for EIC?
NO
Put these 3 credits in the proper order as they appear on the 1040A
Child and Dependent Care Credit
Child Tax Credit
Education Credits
Child and Dependent Care
Education
Child Tax Credit
Order the 3 education benefits by order of preference on the tax return (USUALLY)
AOC
LLC
T&F
Are early distributions from qualified retirement plans always penalized?
NO, there are exceptions.
Bonus $300:
Name 2 exceptions to penalty
Which of the following is not considered a qualified student loan?
Credit card
Credit union bank loan
Loan from Grandma
Loan from Grandma