Don't know where to even begin filing taxes? Not to worry! TurboTax provided the Q&A below to answer all your most commonly asked tax questions.
With tax season comes tax questions. Whether it's questions about whether you can claim your parent as a dependent or wondering if you can deduct your books for college, experts at TurboTax have answered them all. Here are five most commonly asked tax questions this year:
1. Can I claim my girlfriend/boyfriend on my tax return?
Most of us know you can deduct your children on your tax return, but many people forget that they might be able to deduct elderly parents, significant others or other relatives that also qualify as a dependent. For each dependent you can deduct $3,900 from your federal taxable income, which is likely to reduce your taxes. To quickly find out who qualifies as a dependent on your tax return visit this Dependents Calculator here.
2. What tax deductions and credits are available for parents?
If you had a baby this year, a new child means that you may receive a dependent exemption of $3,900, which reduces your taxable income by that amount (even if you had your baby on December 31, 2013). Other credits available for parents include:
- Child and Dependent Care Tax Credit — If you paid for care you may be eligible for a tax credit worth up to $1,050 for your child.
- Earned Income Tax Credit — This refundable tax credit is available to low to middle-income working Americans and could be as much as $6,044 for someone with three or more children.
- Child Tax Credit — This credit may be worth $1,000 for each of your children under 17.
Learn more about tax deductions and credits you can take if you have kids here.
3. I am in college; can I deduct any of my school expenses?
To combat the ever increasing price of college education, the tax code provides some relief via education tax credits and deductions. You may be able to deduct things like college tuition and fees, books, and supplies for you, your spouse, and dependents. Education deductions and credits include:
- The American Opportunity Tax Credit — Helps parents and students pay for college education by giving them a credit of up to $2,500 for tuition and fees, books, supplies, and equipment.
- The Lifetime Learning Credit — Taxpayers may be able to claim a credit of up to $2,000 per tax return for college tuition, fees, and supplies paid directly to the educational institution.
- Tuition and Fees Deduction — An education benefit which allows you to deduct up to $4,000 for college.
Learn details around the tax benefits that are available for college here.
4. How do I know what tax forms I need to file my taxes?
When you sit down to file your taxes make sure you gather up:
- Tax Forms: There are two common tax forms that taxpayers receive in the mail — a W-2 from your employer or a 1099-INT for bank interest from a savings account. Not sure what forms you should expect, check out our tax forms calc here.
- Social Security numbers for family members: In order to file your taxes, you need the correct social security numbers for yourself, your spouse, as well as for anyone you are claiming as a dependent.
- Receipts for donated items: If you made a charitable contribution within the last year, be sure to gather receipts of your donations to turn your good will into tax time savings. Not sure how much your donated items are worth? TurboTax ItsDeductible will help track and value donated items.
5. I didn't make very much money last year — should I still file my taxes?
People should file a 2013 federal income tax return even if their total income is below the filing requirement in order to get a refund on any withheld federal income tax. Every year, money is left on the table because people don't think they need to file. The average unclaimed tax refund is over $600. One important thing to note — the IRS places a three year window on claiming these past refunds. Check out additional information here.