If this is your first time filing your tax as a single parent, we are sure that you have question about your filing status and what potential deduction and tax credit you’ll qualify for. We have come up with five tax breaks you should consider:

1. File as “Head of Household”

There are two benefits to file as a “Head of Household”. First, you’ll pay less taxes overall and second, you’ll also be able to claim a higher standard deduction. Generally you are qualify for “Head of Household” status if you were unmarried on the last day of the year, you provided more than 50% of the funds needed to maintain your household, and your children lived with you for more than half the year. If you have any question please feel free to contact us and we can help you step by step and try to get you the benefits you should be qualified for.

2. The Dependent Exemption

If you are a single parent and you file as “Head of Household: for 2012 you’ll be able to claim an exemption of $3,700 for yourself and each qualifying child. This means that for each examination, $3,700 of your income would not be taxed. Keep in mind that only one of the parents can claim the child as a dependent for tax purses. Parents who share approximately equal custody of the child will need to determine themselves who will claim the child.

3. Child Tax Credit

Child Tax Credit is different from an The Dependent Exemption because as a credit, it is subtracted from the total amount of taxes you owe, and can be add up to substantial savings. For each child you can take a maximum credit of $1,000. There is certain requirements set forth by IRS in order for your to qualify for Child Tax Credit, one requirement is the child must be under age 17 on the last day of the year. Call us at 718-558-5532 if you have any question, and we can help you and explain you the laws in more details.

4. Child Care Credit

If someone else cared for your child so that you could either work or look for work, you may be eligible for Child and Dependent Care Expenses. In order to qualify, though, your child must be have been under the age of 13 for at least part of the year. In addition, the person who was responsible for taking care of your child can not be the child’s other parent or anyone who can claim you as a dependent. Also, in order to be eligible for the Child Care Credit, you must have actually earned an income during the year.

5. Earned Income Tax Credit

This credit was designed to help low-income, working families. Even if you did not earn enough money to owe taxes, you may be eligible for a refund through the Earned Income Tax Credit.

 EITC Homepage–It’s easier than ever to find out if you qualify for EITC

EITC, the Earned Income Tax Credit, sometimes called EIC is a tax credit to help you keep more of what you earned. It is a refundable federal income tax credit for low to moderate income working individuals and families. Congress originally approved the tax credit legislation in 1975 in part to offset the burden of social security taxes and to provide an incentive to work. When EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit.
To qualify, you must meet certain requirements and file a tax return, even if you do not owe any tax or are not required to file.

EITC Assistant–Find out if you qualify for EITC this year

Find out if you are eligible for EITC by answering questions and providing basic income information. The EITC Assistant also estimates the amount of your EITC. 
Quick Guide to Topics on this Page (please scroll down for the following topics and more)

·         Do You Qualify for EITC?

·         Need Help Preparing Your Return?

·         Find information on EITC and other Public Benefits and Other Child-Related Tax Benefits

·         Other Resources and Tips for Claiming EITC

·         Resources and Tips if You Receive a Notice from IRS or are Audited

·         IRS Reports on EITC

Missing Children Link

Do You Qualify for EITC?

To qualify for EITC you must have earned income from employment, self-employment or another source and meet certain rules. Also, you must either meet the additional rules for workers without a qualifying child or have a child that meets all the qualifying child rules for you.

Qualifying Child Rules

If you and your spouse, if filing a joint return, meet the EITC rules for Everyone and you have a child who lives with you, you may be eligible for EITC. Your child must pass the relationship, age, residency, and joint return tests to be your qualifying child. All four tests must be met for each child you claim. 

Rules for those without a Qualifying Child

If you and your spouse, if filing a joint return, meet the EITC Rules for Everyone and you do not have a qualifying child, you may be eligible for EITC.

EITC Income Limits, Maximum Credit Amounts and Tax Law Updates

Special EITC Rules

Special EITC rules for members of the military, ministers, members of the clergy, those receiving disability benefits and those impacted by disasters.

Disability and EITC

Many persons with disabilities or persons having children with disabilities qualify for the Earned Income Tax Credit or EITC. 

Need Help Preparing your Return?

Be prepared to get the EITC you earned.

Gather your important documents and make sure you have all the information you need to claim EITC.

Free Help Preparing your Return

Visit a volunteer site. Trained community volunteers can help you by preparing your return and determining if you qualify for the EITC and other refundable credits.

EITC and other Public Benefits

Refunds received from Earned Income Tax Credit (EITC or EIC), Child Tax Credit (CTC) or any other tax credit are not considered income for any federal or federally funded public benefit program. Also, under the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010, your credit or other tax refund is not counted as a resource for at least 12 months from when your receive it. If you save your refund, federal or federally funded agencies will not use it to determine your eligibility or the amount of your benefit. This new rule is for refunds received after December 31, 2009 and through 2012. It is always best to check with your local benefit coordinator to find out if your benefits fall under this provision.

Don’t Overlook State and Local Credits

If you qualify to claim EITC on your federal income tax return, you also may be eligible for a similar credit on your state or local income tax return. Twenty-two states, the District of Columbia, New York City, and Montgomery County, Maryland, offer their residents an earned income tax credit.