Six Tax Breaks For Parents – Miami Florida Accountants
Tax season is right around the corner, as Americans scramble to organize paperwork, collect 1099s and find their dedicated accountants before April deadline hits. Everyone has their own set of tax brackets, deductions and so on, but parents have a unique tax breaks only for them. Whether you have a toddler or an adopted 10-year old, you’re probably eligible to get some money back this tax season. Continue reading as the Florida accountants help you understand tax breaks for parents a little better.
Pregnancy-related tax breaks
If 2019 brought you a new bundle of joy, and you paid out of pocket for the related medical expenses you can itemize all of that as deduction. The expenses have to be at least 10% of your adjusted gross income. You can include prenatal care, childbirth and the like. Even your first trimester’s expenses such as general physical examination, weight monitoring, blood tests and urine analysis can be deducted. All you have to do is gather all your receipts for all your hospital stays, medication purchases, even health insurance premiums to prepare your federal income tax. Total all of the amounts and subtract the 10% and only what’s left is deductible as an itemized deduction.
Child tax credit and adoption tax credit
The child tax credit pays up to $2,000 for every child under the age of 17 years old, depending on your income. Even if your child is born in very late December, you can still claim for that year. The Miami accountants want you to know that $1400 of that credit is refundable, even if you don’t owe taxes or owe less than $1,400.
About 150,000 adoptions happen every year in the U.S., including about 50,000 foster-care adoptions. The process to adopt is lengthy and costly, so the adoption tax credit comes in to help with expenses worth up to $14,080 to help cover adoption fees, court and attorney fees, travel expenses and the like.
Child care tax credit
Child care can be very expensive, depending on where you live. According to an article on CNBC, the cost of child care has tripled since 1990, which is more than overall inflation. In 2019, the annual price of infant child care in a center was $9,312. In Oregon, it was $13,518. Care.com averages out between $199 to $213 per week. If your child is 13 years old and younger, and you’re working or looking for work, than you qualify for the child and depended care tax credit. The amount of expenses used to calculate the credit can be no more than $3,000 for one qualifying individual and no more than $6,000 for two or more qualifying individuals.
Tax Breaks For Parents – Head of household status
If you’re single and have a kid, you can file as a head of household to be eligible for a lower tax rate versus filing as single. To qualify, you have to be unmarried by December 31st, contribute over 50% to financially support the household, and have a dependent living with you for over 6 months.
American opportunity tax credit
The Florida accountants want you to know that if your child is in college, you can claim up to $2,500 for tuition for four years. The income threshold for individual parents is $80,000; married couples must earn no more than $160,000.