With tax season in full swing you are probably starting to work on your personal return or getting ready to discuss your personal return with your CPA. One thing to keep in mind this year are tax credits; they’re real, they are valuable and you should take all you are entitled to.
Tax credits are great because they subtract, dollar for dollar, the amount you owe. Deductions reduce the income in which the tax is calculated, thus typically making a credit more advantageous. There are two types of credits: 1. nonrefundable and 2. refundable. A refundable credit is one which reduces your tax liability, sometimes below zero, resulting in a refund to you.
Family and Dependent Care Credits:
- Earned Income Tax Credit
- Child and Dependent Care Credit
- Adoption Credit
- Child Tax Credit
- Credit for Other Dependents
- Credit for the Elderly and Disabled
Income and Savings Credits:
- Earned Income Tax Credit
- Saver’s Credit
- Foreign Tax Credit
- Excess Social Security RRTA Tax Withheld
- Credit for Tax on Undistributed Capital Gain
- Non-refundable Credit for Prior Year Minimum Tax
Homeowner Credits:
- Residential Energy Efficient Property Tax Credit
- Low-income Housing Credit
Health Care Credits:
- Premium Tax Credit (Affordable Care Act)
- Health Coverage Tax Credit
Education Credits:
- American Opportunity Credit
- Lifetime Learning Credit
Michigan Credits:
- Earned Income Tax Credit
- Homestead Property Tax Credit
- Home Heating Credit
- Credit for taxes paid to another state
- Farmland Preservation Tax Credit
As a firm, we educate our clients of their respective and potential tax credits and qualifications. If you would like to review what strategic tax opportunities exist for your set of circumstances and determine eligibility to the credits above, please reach us HERE or give us a call at 248-934-0550. We are here to help and appreciate hearing from our current and future clients.
