Family

  • Child Tax Credit
  • Filing Status
  • Dependents
  • Standard Deduction
  • Divorce
  • IRS tax Information
  • Home Equity Loan Tax Deductions
  • Medical Expenses
  • Retirment
  • Mileage Deductions
  • Address Change

 

Child Tax Credit-  

The maximum amount you can claim for the credit is $2,000 for each child who qualifies you for the CTC, year 2020.

Your Child must have the required SSN. The required SSN is one that is valid for employment and that is issued by the Social Security Administration before the due date of your 2020 return.

 

Qualifying Relative

Dependents:  A dependent is qualifying child or a qualifying relative. You are allowed one exemption for each person you can claim as a dependent.

A Qualifying child or a Qualifying relative must be a U.S. citizen. or a resident of the U.S., Canada, or Mexico. and if married, must not file a joint return unless filing only to get a refund and a tax liability does not exist for either filer.  If you (or your spouse if filing jointly) can be claimed as a dependent on someone else’s return  you cannot claim anyone as a dependent.

 

FIVE FILING SATATUS:

Filing Status Check only the filing status that applies to you. The ones that will usually give you the lowest tax are listed last.

  • Married filing separately.
  • Single.
  • Head of household.
  • Married filing jointly.
  • Qualifying widow(er).

Filing Requirements or Standard Deduction

IF your filing status is . .

AND at the end of 2020 you were* . . .

THEN file a return if your gross income** was at least . .

Single

under 65.

65 or older

$12,400

14,050

Married filing jointly**

under 65 (both spouses) 65 or older (one spouse) 65 or older (both spouses)

$24,800

26,100

27,400

Married filing separately

any age

$5

Head of household

under 65 65 or older

$18,650

20,300

Qualifying widow(er)

under 65 65 or older

$24,800

26,100

 

 

2020 Standard Mileage Rates: for Business, Medical and Moving Announced.

Beginning on January 1, 2020, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 57.5 cents per mile driven for business use, down one half of a cent from the rate for 2019,
  • 17 cents per mile driven for medical or moving purposes, down three cents from the rate for 2019, and
  • 14 cents per mile driven in service of charitable organizations.

 

Home Equity Loan Tax Deductions: If you took the loan out to buy a second home or to improve your home. If you are able to deduct your home equity loan interest, add that amount to your Schedule-A. The interest on most home equity loans is tax deductible.

 

Whose medical and dental expenses can you include:

You can include medical and dental bills you paid in 2020 for anyone who was one of the following either when the services were provided or when you paid for them.

  • Yourself and your spouse.

  • All dependents you claim on your return.

  • Your child whom you don't claim as a dependent because of the rules for children of divorced or separated parents. 

  • Any person you could have claimed as a dependent on your return except that person received $4,300 or more of gross income or filed a joint return.

  • Any person you could have claimed as a dependent except that you, or your spouse if filing jointly, can be claimed as a dependent on someone else's 2020 return.

Retirement: Individual Retirement Arrangements (IRAs)

For 2019, you can contribute a total of $9,000 to your IRA. This is made up of the maximum deductible contribution of $3,500; a nondeductible contribution of $2,500; and a $3,000 qualified reservist repayment. You contribute the maximum allowable for the year. Since you are making a nondeductible contribution ($2,500) and a qualified reservist repayment ($3,000), you must file Form 8606 with your return and include $5,500 ($2,500 + $3,000) on line 1 of Form 8606. The qualified reservist repayment isn’t deductible.

Who Can Take This Credit:

You may be able to take this credit if you, or your spouse if filing jointly, made (a) contributions (other than rollover contributions) to a traditional or Roth IRA; (b) elective deferrals to a 401(k), 403(b), governmental 457(b), SEP, SIMPLE, or to the federal Thrift Savings Plan (TSP); (c) voluntary employee contributions to a qualified retirement plan, as defined in section 4974(c) (including the federal TSP); (d) contributions to a 501(c)(18)(D) plan; or (e) contributions, as a designated beneficiary of an ABLE account, to the ABLE account, as defined in section 529A. However, you can’t take the credit if either of the following applies. 

The amount on Form 1040, 1040-SR, or 1040-NR, line 11, is more than $32,500 ($48,750 if head of household; $65,000 if married filing jointly).

 

Address Change:

You need  to notify the Internal Revenue Service if you changed your home mailing address. If this change also affects the mailing address for your children who filed income tax returns.

 

Divorce:

Many things may change after a divorce, especially when it comes to your taxes.

  • For tax purposes, if you are divorced or legally separated as of December 31, you are considered to be unmarried for the entire year.
  • If divorced or legally separated, your filing status is single unless you qualify to file as head of household.
  • The custodial parent, or the parent with whom a dependent child lives, does not lose the head of household filing status by allowing the non-custodial parent to claim the exemption for a dependent child.
  • When newly divorced, be sure to change your Form W-4, Employee’s Withholding Allowance Certificate, to reflect your new filing status. If your name has changed, be sure to notify the Social Security Administration (SSA) as well. The IRS will delay processing your tax return if the name does not match what the SSA has in their files.