tax credits

I made a mistake on my tax return, what should I do?

If you made a mathematical error on your return, often times the IRS will automatically fix the error.  After correcting the mistake, the IRS will send you a notice that shows the changes made to your return (usually a CP11 or CP12).  Before correcting your return for a mathematical error, you may want to call the IRS at 1-800-829-1040 to see if they have fixed it for you.

If you forgot to include a form or schedule to your return, it is very likely that the IRS will send you a notice requesting just the missing form(s) and/or schedule(s) which means you will not need to do anything other than send in the requested items.

By |Nov 16, 2010|Categories: Uncategorized|Tags: , , , , , |

Education Credits, The New American Opportunity Credit

dreamstime_5315071For tax years 2009 and 2010 undergraduate students may qualify for the Hope Credit (now called the American Opportunity Credit) for four years instead of two and be eligible for a refund of this credit up to 40% of the credit. Also what qualifies as education expenses for the Hope Credit has been expanded. This is great news since the Hope Credit offers the largest amount of credit – up to $2,500.00 per student.

Previous to tax year 2009, this credit was only available for the first two years of undergraduate education, was not refundable, and was limited to $1,800.00 per student. Also previous to 2009 books and supplies for school did not count as part of qualified education expenses. Now for a student’s first four years at a qualified educational institution, the credit has been expanded to include both tuition expenses as well as books and supplies.

By |Feb 8, 2010|Categories: Tax Law|Tags: , , , |

Tax Credits Questionable Solution to Health Care Funding

Buried within most of the variants of President Obama’s proposal for extending health care to 47 million uninsured Americans is the notion that tax credits will somehow provide the financing. Tax credits have become popular with politicians in recent years because they look, superficially, revenue neutral. They are not.  A tax credit is money the Treasury never receives, which otherwise would have gone into the government’s general operating fund. If that operating fund could not have underwritten a given subsidy after tax collection, it will experience a budgetary shortfall if it never receives the taxes in the first place.

By |Aug 24, 2009|Categories: Tax Law|Tags: , , , |