Sunday, November 27, 2022

How Can I Get Money Back On Taxes

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Frozen Student Loan Debt

How to get more money back on your taxes

When the pandemic shutdowns went into effect, the U.S. Department of Education froze all public student loan payments and stopped interest from accruing on student loan accounts. While this has been a great benefit to those who were struggling to pay them, it also means the $2,500 above-the-line deduction has been rendered worthless during the freeze. As a result, consumers have had more taxable income remain in their pockets, which, in turn, has led to them receiving a smaller tax refund.

That said, if you’ve been paying private student loans through services like SoFi or Laurel Road, your payments and interest haven’t actually stopped, so if you fall into this category, be sure to utilize this deduction on your tax return.

Can You Get Money Back From Filing Taxes If You Had Zero Income

If you have zero income, it is likely that you did not pay any taxes during the taxable year. It may seem counter-intuitive that you may still be eligible for a tax refund even if you did not earn any money. There are some limited circumstances when you may be able to get money back from filing your taxes even when you had no income.

Tips

  • It is possible to get money back on your tax return even if you had zero income. That being said, these opportunities are quite limited and will be strongly influenced by the specific deductions you are eligible for.

Hidden Ways To Boost Your Tax Refund

OVERVIEW

Here are five tried-and-true ways to reduce your tax liability at tax time. Pay no more than you owe, or even increase your tax refund.

For information on the third coronavirus relief package, please visit our American Rescue Plan: What Does it Mean for You and a Third Stimulus Check blog post.

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While Americans may disagree on how the government spends their taxes, at tax time, many of us are looking for ways to pay no more than we owe or even boost our tax refunds. These strategies go beyond the obvious to give you tried-and-true ways to reduce your tax liability.

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Or You Can Save Money With A Hybrid Strategy

Theres no denying that some people have complicated tax situations that are probably best left to the pros.

The single divorced mom who has a daughter living at home, but the father gets the childs exemption, will not have free filing software get her filing status correct and will reduce or deny the Earned Income Tax Credit, said Rob Burnette, CEO, financial advisor and professional tax preparer at Outlook Financial Center in Troy, Ohio. Taxpayers with rental properties will have difficulty with Schedule E and often get the depreciation for the property wrong.

In those cases, you might consider a hybrid strategy where you use free or budget software to do the easy part and then pay the pros to do only the heavy lifting thats above your weight class.

For complex returns, you can use tax preparation software, which is very assistive and can help you in the majority of cases for a significantly lower fee than an average tax preparer, said Dmytro Serheeiv, tax consultant and co-owner of PDFliner. Using good software, you can significantly reduce your expenses. If something appears to be too tough, you can go to a preparer just with this small chunk and do the rest.

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Will Your Refund Be Delayed

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In the end, how quickly you receive your tax refund depends on when you file your taxes, how you choose to file, and what credits and deductions you might claim. While refunds including EITC and ACTC will be funded no earlier than February 15, you will still benefit by filing early. You are giving the IRS plenty of time to review your return, verify your EITC and ACTC eligibility, and W-2 authenticity, which is required before your return is processed. Additionally, filing with a tax professional who e-files will also save you time.

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The Lifetime Learning Credit

The Lifetime Learning Credit is another education-related tax benefit that can help you lower your taxable income, and lead to a smaller tax bill.

However, unlike the American Opportunity Tax Credit, which is refundable, the Lifetime Learning Credit isnt, meaning that if the credit isnt used in full, you wont get refunded for any remaining amount.

But dont let that fool you. Just because you wont get a refund on any leftover amount, that doesnt mean that you should pass up on this credit.

Sarah York, an IRS enrolled agent and tax expert at Keeper Tax, says that the best thing about the lifetime learning credit is that:

any education-related costs even professional development courses are eligible, and theres no limit on the number of years you can claim it.

In other words, you can take advantage of it beyond your college years, as long as youre taking classes at an accredited institution.

So, how much can you claim?

York says that the credit is 20% of the first $10,000 you spend on higher education expenses, with the maximum amount being $2,000.

To claim the full credit your modified adjusted gross income must be less than $59,000 if filing single, or under $118,000 for joint filers.

You can also claim a partial credit if youre modified adjusted gross income is between $59,000 and $65,000, if filing single, and between $118,000 and $138,000, for joint filers.

To learn more about the lifetime learning credit, .

Bad News: You Do Owe Taxes On Unemployment Benefits But There’s Help

If you received unemployment benefits in 2021, bad news: You do owe income taxes on those benefits, just like you do on ordinary income. Don’t worry if you’re in this situation, however: If you elected to have taxes taken out of your unemployment checks, you’re in good shape.

What if you didn’t do that? First, prepare your income taxes and see how much you owe. Start saving as much as possible as soon as possible so you can afford the tax bill. Next, be proactive and contact the IRS directly to set up a payment plan.

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Example : Late Tax Refund Of Gst Filed Quarterly

You have a GIRO arrangement with IRAS.

IRAS receives the GST return for the period Apr – Jun on 31 Jul with a GST refund claim of $80,000. IRAS is considered to be late if the tax refund is not made by 31 Oct.

If the tax credit is refunded on 3 Nov, interest will be paid on the principal sum of $80,000 for the period 1 – 3 Nov as follows:

$80,000 x 5.5% x 3/365 = $36.16

IRAS will refund $80,000 together with the late tax refund interest of $36.16.

Review Personal Bank And Credit Card Statements

Here’s how to get more money back on your tax return

Although you should never mix business and personal finances, you may have used your personal bank account or credit card to make a business-related purchase throughout the year. Review your personal bank and credit card statements for business expenses you may have otherwise missed. Your business accountant should know how to record these expenses in your books so that they can be reflected on your tax return as a business expense.

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If These Situations Apply You Should File Taxes

If you are not sure whether you meet the threshold for filing a tax return, the IRS has an online questionnaire that will assist you in making that determination. The IRS states that if any of the following situations apply to you, then you should file a return. If not, you do not need to file. If you do not have income, a return should be filed if you had any federal taxes withheld from any payments, if you sold your home, if you owe any taxes for any distributions or excess contributions to a qualified retirement plan or if you owe recapture tax.

Unclaimed Federal Tax Refunds

If you are eligible for a federal tax refund and dont file a return, then your refund will go unclaimed. Even if you aren’t required to file a return, it might benefit you to file if:

  • Federal taxes were withheld from your pay

and/or

You may not have filed a tax return because your wages were below the filing requirement. But you can still file a return within three years of the filing deadline to get your refund.

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Apply For Emergency $1504 Ebt Payments To Be Sent Out In A Week

But, families that did not receive any of the payments will pocket up to $3,600 per child during the 2022 tax season

Monthly child tax credit payments have stopped but its been reported that families could receive a double payment in February.

Read our stimulus checks live blog for the latest updates on Covid-19 relief…

This year the IRS has returned the tax filing deadline to the usual April 15th, up from last year’s May 17.

When filing your taxes this year, things such as unemployment, layoffs, and tax credits may all contribute to your looking different than last year.

For instance: the Child Tax Credit was an advance on the credit you receive when you file taxes every year, not a “bonus.”

Therefore, if you claimed this credit, you may either see a smaller tax credit available per child or possibly owe some money back.

Form 6419 will be the form you want on hand, which will indicate the number of advances you received.

Tax expert Lisa Greene-Lewis joined advised Morning in America Monday that tax reliefs and increases to personal finances from 2020 may be helpful this year.

Cash donations made to charity and using the EITC standing are two of them.

Anyone hoping for another round of stimulus checks altogether may not be out of luck, either, as the Najava Council voted last month to send out a new round of relief with households of two children eligible for up to $5,200.

How Can I Claim The Child Tax Credit This Tax Season

How To Get The Most Money Back On Your Tax Return

If your child qualifies for the tax credit, youll need to file a tax return in order to take advantage of the credit. This applies even if your income is below the limit required to file taxes in the first place.

Additionally, youll need to fill out certain lines on Form 1040. Youll also be required to submit Schedule 8812 alongside your tax return.

This may sound complex, but there are plenty of online tax preparation options to make this a little easier. Online tax filing will help you claim the Child Tax Credit this tax season.

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Checking Income Tax Refund Status On Tin/nsdl Website

You can check your income tax refund status from the official website of Tax Information Network by following these steps:

  • Visit the official website of Tax Information Network or simply click here to access the relevant page.

  • Enter the essential details like PAN number, Assessment Year and captcha.

  • Select the Submit button to view your current income tax refund status.

When Does Netfile Open For 2022

NETFILE opens on Monday, February 21, 2022, for filing personal tax returns for the 2021 tax year. To file online, you must use CRA-certified tax-filing software products that use the NETFILE web service. You can also file previous tax years back to 2015, but returns for tax years earlier than 2014 must be done on paper.

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The Form 30 Format Is As Follows:

I, , of , do hereby state that my total income computed in accordance with the provisions of the Income Tax Act, 1961, during the year ending on being the previous year for the assessment year commencing on the 1st of April , amounted to Rs. that the total income tax chargeable in respect of such total income is Rs. and that the total amount of Income Tax paid or treated as paid under:

Section 199, is Rs. .

I, therefore, request for a refund of Rs. .

I hereby declare that I was resident/resident but not ordinarily resident/non-resident during the previous year relevant to the assessment year to which this claim relates and that what is stated in this application is correct.

Dated:

It is important to note that:

  • This claim should contain a document of proof of return of income in a prescribed form, unless youve already made such a claim to the Assessing Officer.
  • Non-residents whose income is subject to TDS should make the claim for refund to the Assessing Officer, Non-resident Refund Circle, Bombay.

If you have been charged tax under the provisions of Section 192 194, Section 194A and Section 195 on your income , the claim should be accompanied by the necessary certificates recommended under Section 203.

The American Opportunity Tax Credit

Get MORE Money back!! | Filing taxes in 2021| Tax Changes and Coronavirus Affect on Taxes

The American Opportunity Tax Credit is an education-related credit worth $2,500. This credit is only available to students during their first four years of post-secondary education, at any accredited university, college, or vocational institution.

One great thing about the American Opportunity credit is that 40% of it is refundable. That means that you can get a check of up to $1,000 if you dont owe any taxes.

Heres how it works:

You get credit on the first $2,000 you spend on qualifying education expenses, including, tuition and fees, books, supplies, and other course materials. Then you get a credit of 25% for the next $2,000 you spend on qualifying education expenses, which comes out to an additional $500.

Manny Vetti, managing member and co-founder at TaxCure, says:

If you spend at least $4,000 on qualifying educational expenses, your credit will be the full $2,500.

To receive this credit, you must be attending school at least part-time for a minimum of one academic period, and you must be enrolled in a degree-seeking program.

Additionally, your modified adjusted gross income must not exceed $80,000, if filing single, or $160,000 if youre married, filing jointly.

You can also claim partial credit if you earn over $80,000 but less than $90,000, if filing single, or if your income is over $160,000 but less than $180,000, if youre married and filing jointly.

You can learn more about the American Opportunity Tax Credit and how to claim it here.

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How Do I Get My Tax Refund

Luckily for you, the IRS is very good about getting your tax refund to you.

In fact, you can check out the IRSs Wheres my refund? tool to find the status of your tax refund right now. And according to the IRS, they issue nine out of ten refunds back to the taxpayer within 21 days after they file their taxes.

Ultimately, though, how soon you get your refund back depends on two things:

  • How you file your taxes
  • How you elect to receive your refund

If you decide to file your taxes through good old fashioned pen and paper, its going to take considerably longer to get your refund back. In fact, youre going to have to wait four to six weeks before youre even able to check your status on their Wheres my refund? tool.

There is another route though: Electronic tax filings.

You receive your tax refund even faster when you file it electronically via platforms like TurboTax or IRS e-file. There you can elect to receive your refund through direct deposit . Its secure, fast, and the same way the government deposits millions of Social Security and Veteran Affairs benefits each year.

When you get your money back, be sure to put it to good use:

So you know how much youre getting back and how to get your money. Now lets get into what you might be getting WRONG about your tax refund.

Student Loan Cancellations And Repayment Assistance

Pursuant to the American Rescue Plan Act of 2021, the exclusion from income for forgiveness of student loan debt for post-secondary education is significantly expanded for debt discharges after December 31, 2020 and before January 1, 2026. To qualify for this tax-fee treatment, the loan must have been made by a qualified lender to assist your attendance at an eligible educational institution, i.e., one that has a regular faculty, curriculum, and enrolled body of students.

Loans generally are eligible for this tax treatment if made, insured, or guaranteed by federal, state, or local governments or their agencies, as well as educational institutions and certain nonprofit organizations qualifying under section 501 of the tax code. Also, loan cancellation pursuant to governmental programs that forgive student loan debt for service in certain professions and certain employers is tax-free. However, loan cancellation in return for services rendered to an educational institution or lender does not qualify for tax-free treatment.

Already payments and collections on federal student loans are suspended and the interest rate set at zero through September 30, 2021. Also, loan cancellation pursuant to certain governmental programs that forgive student loan debt for service in certain professions and certain employers is tax-free.

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Getting The Most Out Of Your Tax Deduction

Not every business can get a tax refund. However, small-business owners who dont qualify for a business tax refund could still see money back on their individual tax returns. There are also steps you can take to increase the amount of money you get back on your return, such as prepaying expenses and keeping track of tax credits you are eligible for. As with all things tax-related, to get the most bang for your buck, it helps to work with a qualified tax preparer, such as a CPA or enrolled agent.

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