Did you know that free tax return preparation assistance is available for eligible military members and their spouses? The Volunteer Income Tax Assistance (VITA) program provides free tax advice as well as tax preparation, filing and other tax assistance to military members and their families.

Here is some helpful information for military members to keep in mind during tax season:

Tax Sites:

Volunteers at military-based VITA sites are trained to help with military-specific tax issues, such as combat zone tax benefits and the Earned Income Tax Credit guidelines.

Bring the following records:

To receive free tax assistance, you should bring the following records to your military VITA site:

• Valid photo identification
• Social Security cards for you, your spouse and dependents or a Social Security number verification letter issued by the Social Security Administration
• Birth dates for you, your spouse and dependents
• Wage and earning statement(s) like Form W-2, W-2G, 1099-R
• Interest and dividend statements (Forms 1099)
• A copy of last year’s federal and state tax returns, if available
• Checkbook for routing and account numbers for direct deposit
• Total amount paid for day care and day care provider’s identifying number
• Other relevant information about income and expenses

Dealing with joint returns:

If your filing status is Married Filing Jointly and you want to file your tax return electronically, both you and your spouse should be present to sign the required forms. If it isn’t possible for both of you to be present, a valid power of attorney that allows tax preparation can be used to sign and file the return.

Special exception:

There is a special exception to using a power of attorney for spouses in combat zones. The exception allows  the filing spouse to e-file a joint return with only a written statement stating the other spouse is in a combat zone and unable to sign.

For more information, review IRS Publication 3, Armed Forces’ Tax Guide, available on the IRS Web site at www.irs.gov or order a free copy by calling 800-TAX-FORM (800-829-3676).

Daniel Stoica Accounting Professional

The U.S. government knows that when you are financially responsible for a child or other dependent, you may come into financial difficulties, so the IRS allows you to take a tax credit on your income taxes. It will reduce your tax debt if you qualify for the Child Tax Credit.

If you pay someone to care for your child or other dependent while you work, or look for work, you may qualify for this tax credit. The good news is, by claiming this credit, you may even qualify for a bigger tax refund.

What is the child tax credit?

The child tax credit is a tax credit that depends on the number of dependent children in your  family. The credit depends on your income level as well. 

How do I qualify for this tax credit?

To qualify for this credit, your child or dependent must be under the age of 13. You must also pay someone to care for them while you are working or looking for work, but it must not be a spouse or your own child under the age of 19 years old. This caregive must not be your own dependent. An after school program, such as Boys and Girls Club or YMCA may qualify, but you may not claim regular school expenses.

If you care for your spouse, or any dependent who can’t care for themselves, age is not important in this instance. If you care for a disabled parent or mentally or physically challenged child, they qualify for the tax credit if they lived with you for more than six months out of the year. You are allowed to claim as much as 35% of the expenses you incur to care for them, which is $3,000 for one person or $6,000 for two or more people.

If you are employed and file as single, head of household or married filing jointly, you may apply for the child tax credit. If you receive benefits for child care through your employer, these amounts will be calculated on your return.

Why wouldn’t I apply for this credit?

If you qualify for the child tax credit, there is no reason why you shouldn’t claim it. Take advantage of all of the credits and deductions you can. It will reduce your tax burden or give you a bigger refund come tax time and, frankly, with all of the work you do caring for your child or parent or other dependent, you deserve the tax break.

 Daniel Stoica Accounting Professional

June is unofficially the “wedding month” since that’s when many couples tie the knot. It is also the halfway point to the end of the year, which means keeping your tax changes in the back of your mind.

When you are planning your wedding, your taxes are most likely the last thing on your mind, but there are a few things to think about that will keep tax issues from bothering you while you are concentrating on your big day. If you are currently planning your wedding, or if you just recently got married, look into your new tax situation. You can save some money and maybe even keep an eye out for a possible future refund check.

Once you are married and settled, the first things you will need to take care of are name and address changes. Then, when tax season gets closer, think about whether or not you’ll itemize deductions, which tax return form is right for you and your spouse and what filing status you’ll use. A tax professional can help you with these issues.

There are a few things you should take into consideration as tax time approaches.

-Make Certain You Use Your Correct, Legal Name

You must provide your correct, legal name and identification number to claim exemptions on your tax return. If you changed your name when you got married, make sure you update your Social Security card right away so the number matches your new name when you file your taxes. Use Form SS-5, Application for a Social Security Card.

-Did You Change Your Address?

If you and your spouse have moved to a new address, get a change of address from the Post Office so they can forward any tax refunds or mail from the IRS. The Post Office will also send your new address to the IRS so they can update their records. You should probably contact the IRS, as well, by filing Form 8822.

-Are You Expecting a Refund Check?

Every year, the Postal Service returns thousands of tax refund checks, mainly because the addressee has moved. Notifying both the Postal Service and the IRS of your address change as soon as possible will ensure the delivery of any refund checks you may be waiting for. To check the status of a pending tax refund, go to the IRS web site and use the “Where’s My Refund?” service.

-Your Filing Status Will Probably Change

Your marital status as of December 31st will determine if you are considered married for that tax year. Married couples have the option of filing their federal income tax return either jointly or separately in any given year. Choosing the right filing status can save you money.

Filing a joint return (Married Filing Jointly) allows spouses to use their combined income and take combined deductions and expenses on a single tax return. Both spouses must sign the return. Both spouses are also held responsible for the contents.

With separate returns (Married Filing Separately), each spouse is responsible for their own tax return. Separately, they sign and file, and each is responsible for his or her own tax return. They are taxed on their own income separately, and can only take his or her individual deductions and credits. If one spouse itemizes deductions, the other must do the same.

Which filing status is right for you? It depends on your specific situation. You should consult with a tax professional to determine what situation is best for you and your new spouse.

Daniel Stoica Accounting Professional