Filing for the taxes is a job that every adult is aware of and complied to do. It is perhaps one of the most important contributions of a working class or a self-employed individual for the country. You are only subjected to pay these taxes if you’re earning more than a minimum amount,which depends totally on you and your status. If you’re single and under 65 years of age, you are liable to pay the federal taxes if you earn more than $10,300. For qualified widowers 65 years of age or over, the amount is $17,300.For married couples who have filed for marital tax filing status, if the combined income is more than $20,600, then you are liable to pay your taxes.However, this qualifies you to file for a refund in this case, if you don’t have any other taxes overdue, primarily because your employer won’t necessarily with hold taxes. This refund comes from those with holdings.
You can also get a refund through tax credits. There are many kinds of tax credits, with each having different reasons to qualify are fund. Here, we take a look at those tax credits and reasons.
1. Earned Income Tax Credit
This tax credit allows the low-income earning population to hold on more of their paychecks. The way it works is that if your tax obligation according to your status is less than the credit, then you’re eligible to get the refund of the difference of the amount in your credit and tax obligation.
2. Child Tax Credit
For the low wage earners with dependent children, this tax credit may be of help. If your tax obligations are lower than your maximum credits, then you are eligible to file for a refund.There are certain other requirements for this, which you may find at the IRS website.
3. American Opportunity Tax Credit
This tax credit helps you in reimbursing as much as $2,500 per year, for certified education expenses. If you’re paying for your college tuition and aren’t required to be filing are turn, then this tax credit gives you an opportunity to get a hefty refund to help you through your educational process.
4. Lifetime Learning Credit
Yet again, this tax credit can get you refunds up to $2,000 for properly qualified educational expenses. The plus point for this tax credit is that you can file refunds for it for as many years as you want. But you cannot file for this and the American Opportunity Tax Credit at the same time.
5. Premium Tax Credit
This tax credit helps in assuring a longer life for people with lower wages. The tax credit helps the families and individuals with moderate or low incomes to afford healthcare from the Affordable Care Act, which is purchased through the Health Insurance Marketplace.
6. Savers Credit
If you’re saving for your retirement, you may be eligible for some tax credits, depending on the money you’re putting into your savings.
Having these tax credits might help you file for refunds.But make sure that you file for the tax returns even if you earn less than the minimum amount required because there are many other factors that count, and you may end up getting penalties from the IRS. Because you may end up getting these tax credits, which can help you earn some money if your tax amount is zero.