1040 Tax Credits

Tax Year: 2018
Prerequisites:  None

Course Description:

The Internal Revenue Code offers numerous tax credits for individuals, families and many different types of businesses and industries. Although these credits cover many different situations, they all have the common goal of reducing the taxes otherwise payable by the recipients.

In this course, we will discuss the following tax credits for individuals and families:

  • Foreign Tax Credits
  • Credits for child and dependent care expenses
  • Education credits—the American Opportunity Credit and the Lifetime Learning Credit
  • Retirement Savings Contributions Credits
  • Child Tax Credits
  • Residential Energy Credits
  • Earned Income Tax Credits
  • Premium Tax Credits
  • Credits for Excess Withheld Social Security and Tier 1 RRTA tax

The course will focus on the credit section of Form 1040 and the more common credits you might see in your tax practice. We will discuss the Earned Income Tax Credit but will focus mainly on your responsibility as a tax preparer when a client qualifies for the credit. Tax credits can be very helpful to reduce your client’s tax liability. Knowing the rules for each credit can drastically reduce a client’s tax liability.

 Learning Objectives:

Upon conclusion of this course, you will be able to:

  • identify the three methods available on Form 1040 for reporting foreign taxes paid, and the limits on claimable amounts and carryover if Form 1116 is not filed
  • identify the conditions that must be met for a taxpayer to be eligible to claim the child and dependent care credit
  • recognize the differences between the American Opportunity Credit and the Lifetime Learning Credit and taxpayer eligibility criteria for each
  • identify taxpayer eligibility criteria for the Retirement Savings Contribution Credit
  • identify taxpayer eligibility criteria for claiming the Child Tax Credit and Additional Child Tax Credit
  • identify taxpayer home improvements that qualify for the Residential Energy Credit
  • identify the conditions that must be met for a taxpayer to claim the Earned Income Credit, and the due diligence requirements for tax practitioners who file such claims
  • recognize the options available for taxpayers who are eligible to claim the Premium Tax Credit to offset their healthcare costs, including the requirement to report any changes in circumstances that occur during the year
  • recognize when a client has excess social security and Tier 1 RRTA tax withheld and determine the amount of the available credit

Revised date: Nov 2018

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