Credits & Deductions

  • IRS Announces August Child Tax Credit Payments Now Being Issued

    The Internal Revenue Service says millions of families across the U.S. should see their advance payment of the Child Tax Credit (CTC) in their bank accounts or mailboxes any day now. This payment is the second in a series of advance monthly payments. The August payment goes out to some 36 million families and is…

  • New Guidance Aimed at Employers Claiming Employee Retention Credit

    New guidance from the Internal Revenue Service aims to help employers better understand the employee retention credit—and how they can qualify for it. The new guidance spotlights employers who pay qualified wages after June 30 of this year and before Jan. 1 of 2022. Additional guidance tries to answer various miscellaneous questions around the credit…

  • COVID Paid Leave Credit Clarified for Employers

    The Internal Revenue Service has updated its guidance on expanded paid sick and family leave tax credits available to employers who provide the leave to their workers. Put in place by the American Rescue Plan Act of 2021, also known as ARP, the credits permit eligible employers to be reimbursed for providing paid sick and family…

  • What Taxpayers Need to Know About Higher Education Credits

    Let’s face it: higher education is expensive, whether it’s community college, a trade school, a four-year university or an advanced degree. That’s where higher education tax credits come in. Credits reduce the amount of tax owed by qualified taxpayers. Some credits are refundable, that is, if a refundable credit reduces tax owed to less than…

  • IRS Explains Educator Expense Deduction

    The Internal Revenue Service has long allowed educators to deduct part of the cost of supplies and other expenses from their taxes. The total deduction allowed may not sound like much, but educators all over the U.S. have come to depend on this tax break for a little relief. The deduction is available for teachers,…

  • Update Bank Info for Advance Child Tax Credit Payments on IRS.gov

    Monthly Advance Child Tax Credit payments are set to begin in two weeks. While it’s too late to change the bank account that will receive the July 15 payment, qualifying taxpayers can now use a tool on IRS.gov to update their information before the August payment is issued. The Internal Revenue Service announced a new feature for…

  • New Online Tools Help Families Manage Monthly CTC Payments

    The Internal Revenue Service has unveiled a pair of new tools to help families manage and monitor advance monthly payments of the Child Tax Credit, made possible by the American Rescue Plan. The new tools join the Non-Filer Sign-up Tool that helps families who aren’t normally required to file an income tax return to file…

  • IRS Issues Guidance for American Rescue Plan Changes to the CTC, EITC, and APT

    The Internal Revenue Service has released guidance for changes to the Child Tax Credit, Earned Income Credit, and application percentage table (APT) that were included in the American Rescue Plan Act of 2021 (ARPA). The APT table is used to calculate a taxpayer’s premium tax credit (PTC) and the required contribution percentage that determines whether…

  • TAS Warns of Ban for Improperly Claiming Some Credits

    The nation’s Taxpayer Advocate wants taxpayers to know there’s a downside to having too much of a good thing. In this case, it refers to making excessive or improper claims to qualify for a number of tax credits. The downside is that the IRS has the ability to ban a taxpayer from claiming any of…

  • Taxpayers Don’t Have to Repay Excess APTC for TY2020

    The American Rescue Plan Act brought a third round of Economic Impact Payment and plenty of changes to tax credits, including how the agency approaches the Premium Tax Credit (PTC). The requirement that taxpayers report and repay any excess advance payment of the PTC on their income tax return has been suspended—but only for tax…