Date post: | 28-Dec-2015 |
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W-2
• A form reporting one’s compensation (taxable wages) for the year.
• Filled out by the employer
1040 EZ• Simplest form used to file your
taxes
• Taxable income must be below $100,000
• Must be single or married filing jointly
• No dependents
• Interest income less than $1,500
Interest Income
• income earned through depositing money in savings programs, buying certificates of deposit (CDs) or bonds, or lending your money
1099-INT
• Statement you receive from payers of interest income (i.e. banks) that summarizes your interest income for the year
1040
• Form used if taxable income is more than $100,000
• Used if you are reporting self-employment income
• You are claiming income from sale of property
1040 A
• Form used for income taxes
• Used if you have capital gain distribution (selling item that was purchased for less than what you are selling it for Ex: property)
• Used if claiming tax credits
Earned Income Credit• Tax credit for certain people that work and have low wages
• Must be single or married filing jointly
• Must be 25—65
• Requirements: – $43,352 ($48,362 married filing jointly) with three or more
qualifying children – $40,363 ($45,373 married filing jointly) with two qualifying children – $35,535 ($40,545 married filing jointly) with one qualifying child – $13,460 ($18,470 married filing jointly) with no qualifying children
Hope Scholarship Tax Credit
• a federal income tax credit based on the first $4,000 in postsecondary education expenses paid by the taxpayer during the tax year.
• provides a tax credit of up to $2,500 per student per year for qualified higher education expenses during the first four years of post-secondary education
Making Work Pay Credit
• Temporary tax credit
• Worth $400
• Must not be claimed by someone as a dependent to be eligible.
Joint Return
• Income tax filing status that can be used by a married couple in which the income and deductions for the two individuals are combined
Deduction
• An item or expense subtracted from adjusted gross income to reduce the amount of income subject to tax
• Examples: Children, childcare expenses, student loan interest, business expenses
Alaska Permanent Fund
• The fund pays an annual dividend to all Alaska residents who meet eligibility requirements ($500-$2000)
• The Alaska Permanent Fund originates from surplus revenues gained from the development of Alaska’s oil and gas reserves.
Nontaxable Combat Pay
• Members of the military only
• Income you earn while performing military service in a designated combat zone is exempt from income tax