We’ve started to prepare our taxes, and it’s not pretty. Looks like we didn’t pay the correct percentage to the federal government last year and we’re going to have to write a big fat check. And we were looking forward to getting a return. But at least the process is painless – through TurboTax.com.
Over the past few years we’ve enjoyed using this program because it’s so user friendly thanks to the EasyGuide process. If you want to check it out for yourself, you can prepare your taxes for free. You only pay when you file.
I asked TurboTax to provide us with Commonly Asked Tax Questions. Here are a few of the most popular ones:
1) Who can I claim as a dependent?
Your significant other is probably many things to you—but is he or she also a tax deduction? The question of who you can claim as a dependent has confused taxpayers for years.
The short answer: You can claim a “qualifying child” or “qualifying relative” if they meet specific requirements related to residence, relationship to you, age, financial support provided and income. And yes, you may be able to claim a girlfriend, boyfriend, domestic partner or friend as a qualifying relative in some cases. Claiming dependents can give you a tax deduction worth up to $3,800 per dependent and also make you eligible for many other tax deductions like the Earned Income Tax Credit.
2) What is the Earned Income Tax Credit and How Do I Claim it?
The Earned Income Tax Credit is a tax credit for low to middle income wage earners that has lifted nearly 7 million people out of poverty, however many people still miss it. Why do so many people miss it? Many think they don’t make enough to file their taxes so they don’t claim it. You have to file your taxes to get this valuable tax credit, which may help a family with three dependents receive a credit worth up to $5,891.
3) Does healthcare reform impact my 2012 taxes?
There’s been a lot of confusion about healthcare reform and taxes. Rest assured, the requirement to purchase healthcare does not impact your 2012 or 2013 taxes. You do not have to purchase health insurance until January 2014 and there may be a few exceptions based on income, religious beliefs, and citizenship. You will not see changes to your taxes related to the purchase of health insurance until your 2014 taxes are filed in 2015 if you buy healthcare coverage at a health insurance exchange.
For the complete list, visit this blog post.
If you’re like me and are just now thinking about doing your taxes, you will like this giveaway.
One lucky reader will receive a voucher for a free TurboTax Deluxe Federal + State with e-file!
TurboTax provided codes for review and prizing.