Jun 24

January 2024

I want to take a moment and express my gratitude for your interest in reading my articles.  I hope the information provided has been something of interest to you over these years.  With that, it is time to say good-bye to 2023 and start looking forward to 2024.  As the New Year has arrived, everyone should take a few minutes to make sure that they have all of their paperwork in order for the upcoming income tax filing season.  This is the time to gather together the pertinent information needed to prepare your tax return.  Make sure your employer has your correct address.  Especially, if you have moved during the year, you may have changed it with your current employer, but failed to inform your former employer(s).  Have you had a change in your life, such as marriage, or birth of a child, or a child starting college?  Maybe you have had to step in and take care of a loved one with medical issues and needed full time care.  January is the perfect month to sit down and review the previous year changes and get yourself prepared to have your income tax return prepared.  Of course, everyone starts anticipating when they will get their W2’s and when they expect to receive their refund.  Most employers have the W2’s available the last week of the month.  Officially, they have until January 31st to have them prepared and mailed out.  It just seems natural to take the next couple of weeks and make sure you will have all the documents required to have your return prepared.  Okay, now let’s pick it up a little bit and discuss credits.  There are two types of credits beneficial to the everyday taxpayer, refundable and nonrefundable.  The nonrefundable will reduce the amount of tax owed on taxable income.   The most widely used ones are the Child and Dependent Care, Education, Retirement and Child Tax credits.  Whereas the refundable credits may provide additional tax refund and the most popular ones are the Earned Income, the American Opportunity Education, and the Child Tax credit.  Now, let’s briefly look at each one.  The Child and Dependent Care Credit provides a credit for the care of your younger child(ren) who are under 14 years old or handicap and your dependent.  The Education credit involves the American Opportunity Education Credit or the the Lifetime Learning Credit and these provide a tax credit for you, your spouse, or dependent to attend an accredited college course or approved trade school curriculum.  The Retirement Savings Contribution Credit provides for a credit when you contribute to any type of retirement arrangement.  The Child Tax Credit provides for a reduction of taxes or additional refund if you have dependent children younger than 17 years of age.  And, finally, the Earned Income Tax Credit provides additional refund if your earned income and/or adjusted gross income falls within credit parameters.  On another note, I want to take a moment and remind everyone the discharging of a weapon in a residential neighborhood is unlawful, unless it involves a stand your ground circumstance, only.  In closing, this is my last monthly tax update I will be writing.  Pedro Baldeon, EA is taking over the reins of our tax preparation and representation, accounting, payroll activities, along writing the monthly tax update.  I really appreciate knowing how many of you have read my articles over all these years.  Thank you!!!  We wish everyone a prosperous and healthy 2024!!!  This is a very brief overview. For details and specific assistance in applying the general information in this article, call us at your earliest convenience or contact your tax advisor.   Provided by Tracey C. Higginbotham, E.A., (321) 632-5726, a member of the National Society of Accountants.