Liberty Tax Service in Vernon Tackles Healthcare Penalty & More
(VERNON, CT)- January 18, 2015- Procrastinators rejoice! This year, the last day to file income taxes is Monday, April 18, 2016 due to the celebration of Emancipation Day. But the experts at Liberty Tax service in Vernon advise against waiting until the last minute.
“The Affordable Care Act has changed the way millions of tax returns are prepared,” said Attorney Henry Weatherby, owner of Liberty Tax in Vernon. “More and more people are seeking assistance to explain and breakdown how tax credits, deductions and penalties can affect their income tax return.”
In addition to healthcare, Weatherby tackles the top 6 filing questions:
Q: “How quickly can I get my refund?”
Generally, within 24 hours or same day a no cost advanced refund loan of $750 is available for qualifying individuals from Liberty Tax as soon as the same day as filing. This offer is in place until February 29, 2016. How soon your full refund is available will depend on the how complex your return is and the IRS’s processing time. Many see their full refund in about 21 days.
Q: “Who can I claim as a dependent?”
A: If your retired mother-in-law moved in last year and your unemployed adult son attends college locally while living at home, can you claim them as dependents? Possibly. It is best to check with a tax advisor to see who in your household qualifies as a dependent because there are so many variables, such as your relationship to the dependent and the amount of support provided. Typically, if you are head of household, you get a tax deduction for children who live with you and your spouse. For a more complete list of eligible dependents, visit the Liberty Tax website.
Q: “What is the Earned Income Tax Credit (EITC) and how do I claim it?”
A: The earned income tax credit was established in 1975 as a tax boost for low- to moderate-income families, especially those with children. Because the EITC is a refundable credit, it can reduce or eliminate tax. To be eligible, you must meet certain criteria. For example, you must have some form of earned income and you must meet certain income limits. For 2015, the adjusted gross income limits are $47,747 ($53,267 married filing jointly) for a family with three or more qualifying children.
Q: “Will health care affect my taxes?”
A: You bet. The Affordable Care Act (ACA), requires that every American or legal resident have health insurance as of January 1, 2015. If you or any of your dependents do not have insurance, you may face a penalty that is $325 per adult and $162.50 per child or 2% of your total income if that is more than the minimum penalties. There is a cap on the maximum penalty that a family must pay. You may qualify for a coverage exemption. In either case, you will need to submit insurance (or exemption) information with your tax return.
Q: “What documents do I need when I file my taxes?”
A: A few key items are listed below, but you can find a more thorough tax preparation checklist on our website.
- W-2 Form. If you worked for an employer who reported your annual wages to the IRS, you should receive a W-2 by the end of January.
- Form 1099. You should receive a 1099 from anyone you worked for as an independent contractor. You will also get one if you have a retirement pension or took a distribution from your 401K plan or received dividends or other investment income.
- Receipts. Make sure you have documentation for every charitable contribution you made, whether it is a cancelled check, statements from your church, bank or credit cards, or acknowledgment letters from organizations to which you’ve given money or goods. The documentation should include your name, the dates and the amounts are listed.
- Form 1095 A, B or C. These forms show proof of health insurance. An exemption certificate number (ECN) will be required if you applied for a health care exemption in the Marketplace.
- Form 1098. If you own a home, you will receive a 1098 for mortgage interest paid. You should also receive this for post secondary education expense.
- Overlooked tax deductions. Some expenses might be deductible that you didn’t realize. Overlooked tax deductions include job search expenses if you were unemployed for all or part of the tax year, membership in professional organizations related to your work, and unreimbursed employee expenses (such as uniforms). Children 18 to 24 who are students may in most cases be taken as a dependent on their parent’s return.
Q: “I didn’t make much last year; do I need to file a tax return?”
A: According to the IRS, you must file a federal income tax return if your income is above a certain level, which varies depending on your filing status, age and income. There are other variables as well, including whether you’re claimed as a dependent on someone else’s return. A few examples; if your filing status is Single, the Minimum Gross Income Requirement is $10,300. If you are married, it is $20,600. Even if you do not meet the minimum income level, if tax was withheld you should file to get the refund and possibly the earned income credit if you qualify.
Weatherby also shared key tax filing dates:
January 19: First day the IRS will accept electronic or paper tax returns.
January 31: All Form 1095-A’s for Health Insurance Marketplace are expected to be released.
January 31: Last day to enroll in 2016 Affordable Care health coverage.
April 18: Last day to file taxes or apply for a 6-month filing extension.
Since 2006, Liberty Tax of Vernon at 243 Hartford Turnpike in Vernon has assisted with personal and business income tax preparation, filing and service from simple to complex. Liberty Tax of Vernon professionals provide 100% guaranteed accuracy for your biggest refund and complete satisfaction. Hours are: Monday through Friday 8AM to 8 PM Saturday 9AM to 5 PM Sunday and other times available by appointment.
For more information call 860-875-7700.