Earned Income Tax Credit Tips for Single & Head of Household Filers

Posted by Tax Advisor on March 26th, 2015
Last modified: March 26, 2015

The Earned Income Tax Credit can add a total of up to $6,044 to your tax refund!

Being a single parent is no picnic. Parenthood is a tough gig, especially when you’re on your own.

Raising a family on one source of income is enough of a headache. On top of that, you have dinner to cook, homework to help with, and sports games to attend. It’s clear, you have a lot on your plate and could use more money in your pocket.

Here’s something you must know: to lessen the financial burden of being a single parent, the IRS offers the Earned Income Tax Credit to qualifying tax filers.

Why Your Income Matters

The EITC or EIC is a refundable tax credit that is only offered to taxpayers who earn low-to-moderate income from their job or from being self-employed. That means if you don’t work, you cannot claim the credit.

In addition, once your income goes over a certain threshold, you won’t qualify to receive the tax credit. Read the rest of this entry »

Tax Deductions for Landlords (Part 3)

Posted by Tax Advisor on March 25th, 2015
Last modified: March 25, 2015

Landlords can also deduct rental property depreciation…

In part 1 and part 2 of this article, we explained that the services and expenses that you paid for could be included as deductions on your tax return.

In addition to these expenses, you can deduct the depreciation of your rental property.

In other words, you can deduct the “wear and tear” costs of the rental property, including any improvements.

Confused? No worries! Keep reading and we’ll get to the bottom of what depreciation means, and explain what types of improvements you can include on your tax return.

What Does “Depreciation” Mean?

For tax purposes, you can deduct the cost of your property along with any improvements you made to it, in the form of depreciation.

Think of depreciation as a way to recover the costs associated with your rental property.

You won’t deduct the cost of buying or improving your rental property as one large tax deduction. Instead, you’ll spread the costs across the “life” of the property.

The amount you can depreciate is dependent on a variety of factors, such as how long the property (or improvement) will last and what it is. To learn more, visit IRS Publication 527, Residential Rental Property. 

What Qualifies?

Owning a piece of property does not automatically qualify you to deduct it’s depreciation value. To deduct the depreciation of a rental property, the IRS requires that you also meet the following criteria:

  • The property produces income (in other words, you rent it out).
  • The property has a “useful life”, meaning it will eventually wear out, get used up, etc. (For example, a house has a useful life while an unused piece of land you own does not.)
  • The useful life of the property is longer than one year. Read the rest of this entry »

Tax Deductions for Landlords (Part 2)

Posted by Tax Advisor on March 20th, 2015
Last modified: March 20, 2015

More landlord tax deductions

As a landlord, you know first hand how fast the “little things” really add up.

Filling up the gas tank after traveling to pick up rent checks, fixing a broken window, and replacing a lock  are just a few examples of expenses that total up over time.

The good news it that each of the expenses just mentioned is in fact tax deductible. Yes, even your vehicle mileage.

In part 1 of this article, we explained that the services you paid for could be included as deductible rental expenses. There are other landlord tax deductions you’ll want to include on your tax return.

What other rental expenses can I include as a deduction?

If you earned rental income, as we mentioned, you can deduct the expenses that you paid in relation to:

Tax Deductions for Landlords (Part 1)

Posted by Tax Advisor on March 20th, 2015
Last modified: March 20, 2015

There are quite a few, often-overlooked expenses that landlords can report as a tax deduction.

If you own rental real estate, you must report the income you earned from this property on your federal tax return. You will also be required to pay tax on your rental income if you made a profit.

First, keep in mind that aside from the monthly payments you receive from your tenants, taxable rental income also includes:

  • advance rent payments
  • security deposits used as a final payment of rent
  • payments for canceling of a lease
  • property or services received in place of money, as rent

So, what’s considered a “rental expense”?

On the plus side, rental properties offer more tax benefits than most investments. In fact, you can deduct a majority of the rental expenses you had during the year. According to the IRS, you can report expenses related to the following:

  1. upkeep & maintenance of the property
  2. conservation & management of the property

Landlord tax deductions also include contract work!

Remember when you forked over thousands to a plumber after your tenant called complaining that the toilet wasn’t flushing?  How about that week the roof collapsed from snowfall and you were forced to track down a roofer?

These (often unexpected) headaches come along with life as a landlord. Fortunately, they are related to the upkeep and maintenance of the property and thus, tax deductible expenses. Read the rest of this entry »

California Income Tax Rates

Posted by Tax Advisor on March 19th, 2015
Last modified: March 19, 2015

California residents pay the highest income tax rates in the country…

California is a paradise to its 38 million residents. Wines in Napa, celebs in L.A., Disneyland in Anaheim, the zoo in San Diego, well, there’s a lot to see and do.

However, living in the golden state comes with a hefty price tag. California levies the highest tax rates in the country. If you’re a new CA resident, you’re bound to notice it most when you file your state return.

Just how pricey is it?

Here are the 2014 California income tax rates for single filers:

California 2014 Tax Rates.jpg

If you’re Married Filing Jointly or Head of Household, just double the income brackets listed above. Read the rest of this entry »

RapidTax Prices Change for the Better!

Posted by Tax Advisor on March 18th, 2015
Last modified: March 19, 2015

We’ve lowered our prices!

Signed up but haven’t filed your 2014 tax return yet? You’ll be happy to hear that we’ve lowered our prices! 

And you still get expert tax help by phone or chat!

Retirees Now File Free!

Are you retired, aged 59 1/2 – that means you were born on or before September 16, 1955 – and received income from a retirement plan or social security? Your federal tax return is now free with RapidTax!

Not a retiree? Visit our pricing page to see who else qualifies for a free return.

File a State Return for $9.95!

The cost to file a state tax return with your federal return is now $9.95. That’s a savings of 50%!

Claiming Dependents? Deluxe drops to $24.95!

If you’re claiming a dependent(s) on your federal tax return, you’ll need our Deluxe Package. The great news is that the Deluxe Package price has decreased to $24.95!

You will also need the Deluxe Package if you’re reporting any of the following items:

  • any above the line deductions
  • alimony income
  • early distributions from retirement plans
  • Premium Tax Credit

Reporting Business Income? E-File for $34.95!

If you earned business or self-employment income in 2014, you’ll also save this tax season! Premier Package customers can now file a federal return for $34.95.

Premier include those reporting any of the following items, along with unlimited professional tax advice:

  • business or self-employment income
  • rental  income
  • royalties
  • capital gains or losses

Read the rest of this entry »

What You Need to Know About Claiming Your Dependent Relative

Posted by Tax Advisor on February 26th, 2015
Last modified: March 19, 2015

Taking care of an aging parent or relative can be hard, not to mention expensive. The good news is that you may be able to claim them on your tax return and get a bigger refund.

Supporting a relative can impact many areas of your life.  The most obvious are the changes to your living situation, amount of free time you have, and your finances.

To help relieve the financial strain of caring for a relative, you can report these relatives as dependents on your tax return. Doing so can save you thousands of dollars in taxes, because for every qualified dependent you claim your taxable income is reduced by $3,950.

Your dependent will belong to either one of the two following categories:

  • qualifying child 
  • qualifying relative

To learn more about claiming a qualifying child, refer to this RapidTax post.

Who Can I Claim as a Qualifying Relative Dependent?

The term “relative” may be unclear. For example, is your cousin’s wife considered your relative? How about his ex-wife? Read the rest of this entry »

What You Need to Know About Claiming Your Dependent Child

Posted by Tax Advisor on February 25th, 2015
Last modified: February 25, 2015

Here’s what you should know about claiming a dependent child on your taxes…

When filing your taxes, you’ll want to report the expenses that come along with the responsibilities of raising a child.

One way to do this is by claiming your child as a dependent. Each dependent you claim on your tax return will lower your total taxable income by one exemption. That means you’ll end up receiving a larger tax refund!

Keep in mind however, each dependent can only be claimed by one tax filer. Additionally, the dependent you’re claiming must qualify as either of the following:

  1. a qualifying child
  2. a qualifying relative

Who is considered a Qualifying Child Dependent?

In order to claim someone as your qualifying child, he or she must meet the following criteria:

  • Be your biological or adopted child, stepchild, foster child, sibling, half sibling, stepsibling, or a descendant of one of these
  • Be under the age of 19 or,  if he or she is a full-time student, under age 24 (There is no age limit if the child is permanently disabled.)
  • Be a U.S. citizen or U.S. resident, or a resident of Canada or Mexico
  • Be unmarried, or married but not filing a joint return
  • Have lived with you for at least half the year, unless absent due to illness, education, business, vacation, or military service
  • Have not provided more than half of his or her own support Read the rest of this entry »

The 2014 Tax Tables

Posted by Tax Advisor on February 24th, 2015
Last modified: February 24, 2015

Find your 2014 Tax Rate with the 2014 Tax Tables!

Have you filed your 2014 Tax Return yet?

If you’ve already filed, congratulations! If not, you may be wondering what the 2014 tax rates are.

Here at RapidTax, we’ve designed  the 2014 tax tables just for you. In fact, you can save these tax tables to your computer and refer back to the tax rates as needed.

Keep in mind that these tax tables are based on your filing status and total income earned throughout the year. You’ll need to know each in order to find your 2014 tax rate.

Read the rest of this entry »

How To Report Insurance If Covered Under Parent’s Plan

Posted by Tax Advisor on February 4th, 2015
Last modified: February 24, 2015

If you’re covered under your parent’s health insurance plan, you won’t face tax penalties when filing your 2014 Taxes 

If you’re in your early twenties and recently entered the “real world”, you know first hand how overwhelming it can be.

Not only do you feel the pressure to succeed in your first job, but you’ve also been slammed with bills you’ve never seen before. From paying student loans to coughing up rent and everything in between, you’ve got a lot on your plate.

Thanks to the Affordable Care Act aka Obamacare, paying for health insurance isn’t yet on your list of concerns. Keep in mind however,  you’ll need to report your insurance coverage on your 2014 Tax Return. RapidTax is here to help!

Who is Eligible for Coverage under Parent’s Plan?

You may be unsure if you qualify to be covered under your parent’s health insurance plan. Here’s what you should know:

  • you can stay on your parent’s health insurance policy until you turn 26 years old
  • if you don’t have insurance, you’ll have to pay a fee for being uninsured when filing your taxes Read the rest of this entry »