(Photo: Forbes)
Getting preoccupied with having your first child is not an excuse not to do your taxes.
While tax season has recently begun, it is always better to remain informed to avoid cramming the deadline.
READ ALSO: Major Tax Credits Americans Can Claim This Year, Check This Out
Here’s what else new parents should know about taxes this year:
(Photo: NerdWallet)
Apply for a Social Security card for your child
Ensure your child has a Social Security number. If they don’t have an SSN, you can’t declare your child as a dependent on your tax return, John Karls.
Head of a Household Status
If you’re a single parent, you’ll be able to claim a $19,400 deduction versus a $12,950 deduction for single applicants without dependents.
Tax Credit for Adoption
If you adopted a child in 2022, you could be credited up to $14,890 for adoption-related expenses incurred per child. To claim the full credit, your gross income must be below $223,410. However, the difference is nonrefundable.
What is the amount of the Child Tax Credit this year? What are the requirements?
IN 2022, to qualify for the Child Tax Credit, you need to have an adjusted gross income of less than $200,000 or less than 400,000 if you’re filing a combined return with a partner.
Income Limit for Child and Dependent Care Credit
If you are employed and paid for childcare services, you could get a tax credit for up to $3,000 if your total gross income is $43,000 or less.
You may receive tax documentation from your child’s care service. Otherwise, collate your documents as proof of payment.
EITC Qualifications
Having a child may qualify you for the Earned Income Tax Credit. If you have one child and your adjusted gross income is $43,492 if you file a return alone or $49,622 if you file a joint return with a spouse, you may be eligible for a refundable tax credit of up to $3,733.
Make changes to your W-4 Withholding
Finally, fill out a new W-4 form for your employer to reflect that you now have a dependent. This will likely reduce your refund next year, but it will increase the size of your paychecks.
READ ALSO: IRS: 2023 Tax Filing Season Official Start Date Set To January 23
