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Kira Botkin
Kira is a longtime blogger and serial entrepreneur who enjoys gardening, garage sales, and finding stray animals. She lives in Columbus, Ohio, where football is a distinct season, and by day runs a research study for people with multiple sclerosis. She hopes that the MoneyCrashers team can help you achieve your goals and live a great life.

Filing Taxes for Kids: Does My Child Have to File a Tax Return?

By Kira Botkin

business kid taxesIf your kids discovered the joys of capitalism this year, raking in the dough from paper routes or pizza delivery, or receiving stocks or bonds instead of toys for their birthdays, they may also get to experience the joy of taxes this April. You may be surprised to find that, as dependents, your children have different rules for when to file taxes, and on what income, than you do.

When you pay your own taxes, you’re entitled to a personal exemption of $3,900 for tax year 2013. Therefore, the first $3,900 of your income isn’t taxed. When you claim your child as a dependent, you get to deduct their personal exemption on your taxes, which means your child doesn’t get to use it on theirs.

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How to File for an IRS Tax Extension Electronically or With Form 4868

By Kira Botkin

tax season lateMy best friend is chronically late for everything: dinner, work, parties, you name it. Unfortunately, this behavior can have dire consequences when tax season rolls around. Several years ago she was in a panic because it was April 14th, just before the tax filing deadline, and she had yet to file her taxes. She rushed through the paperwork and drove to the post office to drop them off in the mail slot at 11:58pm.

What she didn’t know is that the IRS allows you to apply for a six-month extension on filing your tax return. So, if you don’t have it all together by tax day in April, don’t panic. You can extend all the way to October.

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Tax Implications of Retirement Accounts – IRA & 401k Distributions & Withdrawals

By Kira Botkin

seniors retirement moneyWhen your retirement accounts are growing, it’s great to see the numbers climb. But when you retire and start taking money out of your IRA and 401k, the taxes you owe can take a surprisingly big chunk out of your total. Hopefully you’re taking advantage of the tax breaks that come with contributing to most retirement accounts, but are you ready for the taxes and penalties that you’ll deal with when you retire?

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Ultimate Guide to IRS Schedule C Tax Deductions & Expenses For Small Business Owners

By Kira Botkin

stack of receiptsIf you run a small business, perform freelance work, or have other side income, you probably know exactly what you earn – but you may not be keeping a close eye on what you’re spending. And properly tracking the money you spend to run your business is incredibly important come tax time, especially if you’re to get the most out of your tax returns.

Take a look at the following guide to Schedule C deductions, and you may find that you’re missing out on some key tax deductions for self-employed freelancers and small business owners.

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Standard Deduction vs. Itemized Tax Deduction – What’s Better?

By Kira Botkin

writing calculator taxesOne of the biggest breaks the IRS provides is in the form of deductions, which allow you to reduce your taxable income and thereby pay less in taxes. You may be accustomed to taking the standard deduction, which is a preset amount. Or, you may choose to itemize deductions on Schedule A. The choice is up to you.

For most taxpayers, the amount of the standard deduction and the itemized deduction are different. Typically, your tax preparation software or accountant determines which will give you the lowest tax bill. However, understanding the difference yourself, particularly what types of expenses you can deduct on Schedule A, can help you maximize those deductions and make better choices throughout the year to reduce your taxes.

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Deducting Health Insurance Premiums & Healthcare Expenses on Your Taxes

By Kira Botkin

doctor healthcare costsThe cost of healthcare has been growing much faster than inflation, and will likely continue that trajectory considering the changes implemented by the Patient Protection and Affordable Care Act. This unfortunate trend may leave you wondering if you have any recourse to save money and reduce the impact of costly healthcare at all.

Plus, if you are not currently covered by health insurance, you may be required to purchase it with the implementation of the individual health insurance mandate in 2014. Though some income groups will receive assistance to afford coverage, many won’t and will face a fine for not purchasing adequate coverage.

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4 Education-Related Tax Deductions and Credits for College Tuition & Expenses

By Kira Botkin

college grad moneyUnless you were born with a silver spoon in your mouth or the ability to perform a jump shot on par with LeBron James, your or your children’s college education is going to cost you. Public colleges cost an average of $22,261 per year, and private universities boast a massive average tuition price of $43,289. And according to the U.S. Department of Education, college seniors now graduate with an average of $28,186 in student loan debt.

Despite the fact that you cannot fully escape high tuition costs, there are ways to alleviate some of the financial burden. The Federal Government currently offers four tax credits and deductions that can save you bundles of cash at tax time.

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Tax Form 8949 – Instructions for Reporting Capital Gains & Losses

By Kira Botkin

In an effort to help make filing taxes easier this year, we are breaking down the various IRS tax forms to help you know if you need them, and how to use them.

cash pen capital gainsIf you have capital gains or losses to report on your taxes, you’ll want to be aware of a recent process change. Instead of totaling up your transactions on Schedule D, the IRS requires you to list them out on Form 8949.

It’s a bit complicated to get started, but once you’re organized, you’ll be able to fill out the Form 8949 and Schedule D very quickly.

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How to Calculate Federal Income Tax – Rates Table & Tax Brackets

By Kira Botkin

income tax bracketsThe United States income tax laws are based on a progressive tax system. Basically, this setup means that you pay a percentage of your income, owing more taxes when you make more money, and contributing fewer tax dollars when you make less money.

Theoretically, a progressive system distributes the tax burden more heavily onto those who make more money and thus have more ability to pay, and away from those who can’t afford as much.

Over time, tax deductions, credits, exemptions, and loopholes have modified and complicated our system. But at heart the American income tax system uses a relatively simple series of stepped tax rates to determine how much you owe.

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What Is the Earned Income Tax Credit (EITC) – Requirements & Eligibility

By Kira Botkin

white piggy bankTaxes are a burden for everyone, but especially for low-income individuals and families who need to hang onto as much money as possible.

Interestingly, low-income earners pay a much larger percentage of their salary to Social Security than high earners do, which makes their tax bite effectively larger. In an effort to help offset this effect and to encourage people to work, Congress created the earned income tax credit (EITC) in 1975.

The program is still going strong today and provides tax relief and extra income to low and moderate earners, especially to those with children.

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Investment Expense Tax Deduction – Which Fees Can You Deduct?

By Kira Botkin

chart coinsIf you have investments, such as stocks or mutual funds, you might be missing out on a commonly overlooked tax deduction. When you itemize, you can add investment fees and expenses to your miscellaneous deductions down at the bottom of Schedule A (line 23).

You can only deduct miscellaneous expenses that are in excess of 2% of your adjusted gross income (AGI), but there are several other items that get lumped in with that, such as unreimbursed employee expenses, tax preparation fees, educator expenses, losses from casualties or thefts, hobby expenses, and certain legal fees.

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Important Tax Tips for Gay & Lesbian Partners and Unmarried Couples

By Kira Botkin

gay coupleGay marriage, though legal in a number of states, is not recognized by the Federal Government. This means, among a whole host of other issues, that same-sex couples do not enjoy the same tax breaks as married heterosexual partners in the United States.

As frustrating as that may be, the good news is there are still ways you can lower your tax bill come the tax filing deadline. And this advice isn’t great just for same-sex partners – any unmarried,  financially interdependent couple can benefit from the following tips.

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What Is the Gift Tax – IRS Rules, Rate & Maximum Exclusion Limit

By Kira Botkin

gift tax moneyAre you considering transferring wealth, assets, or property to your heirs? You may be in for a much more difficult – and costly – procedure than you realize. While giving to those you love is wonderful, you must be aware that giving isn’t free.

If you’re in a position to help out younger family members or friends, or if you’re contemplating how to best transfer your estate to your heirs, it is crucial to understand gift tax regulations. Some gifts aren’t subject to any tax, but many are. A quick study of the numbers and rules can prevent you from taking an unnecessarily large tax hit and help you plan how to transfer your wealth. In addition to familiarizing yourself with gifting rules, contact an estate planner or attorney to make sure your heirs receive everything they’re entitled to.

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Claiming Qualifying Dependents on Taxes – IRS Tax Dependent Definition & Rules

By Kira Botkin

family children tax dependentsAs any parent knows, dependents are a great way to get tax deductions. Everyone in the U.S. is eligible to receive a “personal exemption” of $3,900 on their taxes. However, if they don’t support themselves (such as children), their personal exemption can be transferred to the person who does support them (such as their parents), by claiming them as dependents.

If you have people in your household that you support, each one may be considered a dependent and can reduce your taxable income by $3,900. However, there are specific rules that must be met in order for this to occur.

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4 Tax Deductions for Self-Employed Freelancers and Small Business Owners

By Kira Botkin

cash calculators deductionsWhen you start your own business, it can seem like there’s always something else to spend money on to keep things running smoothly. Fortunately, most of these expenses are tax-deductible. The IRS defines a deductible expense as something that is ordinary and necessary – in other words, it must be something you need to run your business, and that is commonly used by others in your line of work. For example, a mobile dog groomer could reasonably write off a new washtub. However, it might raise some eyebrows if a graphic designer put a bathtub on the company credit card.

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