Being a mother who works from home, I’ve learned that taking care of finances can make things run smoother both for my family and my business.
Since March is National Women’s History Month, I wanted to share some tax credits and deductions that working mothers will want to look into so they can minimize their family’s tax obligations and possibly boost their refund.
Maximize Your Family Tax Benefits
While most moms don’t think of tax benefits as part of the joys of parenting, there are some huge advantages to raising kids.
- Dependent Exemption: Reduce your taxable income by taking the dependent exemption. It’s worth $3,950 per qualifying child (if they 19 or younger or 24 or younger if attending college) when you file your taxes. Before submitting, double check that social security numbers are correct for your dependents.
- Child and Dependent Care Credit: If your child (under 13) was in day care last year, you may use this tax credit to claim up to $1,050 of child care related expenses (or up to $2,100 for two or more dependents).
- Earned Income Tax Credit: If your family meets the income requirement, the Earned Income Tax Credit can make a huge difference. It’s a refundable tax credit that can be worth thousands of dollars based on family size and filing status.
- Child Tax Credit: Not to be confused with the Child and Dependent Care Credit, this credit is worth $1,000 for each qualifying child (under 17).
- Adoption Credit: The federal government allows families to use a tax credit which is worth up to $13,190. Qualifying adoption expenses include attorney, traveling (if directly related to the adoption) and court fees.
Optimize Your Work Benefits
Juggling both your family and employment obligations can be hard, but fortunately there are some work related deductions that can improve your family’s finances.
- Travel Expenses: Did you attend any work conferences and events? Keep your receipts as you may be able to deduct related expenses.
- Home Office Expenses: If you’re self-employed, make sure you have documentation for your tax deductible business expenses for your home office, including equipment depreciation and supplies.
- Moving Expenses: If you moved in 2014 for a new job you may be able deduct some moving expenses like storage and travel.
Thoughts on Tax Perks for Working Moms
I hope these credits and deductions help you and your family this year. Did I miss anything with my list? Which ones do you qualify for? If you expect a refund, what are your plans for using it?