Tax Deductions and Credits How Changes in Your Life Can Save You Money Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by TurboTaxLisa Published Oct 23, 2023 3 min read Reduce your taxes with a personalized tax plan Our experts review your unique situation and recommend proven tax strategies to lower your tax bill. By selecting Learn More, you will be leaving Intuit’s site. Learn More Whether you got married last year or purchased your first home, changes experienced in your life can bring about many questions and uncertainties. Although you may have questions about how life events affect your finances, one thing is certain:, what might seem crazy, ever-changing life can save you money on your taxes. Did you get married last year? Purchase your dream home? Have a baby? Or have another life change? Check out just a sample of significant life events that could save you money at tax time and how we can help you. Table of Contents Getting marriedBuying a new homeHaving a baby Getting married Did you get married this year, or are you considering it? We know weddings cost a bundle and can really set you back, but one perk of getting married is that you can now see some bigger tax benefits than when you were single. Now that you’ve tied the knot, you and your loved one can now file your taxes as married filing jointly and may see lower tax liability than when you were single. This is because there are lower federal tax rates for couples who file married filing jointly compared to filing as single. Most married couples will see tax savings or a “marriage bonus.” You may also see bigger tax deductions and credits now that you can file as married filing jointly. For example, there’s a bigger standard deduction for tax year 2023. The standard deduction increased to $13,850 if you are filing as single and $27,700 married filing jointly. Also, for 2023, the Earned Income Tax Credit is up to $7,430 with three kids if you are married filing jointly. Even if you were married on December 31 of last year, you are considered married all year and can reap the rewards of being married. Buying a new home Homeownership is a big and rewarding life change that is also one of the biggest tax savings people see. Your mortgage and property taxes can really break the bank, but if you purchased a home this year or you are considering it, you can deduct your home mortgage interest and property taxes. Having a baby Did you have a baby last year? If so, congratulations on your new addition to the family! Combined with all the joy and excitement a child brings, you may be trying to figure out how you’re going to pay the costs of supporting your baby. Well, fortunately, your family is now eligible for new tax deductions and credits as well. Some of the tax benefits you will receive for having a baby are the Child Tax Credit and Child and Dependent Care Credit. For tax year 2023 (the taxes you file in 2024), the provisions are: Child Tax Credit: Up to $2,000 for 2022 – 2025 Each dependent child must be under 17 Refundable up to $1,600 The credit is available if you earn up to $200,000 as a single filer and up to $400,000 if you are married filing jointly. Child and Dependent Care Credit: Up to 35% of $3,000 ($1,050) of child care expenses for a dependent child under 13, an incapacitated spouse or parent, or another dependent so that you can work or look for work. If you have two or more dependents, the credit will be up to 35% of $6,000 in expenses ($2,100). The credit will be reduced at incomes over $15,000. You can see why your new baby can be considered your biggest little tax deduction. Life transitions may feel like many things at once: exciting, emotional, confusing, hopeful, and often expensive. On the bright side, these life moments often bring big tax benefits. Don’t worry about knowing these tax rules. Meet with a TurboTax Full Service expert who can prepare, sign and file your taxes, so you can be 100% confident your taxes are done right. Start TurboTax Live Full Service today, in English or Spanish, and get your taxes done and off your mind. Get started now Previous Post 12 Ways to Save on Taxes Through Life’s Transitions Next Post Is This Deductible? Adopting a Pet Written by Lisa Greene-Lewis Lisa has over 20 years of experience in tax preparation. Her success is attributed to being able to interpret tax laws and help clients better understand them. She has held positions as a public auditor, controller, and operations manager. Lisa has appeared on the Steve Harvey Show, the Ellen Show, and major news broadcast to break down tax laws and help taxpayers understand what tax laws mean to them. For Lisa, getting timely and accurate information out to taxpayers to help them keep more of their money is paramount. More from Lisa Greene-Lewis Follow Lisa Greene-Lewis on Twitter. 8 responses to “How Changes in Your Life Can Save You Money” My daughter is 18 and attends ccbc college can I claim her as a dependent How would I file married filing jointly if my spouse is not a us citizen yet? My spouse also doesn’t work. 66 yrs old divorced with a 14 yr old making 64,000. Do deaths/ funeral expenses fall under any tax deductions? How can I add an elderly parent who now lives with me. How is deductible a new car? My wife and I married on March of 2017. She is from Africa. I supported her the entire year but had no SSN for her. Obtaining an ITIN was not in the works because the paperwork filed for her Visa also included a SSA application for a SSN. I filed single because I didn’t have her SSN. Now that she is here and has a SSN am I able to file an amendment? My wife is currently self employed and I am retired and we pay estimated taxes each year. However, she is going to retire at the end of December. How do we get Turbo Tax to recognize that change in our taxable income for next year and reduce our estimated taxes. Browse Related Articles Tax Reform Tax Reform 101: Will Getting Married Change My Tax Situ… Tax News DOMA Struck Down: What Does This Mean for Your Taxes? Tax News Same-Sex Couples Can File 2012 Tax Returns as Single Be… TurboTax News Had a Life Change? TurboTax CPAs and EAs Will be by You… Tax News IRS Announcement: Same-Sex Couples Recognized as Marri… Family Love and Taxes: Tax Benefits of Marriage Tax Planning Married or Divorced? 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How would I file married filing jointly if my spouse is not a us citizen yet? My spouse also doesn’t work.
My wife and I married on March of 2017. She is from Africa. I supported her the entire year but had no SSN for her. Obtaining an ITIN was not in the works because the paperwork filed for her Visa also included a SSA application for a SSN. I filed single because I didn’t have her SSN. Now that she is here and has a SSN am I able to file an amendment?
My wife is currently self employed and I am retired and we pay estimated taxes each year. However, she is going to retire at the end of December. How do we get Turbo Tax to recognize that change in our taxable income for next year and reduce our estimated taxes.