Tax preparation Oxnard California Archives

What You Need to Know About Education Tax Credits

January 19, 2022

If you or someone included on your tax return are pursuing higher education, we encourage you to consider two little-known tax credits: the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC), two tax breaks that can reduce the amount of tax you owe.

Education Tax Credits: What You Need to Know

The purpose of the AOTC and the LLC is to help with the cost of higher education by lowering the amount of tax you owe.

Regardless of the differences between these credits (we’ll touch on that later), three conditions must be met in order to qualify for any of them:

You, your dependent, or a third party pays qualified education expenses for higher education.
An eligible student must be enrolled at an eligible educational institution.
The eligible student is yourself, your spouse, or a dependent you list on your tax return.

On the other hand, you CANNOT claim these credits if someone else (such as your parents) lists you on their tax return; if your filing status is married filing separately; if you already claimed or deducted another higher education benefit using the same student or same expenses; or if you or your spouse were a non-resident alien for any part of the year and did not choose to be treated as a resident alien for tax purposes.

Differences Between AOTC and LLC

One of the most relevant differences between these two credits is that the AOTC, applies only when the student hasn’t completed four years of post-secondary education before 2021. Plus, the student must be pursuing a degree or other recognized education credential and must have no felony drug convictions as of the end of 2021.

By contrast, it’s possible to qualify for the LLC with all years of post-secondary education and for courses to acquire or improve job skills. Additionally, the student does not need to be pursuing a degree or other recognized education credential. Finally, the requirement of no felony drug convictions does not apply in this case.

Another important difference is that the AOTC is a partially refundable tax credit (40%), while the LLC is not refundable. This distinction is worth keeping in mind because not refundable tax credits cannot be used to increase your tax refund or to create a tax refund when you don’t have one.

If you are interested in learning more about education tax credits, contact us today. We’ll be glad to help you make sense of these tax breaks and determine if you qualify for any of them.

Need Help With Your Taxes? Contact the Experts at JT Tax Services

Do you need assistance with personal or business taxes? JT Tax Services is here to help! We give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone (805-984-8890), or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services.

Everything You Need to Know About the Third Stimulus Payment

By: UNIKO Media Group

March 17, 2021

The third stimulus payment is already being delivered to taxpayers all over the United States. That’s why today we bring you everything you need to know about your stimulus payment, from how to check the status of your payment to how much you would receive

What Do I Have to Do to Get My Payment?

The third round of Economic Impact Payments is delivered automatically, which means that in most cases you don’t have to take any action to get your payment. A lot of people will receive the third payment in the same way they received the previous two.

How Can I Check the Status of My Payment?

Knowing when and how the IRS will send your payment is quite easy thanks to the internet. All you have to do is access the online tool Get my Payment and enter all the necessary information. The IRS asks taxpayers not to call if they need to check the status of their payments. Use the online tool instead and keep in mind that it’s updated once a day, usually overnight, so there’s no need to check more than once a day.

How Much Will I Get?

Most people will receive $1,400 plus $1,400 for every qualifying dependent that they claim on their tax return.

Remember that the eligible income levels have changed for the third round of payments. This means that some people who qualified for the first and second payments won’t be eligible for the third one. Payments will begin to be reduced for people who earn $75,000 or more in Adjusted Gross Income (or $150,000 for married couples filing jointly).

At What Level of Income Do the Payments Stop?

Reduced payments stop at $80,000 Adjusted Gross Income for individuals ($160,000 for married couples). Taxpayers with income above those levels are not eligible for the third Economic Impact Payment.

Contact the Experts at JT Tax Services

Do you need help filing your 2020 tax return? Do you want to learn more about Economic Impact Payments? At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

You May Receive Your Second Stimulus Payment by Credit Card

Some People Will Receive Their Second Stimulus Payment by Debit Card

By: UNIKO Media Group

January 20, 2021

Some people will receive their second stimulus payment by prepaid debit card. Read on to discover the aspects you should keep in mind.

In fact, this method was already used in some cases to deliver the first round of Economic Impact Payments, also known as stimulus payments.

Keep in mind that the form of payment may vary between your first and your second stimulus payment. If you received your first payment by paper check you could receive your second payment via prepaid debit card. Conversely, if you received your first payment by prepaid card, you may receive it now by paper check.

You can use the online tool Get My Payment to check whether your payment has been mailed.

The prepaid debit cards arrive in a while envelope that displays prominently the seal of the Department of the Treasury of the United States. The envelope displays the statement “Not a bill or an advertisement. Important information about your Economic Impact Payment.”

What You Can Do With Your Card

The name of the issuing bank, MetaBank, N.A., appears on the back on the card while the name Visa appears on the front. Your card will allow you to do the following without having to pay a fee:

Transfer funds to a personal bank account
Make signature or PIN-debit purchases anywhere Visa Debit
Cards are accepted — in stores, online or over the phone
Get cash back with a PIN debit purchase where available
Get cash from in-network ATMs
Get a replacement EIP Card, if needed
Check their card balance online, through a mobile app or by phone

More Tips About Taxes

Interested in learning more about taxes? Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

At JT Tax Services, we give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email (info@jttaxservices.com), telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to schedule a consultation or to learn more about our services.

This Christmas, Beware of Hacking Attempts

By: UNIKO Media Group

December 24, 2020

Christmas is the merriest season of the year, but it also offers ideal conditions for hacking attempts. Keep reading to learn why you should be especially careful these days, and what steps you can take to protect your data.

Why Are Hacking Attempts Common During the Holidays?

The holidays, and in particular the days around Christmas, have become a hunting ground for hackers looking to steal personal information. This phenomenon is caused by a combination of circumstances that favor cyber-criminals:

Many employees are on vacation, which means that many companies have to let their guard down.
People are more willing to open unsolicited emails, especially if they promise holiday deals/discounts.
The holiday season offers myriad opportunities to trick unsuspecting victims through email: virtual greeting cards, invitations, and other holiday-related content.

How to Protect Yourself

In order for most hacking attempts to succeed, you must be tricked into performing certain actions, such as clicking on a link or downloading a file. This means that being cautious when you use the internet is your best line of defense. Other steps you can take include:

Use safe passwords. Choose passwords of at least eight characters that include a mix of upper and lower case, special characters and numbers.
Use multi-factor authentication. When available, use this feature, where a website asks you for two pieces of information before granting access. This is not a silver bullet but makes hacking attacks less likely.
Be extremely careful with links and attachments. These are the resources that hackers use more often, so don’t click on a link or download an attachment unless you know the sender.
Backup your data. In itself, this doesn’t prevent hacking attacks, but it can make all the difference if you can’t access your data after a breach.

More Tips About Taxes

Learning more about taxes is always a smart move, as it helps you avoid fines and missed deductions. Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

Need help preparing your taxes? At JT Tax Services we have the experience, the knowledge, and the drive to assist you. We give you the peace of mind that comes with knowing that you are limiting your liability while staying compliant with all regulations.

We are located in Oxnard, California. Contact us today by email, telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to learn more about our services.

3 New Things to Consider When You File Your 2020 Tax Return

By: UNIKO Media Group

December 18, 2020

This year has been out of the ordinary from every point of view, including taxes. There are some new things you should consider when you file your 2020 tax return. Keep reading to learn more.

Recovery Rebate Credit

You may be able to claim this credit if you met the eligibility requirements for an Economic Impact Payment in 2020 and one of the following applies to you:

You didn’t receive an Economic Impact Payment in 2020.
You are single and your payment was less than $1,200.
You are married, filed jointly for 2018 or 2019 and your payment was less than $2,400.
You didn’t receive $500 for each qualifying child.

Refund Interest Payment

If you received a federal tax refund in 2020, keep in mind that interest payments are taxable and must be returned on your 2020 federal tax return. Next January, the IRS will send a form to any person who received interest payments of at least $10 during the last year.

New Charitable Deduction

If you don’t itemize your deductions, you can take this year a new charitable deduction of up to $300 for donations made during 2020 to qualifying institutions. If you are interested in this deduction, check out this previous post where we take a closer look at this interesting topic.

Finally, remember that you shouldn’t rely on receiving your refund by a certain date. This is particularly important if you are planning to make a big purchase or pay important bills. While the IRS processes tax returns as soon as possible, some returns require more time, so your refund may take longer than you expect.

More Tips About Taxes

Learning more about taxes is always a smart move, as it helps you avoid fines and missed deductions. Here are some previous posts you may find interesting.

Contact the Experts at JT Tax Services

We are located in Oxnard, California. Contact us today by email, telephone, or through our social media accounts on Facebook, Twitter, and LinkedIn to learn more about our services.