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Frequently Asked Questions

Is there an age limit on claiming my child as a dependent?

To claim your child as a dependent, your child must meet either the qualifying child test or qualifying relative test:

  • To meet the qualifying child test, your child must be younger than you and either younger than 19 years old or be a "student" younger than 24 years old as of the end of the tax year.

  • There's no age limit if your child is "permanently and totally disabled".

How do I know if I should file quarterly estimated tax payments?

Generally, you must make estimated tax payments for the current tax year if both of the following apply:

  • You expect to owe at least $1,000 in tax for the current tax year after subtracting your withholding and refundable credits.

  • You expect your withholding and refundable credits to be less than the smaller of:

    • 90% of the tax to be shown on your current year’s tax return, or

    • 100% of the tax shown on your prior year’s tax return. (Your prior year tax return must cover all 12 months.)

Can I receive a tax refund if I am currently making payments on an installment agreement for another federal tax period?

No, one of the conditions of your installment agreement is that the IRS will automatically apply any refund (or overpayment) due to you against taxes you owe. Because your refund isn't applied toward your regular monthly payment, continue making your installment agreement payments as scheduled.

If your refund exceeds your total balance due on all outstanding tax liabilities including accruals, you'll receive a refund of the excess unless you owe certain other past-due amounts, such as  state income tax, child support, a student loan, or other federal nontax obligations which are offset against any refund.

What is the Earned Income Tax Credit?

The EITC is a refundable tax credit given to taxpayers that earn low to moderate income from a job or from being self-employed. While it may eliminate the taxes you owe, you may also receive a tax refund for the amount of your credit if the credit is more than the amount of taxes you owe.

You may be eligible for the EITC if you meet the income limits included below and all of the following apply:

  • You are a U.S. citizen

  • You are over the age of 25 or have qualifying children

  • You do not file “married filing separately”

  • You have earned income from employment. Unemployment income doesn’t count.

  • You can qualify if you have income from a home business or provide services

While you can have interest, dividends and other investment earnings, your investment income must be less than $3,650 in 2020. But most importantly, you have to file your federal taxes in order to claim this valuable credit.

The limits are adjusted each year, and for tax year 2020, your earned income and adjusted gross income must be less than:

  • $50,594 ($56,844 married filing jointly) with three or more qualifying children

  • $47,440 ($53,330 married filing jointly) with two qualifying children

  • $41,756 ($47,646 married filing jointly) with one qualifying child

  • $15,820 ($21,710 married filing jointly) with no qualifying children

Are Unemployment Benefits Taxable?

Typically, unemployment income is taxable and should be included in your income for the year. Some states may also count unemployment benefits as taxable income. When it’s time to file your taxes, you will receive Form 1099-G which will show the amount of unemployment income you received. Form 1099-G will also show any federal taxes you had withheld from your unemployment pay.

I have miscellaneous itemized deductions that don't seem to help anymore, why is that?

After TCJA reform, there were many changes to itemized deductions that can be claimed on Schedule A.  

Previously, when a taxpayer itemized, they could deduct the amount of their miscellaneous itemized deductions that exceeded 2 percent of their adjusted gross income. These expenses are no longer deductible.

This includes unreimbursed employee expenses such as uniforms, union dues and the deduction for business-related meals, entertainment and travel. It also includes deductions for tax preparation fees and investment expenses, such as investment management fees, safe deposit box fees and investment expenses from pass-through entities.

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