WASHINGTON — The Internal Revenue Service has updated the tax year 2018 annual inflation adjustments to reflect changes from the Tax Cuts and Jobs Act (TCJA). The tax year 2018 adjustments are generally used on tax returns filed in 2019.

The tax items affected by TCJA for tax year 2018 of greatest interest to most taxpayers include the following dollar amounts: Read More

Can a simple educational letter to taxpayers who appear to have erroneously claimed the earned income tax credit (EITC) actually avert future noncompliance? Based on recent TAS research studies, the answer appears to be yes.

As readers of this blog already know, the EITC is a refundable credit designed to provide financial support to low income working taxpayers, especially those with children in the household. Because it focuses on household composition, the administration of the credit is very complex. While the IRS can generally establish the age of the child from various government databases, and sometimes the parent-child relationship, it cannot easily establish other relationships nor can it independently determine with whom the child lived for over half the year, as the law requires. Read More

The IRS reminds members of the military and veterans that they may qualify for the earned income tax credit. This credit benefits certain people who work and have earned income that’s less than $53,930.

A tax credit usually means more money in the taxpayer’s pocket. The EITC can reduce the amount of tax someone owes, but it might also result in a refund. Here are some things members of the armed forces should know about this credit. These are all specific to the military: Read More

What is the Pennsylvania EITC Program?

The Educational Improvement Tax Credit program allows business donors and accredited individual donors to redirect their annual business and individual income tax liabilities to local schools and charities that help kids from ages 3 to 18.

What tax benefit does a donor receive? Read More

Debra Thompson

Millions of Americans forgo critical tax relief each year by failing to claim the Earned Income Tax Credit (EITC), a federal tax credit for individuals who work but do not earn high incomes. Taxpayers who qualify and claim the credit could pay less federal tax, pay no tax or even get a tax refund. Read More