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Tax Disasters
same the following year. If their income increases, they may
have to pay back the whole subsidy. Once your income
exceeds four times the poverty limit, you get no credit at all.
This is based on your adjusted gross income (AGI). What if
your income tops that number by a small amount? Well, you
could put money into an IRA and push your adjusted gross
income below the threshold. You have until April 15th to do
that. Miss the deadline and you blew it. It could be that you
needed to put just one dollar into the IRA, which could have
saved you over $3,000, possibly much more. Oh well.
Rule #4: Every return benefiting from an Obamacare
health insurance tax credit should be analyzed to determine
the benefit of depositing money into an IRA for the purpose
of pushing the AGI down. Then make sure to make the
deposit before April 15.
Marriage
Very often, filing as married will save more than filing as sin-
gle. Imagine that a girl is working and making $80,000 a year.
She is getting married to a young man who is a student on
New Years day, 2017. For 2016, she must file as single,
because she was not married on the last day of the year! They
could have run down to a government office and gotten legal-
ly married on December 31. Would she have saved? Yep –
possibly over $8,000! Truly amazing.
Rule #5: Marriage makes a big difference on your taxes.
Contemplating marriage? Better run the numbers.
College Costs and Daycare CHANA
College expenses offer big tax credits, but there are rules
regarding amounts and number of years. If you do not time Offers a Jewish community response
your payments correctly, you can lose $2,500. Furthermore, to persons who experience abuse and
even for those who are on 100% scholarship can benefit. other forms of interpersonal trauma.
Although they cannot claim tuition, because they do not pay
any, they can claim supplies. That means they could spend • Community Awareness Programs
$2,000 on a very nice laptop and other supplies and have the • Legal Advocacy
government pay for it completely. The catch is that you must • Educational Workshops for all ages
pay for these supplies before the end of the tax year to claim • Trauma Therapy
the credit. • Supportive Counseling
• Consultations for Institutions & Professionals
Daycare expenses have similar rules for timing, and pay-
ments that may be wasted if you are not watching your time For more information about our programs, visit
schedule. chanabaltimore.org or call 410-234-0030.
Rule #6: College and daycare expenses have to be timed
correctly.
Conclusion
It is unfortunate when I see those who fail to deal with taxes
proactively. As you can see, it is possible for a person to waste
serious amounts of money by falling asleep at the wheel. By
staying on top of things, you will hopefully be able to have a
smaller tax bill.◆
Eli Pollock, CPA, can be reached at elipollock2@yahoo.com.
u 410 358 8509 u 115
same the following year. If their income increases, they may
have to pay back the whole subsidy. Once your income
exceeds four times the poverty limit, you get no credit at all.
This is based on your adjusted gross income (AGI). What if
your income tops that number by a small amount? Well, you
could put money into an IRA and push your adjusted gross
income below the threshold. You have until April 15th to do
that. Miss the deadline and you blew it. It could be that you
needed to put just one dollar into the IRA, which could have
saved you over $3,000, possibly much more. Oh well.
Rule #4: Every return benefiting from an Obamacare
health insurance tax credit should be analyzed to determine
the benefit of depositing money into an IRA for the purpose
of pushing the AGI down. Then make sure to make the
deposit before April 15.
Marriage
Very often, filing as married will save more than filing as sin-
gle. Imagine that a girl is working and making $80,000 a year.
She is getting married to a young man who is a student on
New Years day, 2017. For 2016, she must file as single,
because she was not married on the last day of the year! They
could have run down to a government office and gotten legal-
ly married on December 31. Would she have saved? Yep –
possibly over $8,000! Truly amazing.
Rule #5: Marriage makes a big difference on your taxes.
Contemplating marriage? Better run the numbers.
College Costs and Daycare CHANA
College expenses offer big tax credits, but there are rules
regarding amounts and number of years. If you do not time Offers a Jewish community response
your payments correctly, you can lose $2,500. Furthermore, to persons who experience abuse and
even for those who are on 100% scholarship can benefit. other forms of interpersonal trauma.
Although they cannot claim tuition, because they do not pay
any, they can claim supplies. That means they could spend • Community Awareness Programs
$2,000 on a very nice laptop and other supplies and have the • Legal Advocacy
government pay for it completely. The catch is that you must • Educational Workshops for all ages
pay for these supplies before the end of the tax year to claim • Trauma Therapy
the credit. • Supportive Counseling
• Consultations for Institutions & Professionals
Daycare expenses have similar rules for timing, and pay-
ments that may be wasted if you are not watching your time For more information about our programs, visit
schedule. chanabaltimore.org or call 410-234-0030.
Rule #6: College and daycare expenses have to be timed
correctly.
Conclusion
It is unfortunate when I see those who fail to deal with taxes
proactively. As you can see, it is possible for a person to waste
serious amounts of money by falling asleep at the wheel. By
staying on top of things, you will hopefully be able to have a
smaller tax bill.◆
Eli Pollock, CPA, can be reached at elipollock2@yahoo.com.
u 410 358 8509 u 115
