Life Events


Back

Family Matters

Birth of Child / Adoption

Birth of child

The addition of a child to your family whether you had a new baby or adopted a child may entitle you to several tax benefits. For a child born or adopted (the adoption must be final) during the year you will be able to claim the child as a dependent on your tax return and receive an exemption for the dependent. The exemption amount for 2014 is $3,950 for each dependent income other tax benefits you maybe be entitled to are:

  • Credit for Child and Dependent Care Expense
  • Child Tax Credit
  • Earned Income Tax Credit

For more information see Publication 503, 596 and 972 at www.irs.gov.


Child Attended Day Care

If you are a working parent, or you were working and are now looking for work, you may be able to claim a credit for your child care expenses. Your dependent (under the rules for qualifying child) must have been under age 13 when care was provided. The credit may be as much as $1,050 for the expenses for one qualifying child or $2,100 for more than one child, depending on your adjusted gross income.


Adopted a Child

If you pay for adoption expenses, you may be able to take a credit for qualified adoption expenses of up to $13,190 per child. If your modified adjusted gross income is over $197,880 the credit begins to be phased out. If your modified adjusted gross income is $237,880 or more, you cannot take this credit.