Frequently Asked Questions
Answers to Frequently Asked Questions
What are the biggest changes tax changes for individuals in 2018?
Answer: While there were many changes created by Tax Cuts and Jobs Act, the most impactful ones for individuals were the elimination of Personal Exemption, the decrease in tax brackets, the increase in the Child Tax Credit from $1,000 to $2,000 and an increase in income threshold to qualify for the credit, and the increase in the Standard Deduction. For a majority of individuals, the standard deduction will be taken instead of itemizing.
How much money can I contribute to a ROTH IRA or a Traditional IRA for 2019?
Answer: Qualifying participants can contribute up to $6,000 into a ROTH or Traditional for 2019. There is also a catch-up contribution that can be made of $1,000 if participants are over age 50. These contributions can be made up until April 15, 2020, for 2019 also. It’s important to note that there are income thresholds for participants.
Is there an age limit to claiming a child as a dependent?
Answer: To claim your child as your dependent, your child must meet either the qualifying child test or the 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 calendar year.
- There’s no age limit if your child is “permanently and totally disabled” or meets the qualifying relative test.In addition to meeting one of the tests above, your child must also meet all of the other tests to be your dependent (Dependent taxpayer test, citizen or resident test, and the joint return test).
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