- NY Credits : 1.0
- TX Credits : 1.0
- IRS Enrolled Agent Credits : Federal Tax/Tax Related Matters - 1.0
- IRS Non-Credentialed Return Preparer Credits : Federal Tax - 1.0
Form 1040 - Tax Credits
This program covers the tax credits claimed on Form 1040. Two new IRS schedules are introduced: Schedule 3 (Non-Refundable Credits) and Schedule 5 (Other Payments and refundable Credits.)Tax credits are different from deductions from and for adjusted gross income. As opposed to reducing the amount of income subject to taxation, tax credits reduce the amount of tax directly on a dollar-for-dollar basis. As evidenced by the flow of Form 1040 and the supporting schedules, the available credits are applied against the tax liability in a specific order: first, the nonrefundable personal credits, then other nonrefundable credits, then business credits, then the investment tax credit (ITC), and then the refundable credits. Within the group of nonrefundable personal credits, those that cannot be carried over, if they are not fully utilized in the current year, are applied before those that can be carried to other periods. This course is most appropriate for the professional with detailed knowledge of Form 1040 who may be at a mid-level position within an organization with operational or supervisory responsibilities, or both.
Upon successful completion of this course, the user should be able to:
recognize which credits are refundable and which are nonrefundable,
identify the rules for claiming the child and dependent care credit, the credit for qualified retirement savings contributions, the child tax credit, the credit for other dependents, residential energy credits, as well as other tax credits applicable to individual taxpayers, and
determine the Hope scholarship/American opportunity and lifetime learning education credits, and apply the interaction limitations between the credits.