Federal tax laws are no doubt complicated but they are important for people as well as the government
. By understanding these simple laws, we can easily economize our hard earned money at the time of tax filing.
Some events happen in our lives that changes the tax circumstance in the year or their occurrences. These events usually are not taken into account while calculating taxes; however knowledge about these events is required.
- Child adoption- If you are going for child adoption then you can qualify an IRS tax credit concordant with the federal tax laws. It is not a tax deduction however it serves as a credit and thus helps a lot in reducing your bottom line taxes. A person who has adopted a child is eligible for reimbursement.
- Payment for education - Federal tax laws makes all the college expense including tuition fees eligible for tax deductions. Broadly speaking, there are two types of tax deductions when it comes to payment for education and these are lifetime learning credit and hope credit. You should try to know more about these two situations
- Losing of jobs- Money received as a monetary benefit or as severance package due to unemployment is likely to taxed. However, the expenses that are incurred by an individual in searching for livelihood or a job are eligible for tax deductions under this law.
- Victim of disaster- Federal authorities gives special priorities to the disaster victims.