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COLUMBUS, Ohio " Federal income tax filing requirements for individuals differ by filing status and age, and can change from one year to the next. Currently, the minimum gross income filing amount for most individuals filing as "single" is $9,350, and married taxpayers filing a joint return generally need to file if their gross income for 2010 was $18,700 or more (both figures are slightly higher for those age 65 and above).
Sometimes, however, those who don't need to file may still want to. That's because the only way to get a refund of surplus taxes withheld from pay is by filing a tax return. Filing is also the only way for qualified taxpayers to stake their claim to refundable tax credits, which reduce tax liability and can result in tax refunds.
The following are several federal tax credits that can really help reduce the tax load for qualified claimants.
The Earned Income Tax Credit is a refundable credit for workers who earned income less than $48,362 from wages, self-employment or farming last year. Income, age and the number of qualifying children determine the amount of the credit that can be as much as $5,666.
The Child and Dependent Care Credit is for expenses paid to care for qualifying children under age 13 or for a disabled spouse or dependent, so the parent or spouse can work or look for work. Expenses up to $3,000 for one or $6,000 for two or more qualifying individual(s) can be included.
The Child Tax Credit is for people who had a qualifying child under age 17 at the end of 2010. The maximum amount of the credit is $1,000 for each qualifying child. It can be claimed in addition to the Child and Dependent Care Credit.
The American Opportunity Tax Credit can be worth up to $2,500 per eligible student enrolled in a program that leads to a degree, certificate, or other recognized educational credential. The credit can be applied toward the first $2,000 of tuition and related expenses (including books) and 25 percent of the next $2,000 of tuition and related expenses paid during the taxable year.
The Lifetime Learning Credit may be as much as $2,000 for qualified expenses for graduate-level degree work. There is no maximum period for which the credit can be claimed.
The Making Work Pay Credit can be worth up to $400 for individuals and $800 for married taxpayers filing a joint return. Most workers have already received the benefit of the credit because their federal income tax withholding was reduced in 2009 and 2010. Because the amount of tax withheld was reduced, not claiming the credit on your 2010 tax return could result in a smaller refund or in some cases, a small balance due. Those filing a Form 1040 or 1040A will use Schedule M.
Energy efficient home improvements made in 2009 and 2010 may be eligible for a credit up to $1,500. For businesses and individuals buying electric vehicles, credits can be as much as $7,500.
These and other credits are available to eligible taxpayers. Since many qualifications and limitations apply to the various tax credits, taxpayers should visit the official IRS website at www.IRS.gov for more information.