How to find hidden money when filing your taxes

How to find hidden money when filing your taxesHow to find hidden money when filing your taxesBank of Dadis a weekly column which seeks to answer questions about how tomanage moneywhen you have a family. Want to ask aboutcollege savings accounts,mortgage hacks, or how to be a little bitbetter with money?Submit a question to Bankofdadfatherly.com. Want advice on what stocks are safe bets? Ask your broker. And then tell us. Wed love to know.Thenew 2019 tax laws have a number of changes that I really dont understand. What are the most important ones, and how will they affect how Ifile my taxes? - Steve K, BostonPresident Trump signed theTax Cuts and Jobs Act(TCJA) more than a year ago. But now is the first time taxpayers have to figure out how the new rules will affect their return. For most people, the net effect will be a little more cash in your pocket this year about $900 for the typical middle-income earner, according to the Tax Policy Center.The changes to the IRS code are pretty extensive, but heres a look at some of the biggest. Keep in mind that most of the provisions expire after 2025, at which point we could have yet another set of rules on our hands.1. Brand new tax ratesPerhaps the most obvious change is the cut to individual tax rates. It gets a little confusing because the TCJA also revised the income ranges for each bracket. But most folks who used to pay a 15 percent rate, for example, are now paying 12 percent marginal rate. And the majority of taxpayers who used to be in the 28 percent bracket will now pay a 24 percent rate. Heres a chart to help you out2. A larger standard deductionFor the 2017 tax year, you could take a standard deduction of $12,700 if you filed a joint return (it was $9,350 for heads of household and $6,350 for single filers). The TCJA nearly doubled those amounts. Now, joint filers can deduct $24,000. Those filing as a head of household can take $18,000 from their taxable income single filers can take a deduction of $12,000 .As a result, fewer people will have an incentive to itemize their deductions, which should also make preparing the 1040 a less mind-numbing experience. Fingers crossed.3. A more generousChild Tax CreditPart of the TCJAs munificence includes a doubled child credit of $2,000 per kid. The refundable amount - what you get if your credits surpass your tax liability - is capped at $1,400.And this year, a lot more people are able to take advantage of it. For joint filers, the credit started to phase out for joint filers after $110,000 of income now the cap is $400,000 for couples preparing a joint return (or $200,000 for individuals).Before getting too excited, realize that the more generous credit is at least parteially offset by the end of the personal exemption, which allows $4,050 per-person deduction for yourself, your spouse, and each child in your household. Depending on your tax bracket, you might not be getting a substantially bigger break.4. A state and local tax capWhile the TCJA threw a lot of goodies at the tax-paying public, it wasnt quite as kind to homeowners inmore expensive parts of the country.Beginning in 2018, the deduction for state and local taxes including property, income and sales taxes is capped at $10,000.On top of that, you can only deduct the interest on mortgage balances up to $750,000. People who took out their home loan prior to 2018 are grandfathered in, so the limit doesnt apply.Its tax season and Im a new, first-time parent. This is new territory for me and Id hate to lose out on money for not being aware of the new changes. What are all the tax deductions and credits I, and other new parents, need to know about? - Paul O., Oklahoma CityHaving a baby is likely themost expensive decisionyouve ever made, so by all means, take advantage of those sections of the tax code aimed at giving parents relief. Heres what you need to know.1. Child tax creditFor a lot of parents, the single most important break is the child tax credit, esp ecially now that its doubled in size. Unlike deductions, credits are dollar-for-dollar reductions in your tax bill. So, no, you dont want to overlook this one.2. Child and dependent care creditIf you paid someone to take care of your child while you worked or even looked for work you may also qualify for the child and dependent care credit. To qualify, your child had to be under 13 years of age at the end of the calendar year. Dont think the credit is just for parents who use daycare, though. Babysitter fees, preschool tuition and even summer day camp expenses are eligible, as long as you worked while your kid was there.3. Earned income creditThe earned income credit, or EIC, is another nice perk for parents, although its only available to those with low- and moderate-incomes. If you or your spouse was out of work for part of the year or went back to school, its certainly worth checking to see if you qualify. Its a refundable credit, so you can actually get a refund even if your t ax liability was zero.4. Adoption tax creditAs long as you fall below the income limit, parents can also expect some relief if they recently adopted a child. For 2018, the IRS lets parents take a credit of up to $13,810 for a range of expense, including travel expenses, attorney fees and court costs. Given how pricey adoptions can be, youll be glad to get at least some of that money back at tax time.5. Education tax creditsFinally, Ill mention a couple credits that can help offset the cost of a college education the American Opportunity Tax Credit and the Lifetime Learning Credit. While the former offers a slightly bigger benefit, it also comes with tighter eligibility requirements. Both credits help defray the cost of tuition, fees and books. And, really, who couldnt use some help with that?This article was originally published on Fatherly.