When kids are out of school, you don’t want them to wander the streets all day. Summer day camps have become extremely helpful for working parents. Now, they are even more helpful when it comes to taxes. These extra expenses for summertime care can actually help you qualify for a tax credit. During school vacation, children under 13 can attend many different types of summer camps. These camps are provided by non-profits, the YMCA, and local churches to name a few. The IRS understands the added expenses, and they want you to know some facts about receiving credit for the camp costs. The five facts are listed below to qualify for the Child and Dependent Care Credit. 1. The amount of money paid for the day camp can contribute as an expense towards the child and dependent care credit. 2. Overnight camp expenses do not qualify for the credit. 3. Whether your childcare provider is a daycare facility or a sitter outside the home, you'll get some type of tax benefit if you qualify for the credit. 4. Depending on your income, the credit can be up to 35 percent of your qualifying expenses. 5. You may use up to $3,000 of the unreimbursed expenses paid in a year for one qualifying individual or $6,000 for two or more qualifying individuals to figure the credit. These expenses are not exclusive to summer camps. Any childcare expenses that qualify can be used for the Child and Dependent Care Credit. TaxSlayer.com has these instructions built into the program for e-filing federal taxes. The helpful interview process can guarantee you the biggest refund. For more information check out IRS Publication 503, Child and Dependent Care Expenses. Please contact TaxSlayer.com if you have any questions about the credit as well.

In order to get the largest refund possible as a minister, it is important to understand the basics of how a minister’s tax return may be different from other returns. 1. Most ministers are considered employees for Federal Income Tax purposes and are paid on a W-2. However, some ministers are self-employed such as some traveling evangelists and interim pastors. In these cases, you would receive a 1099- MISC and you would be required to report your income and expenses on a Schedule C. Also, many ministers that are employees of the church may be self-employed for other reasons such as speaking at guest appearances at other churches or performing services directly for individuals (such as weddings and funerals). 2. Even if you are considered an employee of the church and you receive a W-2 you will have to pay self-employment taxes on the income. Minister must pay self-employment tax unless they have filed a timely exemption application, Form 4361. You may file a timely form 4361 if you are opposed on the basis of religious consideration to the acceptance of benefits under the Social Security program. However, you are not exempt from paying Social Security Tax or Medicare tax on income you receive as a minister in any duty you perform that is considered self-employment income (such as weddings, funerals, and guest speaking appearances at other churches). 3. If you itemize and you are paid as an employee you may be able to deduct unreimbursed business expenses you incurred on your Schedule A. 4. You will need to use Schedule C or Schedule C-EZ to report earnings from marriages, baptisms, and funerals. 5. One of the most important benefits of being a minister is that you can qualify for a housing allowance. A housing allowance is used to pay for housing related expenses which include mortgage payments, rent, utilities, repairs, furnishings, insurance, property taxes, additions and maintenance. Ministers who own or rent their home do not pay Federal Income Taxes on the amount of compensation that their employing church designates as a housing allowance ahead of time. Although you do not have to pay Federal Income Taxes on your housing allowance it is subject to Self- Employment tax.

While the rest of us are dreaming of tax deductions, you, as a member of the Armed Forces, are likely trying to figure out which of your military pay is excludable from taxable income. You are probably aware that combat pay is not taxable while serving in a combat zone. Knowing where your other exclusions are is as important as your tax deductions in getting the income tax refund you want. Of course, certain type of pay is fair game on your income tax return, such as hazardous duty pay, drills, hardship duty, and submarine pay. The exception to this is if you perform these duties in a combat zone. There are many categories that are excludable items from your pay. These types of pay are either a reimbursement or allowance. There are generally 8 categories of excludable items and they include: Combat Zone Pay, Other Pay, Death Allowances, Family Allowances, Living Allowances, Moving Allowances, Travel Allowances, and In Kind Military benefits. For a detailed list of these items please visit IRS Publication 3: Armed Forces Tax Guide. Not only may you receive excludable pay on your Federal Income Tax Return but some states have military taxable exclusions as well. For example in 2010, the state of Virginia allowed service members to subtract the amount of combat pay for service in support of Operation Joint Endeavor that was included on their Federal Income Tax Return. Be sure to check your states deductions to ensure you are getting the maximum state income tax refund!

You have finally decided to make some long awaited improvements on your home. As you finalize your plans you should really consider taking advantage of potential tax credits for your home. Make sure you incorporate upgrades that not only will improve the look of your home but its energy effectiveness. There is still time to take advantage of the Residential Energy Credits that have been around for the last few years. This is the last year for tax payers to take advantage of them unless Congress decides to extend it once again. The following products below are eligible for tax credits through 2011 on your primary residence: Product Credit Biomass Stoves $300   HVAC $50- $300 Insulation 10% of the cost up to $500 Roofing 10% of the cost up to $500 Water Heater (non-solar) $300 Windows, Doors and Skylights 10% of the cost up to $500 but windows are capped at $200 As you plan where to start your remodeling, remember to begin with the products that you can benefit from on your tax return. These Residential Energy Credits are due to expire in 2011 and you must have your energy efficient improvements installed and ready for use prior to the end of the year in order to take the credit. Keep in mind if you have already claimed $500 or more in Residential Energy Credits from 2006- 2010 you are not eligible for anything more.