Topic 513 – Work-Related Education Expenses
You may be able to deduct work-related education expenses paid during the year as an itemized deduction on Form 1040, Schedule A (PDF), Itemized Deductions. To be deductible, your expenses must be for education that (1) maintains or improves your job skills or (2) that your employer or a law requires to…[Read more]

Topic 514 – Employee Business Expenses
If you’re an employee, you may be able to deduct your work-related expenses as an itemized deduction (subject to limitations) on Form 1040, Schedule A (PDF), Itemized Deductions. Additional information on this subject can be found in the Form 1040, Schedule A Instructions. Also, you may refer to Topic 511 for…[Read more]

Topic 515 – Casualty, Disaster, and Theft Losses (Including Federally Declared Disaster Areas)
Generally, you may deduct casualty and theft losses relating to your home, household items, and vehicles on your federal income tax return. You may not deduct casualty and theft losses covered by insurance unless you file a timely claim for reimbursement…[Read more]

Topic 551 – Standard Deduction
The standard deduction is a specific dollar amount that reduces the amount of income on which you’re taxed. Your standard deduction consists of the sum of the basic standard deduction and any additional standard deductions for age and/or blindness. In general, the standard deduction is adjusted each year for…[Read more]

Topic 552 – Tax and Credits Figured by the IRS
If you qualify, you may opt to have the IRS figure your tax and certain credits on Form 1040EZ (PDF), Form 1040A (PDF), or Form 1040 (PDF). This option is available even if you’re not required to file a tax return but would like to request a refund of taxes paid or would like to claim certain tax…[Read more]

Topic 553 – Tax on a Child’s Investment and Other Unearned Income (Kiddie Tax)
The following two rules may affect the tax and reporting of the unearned income of certain children:

If the child’s interest, dividends, and other unearned income total more than $2,100, part of that income may be subject to tax at the parent’s tax rate instead of the…[Read more]

Topic 554 – Self-Employment Tax
You’re self-employed for this purpose if you’re a sole proprietor (including an independent contractor), a partner in a partnership (including a member of a multi-member limited liability company (LLC) that has elected to be treated as a partnership for federal tax purposes), or are otherwise in business for…[Read more]

Topic 556 – Alternative Minimum Tax
Under the tax law, certain tax benefits can significantly reduce a taxpayer’s regular tax amount. The alternative minimum tax (AMT) applies to taxpayers with high economic income by setting a limit on those benefits. It helps to ensure that those taxpayers pay at least a minimum amount of tax.

How Is the AMT…[Read more]

Topic 557 – Additional Tax on Early Distributions from Traditional and Roth IRAs
To discourage the use of IRAs distributions for purposes other than retirement, you’ll be assessed an additional 10% tax on early distributions from traditional and Roth IRAs, unless an exception applies. Generally, early distributions are those you receive from an…[Read more]

Topic 558 – Additional Tax on Early Distributions from Retirement Plans Other Than IRAs
To discourage the use of retirement funds for purposes other than normal retirement, the law imposes an additional 10% tax on certain early distributions from certain retirement plans. The additional tax is equal to 10% of the portion of the distribution that’s…[Read more]

Topic 559 – Net Investment Income Tax
A 3.8 percent Net Investment Income Tax (NIIT) applies to individuals, estates, and trusts that have net investment income above applicable threshold amounts.

Individuals
In the case of an individual, the NIIT is 3.8 percent on the lesser of:

the net investment income, or
the excess of modified adjusted…[Read more]

Topic 560 – Additional Medicare Tax
A 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation that exceeds the following threshold amounts based on filing status:

$250,000 for married filing jointly;
$125,000 for married filing separately; and
$200,000 for all other…[Read more]

Topic 561 – Individual Shared Responsibility Provision
The individual shared responsibility provision requires that, for each month during the year, you and all members of your family:

Have minimum essential coverage (MEC);
Qualify for an exemption; or
Make a shared responsibility payment when you file your 2016 federal income tax return in…[Read more]

Topic 601 – Earned Income Credit

To qualify for the credit, your adjusted gross income (AGI) must be below a certain…[Read more]

Topic 602 – Child and Dependent Care Credit
You may be able to claim the child and dependent care credit if you paid expenses for the care of a qualifying individual to enable you (and your spouse, if filing a joint return) to work or actively look for work. You may not take this credit if your filing status is married filing separately. The…[Read more]

Topic 607 – Adoption Credit and Adoption Assistance Programs
Tax benefits for adoption include both a tax credit for qualified adoption expenses paid to adopt an eligible child and an exclusion from income for employer-provided adoption assistance. The credit is nonrefundable, which means it’s limited to your tax liability for the year. However,…[Read more]

Topic 608 – Excess Social Security and RRTA Tax Withheld
Most employers must withhold social security tax from your wages. Certain government employers (some federal, state and local governments) don’t have to withhold social security tax.

If you work for a railroad employer, your employer must withhold Tier 1 Railroad Retirement Tax Act (RRTA)…[Read more]

Topic 610 – Retirement Savings Contributions Credit
If you make eligible contributions to certain eligible retirement plans or to an individual retirement arrangement (IRA), you may be able to take a tax credit. The amount of the saver’s credit you can get is generally based on the contributions you make and your credit rate. For more information,…[Read more]

Topic 611 – Repayment of the First-Time Homebuyer Credit
Repayment of the Credit

General repayment rules for 2008 purchases. If you were allowed the first-time homebuyer credit for a qualifying home purchase made between April 9, 2008, and December 31, 2008, you generally must repay the credit over 15 years. To repay the credit, you must increase…[Read more]

Topic 612 – The Premium Tax Credit
Individuals and families who purchase health insurance coverage through a Health Insurance Marketplace may be eligible for the premium tax credit. This tax credit helps make purchasing health insurance coverage more affordable for people with low to moderate incomes. The premium tax credit is refundable, so even…[Read more]