Research to compare tax credits and their corresponding forms. - Compare the current tax year with the prior tax year (for instance, 2021 and 2020). - Research the forms required for the respective tax year and complete the table. - Follow the example provided for Earned Income Tax Credit (EITC). Hint: Changes in requirement and parameter may include the following areas: amount of credit, income thresholds, qualified dependents and/or filing status. Note: All tax credits will be different and will contain varying amounts of information based on changes you observe over time. EXAMPLE: Form 1040 Earned Income Tax Credit (EIC) Address the following: Specify changes, uses, developments: - Example of when this may apply using - The Earned Income Tax Credit (EITC), also referred to as EIC, helps low-toprofessional terms to describe clients moderate income workers and their families by potentially reducing the taxes - Changes to the form from year A to year B they owe and potentially increasing their refund. The credit varies depending on - Changes to areas to consider from year to the taxpayers income, if they have any children or other dependents, if they are year disabled, and/or if they meet other criteria. The taxpayer must have "earned - Possible new developments and why they income" to qualify, which includes taxable income or wages from working for may occur someone else, yourself, or a business you own. - Required forms - The EITC is reported directly on Form 1040, but the line may change from year to year. For example, for 2020, EITC was reported on Form 1040, page 2, line 27 but for 2021, EITC was reported on Form 1040, page 2, line 27 a (and includes lines 27a-c). Schedule EIC is filed for taxpayers with qualifying children, however, there are not notable differences between the schedule for 2020 to 2021 . For detailed examples of calculating the EITC and how to complete the applicable forms, refer to Publication 596. - Changes to consider - The criteria for adjusted gross income and the number of children or relatives claimed for the tax year impact the calculation of this credit. For example, in 2020, the maximum credit that could be claimed by a taxpayer filing as single with zero children claimed, whose AGI was between $15,820 to $21,710, was $538. In 2021, however, the maximum credit that could be claimed by a taxpayer filing as single with zero children claimed whose AGI was between $21,430 to $27,380, was $1,502. - New developments - The example provided above, noting such as an increase in the EITC from 2020 to 2021 for the same scenario, was a result of expanded tax credits for taxpayers filing without dependent children for 2021, and there are also changes for beyond 2021 relating to the credit. Refer to the IRS Article below titled "IRS: Expanded credits for families highlight tax changes for 2021 ; 1. Form 8863 Education Tax Credit American Opportunity Tax Credit (AOTC) Address the following: Specify changes, uses, developments: 1. Form 8863 Education Tax Credit American Opportunity Tax Credit (AOTC) Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to - Possible new developments and why they . may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 2. Form 8863 Lifetime Learning Credit (LLC) Address the following: Specify changes, uses, developments - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 3. Form 8812 Child Tax Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 4. Form 8812 Other Dependent Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 5. Form 2441 Child and Dependent Care Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the Research to compare tax credits and their corresponding forms. - Compare the current tax year with the prior tax year (for instance, 2021 and 2020). - Research the forms required for the respective tax year and complete the table. - Follow the example provided for Earned Income Tax Credit (EITC). Hint: Changes in requirement and parameter may include the following areas: amount of credit, income thresholds, qualified dependents and/or filing status. Note: All tax credits will be different and will contain varying amounts of information based on changes you observe over time. EXAMPLE: Form 1040 Earned Income Tax Credit (EIC) Address the following: Specify changes, uses, developments: - Example of when this may apply using - The Earned Income Tax Credit (EITC), also referred to as EIC, helps low-toprofessional terms to describe clients moderate income workers and their families by potentially reducing the taxes - Changes to the form from year A to year B they owe and potentially increasing their refund. The credit varies depending on - Changes to areas to consider from year to the taxpayers income, if they have any children or other dependents, if they are year disabled, and/or if they meet other criteria. The taxpayer must have "earned - Possible new developments and why they income" to qualify, which includes taxable income or wages from working for may occur someone else, yourself, or a business you own. - Required forms - The EITC is reported directly on Form 1040, but the line may change from year to year. For example, for 2020, EITC was reported on Form 1040, page 2, line 27 but for 2021, EITC was reported on Form 1040, page 2, line 27 a (and includes lines 27a-c). Schedule EIC is filed for taxpayers with qualifying children, however, there are not notable differences between the schedule for 2020 to 2021 . For detailed examples of calculating the EITC and how to complete the applicable forms, refer to Publication 596. - Changes to consider - The criteria for adjusted gross income and the number of children or relatives claimed for the tax year impact the calculation of this credit. For example, in 2020, the maximum credit that could be claimed by a taxpayer filing as single with zero children claimed, whose AGI was between $15,820 to $21,710, was $538. In 2021, however, the maximum credit that could be claimed by a taxpayer filing as single with zero children claimed whose AGI was between $21,430 to $27,380, was $1,502. - New developments - The example provided above, noting such as an increase in the EITC from 2020 to 2021 for the same scenario, was a result of expanded tax credits for taxpayers filing without dependent children for 2021, and there are also changes for beyond 2021 relating to the credit. Refer to the IRS Article below titled "IRS: Expanded credits for families highlight tax changes for 2021 ; 1. Form 8863 Education Tax Credit American Opportunity Tax Credit (AOTC) Address the following: Specify changes, uses, developments: 1. Form 8863 Education Tax Credit American Opportunity Tax Credit (AOTC) Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to - Possible new developments and why they . may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 2. Form 8863 Lifetime Learning Credit (LLC) Address the following: Specify changes, uses, developments - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 3. Form 8812 Child Tax Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 4. Form 8812 Other Dependent Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the taxpayer(s), etc.) Citations - Include related IRS publications, IRS articles, tax forms for each year used for comparison, and any other supporting research 5. Form 2441 Child and Dependent Care Credit Address the following: Specify changes, uses, developments: - Example of when this may apply using professional terms to describe clients - Changes to the form from year A to year B - Changes to areas to consider from year to year - Possible new developments and why they may occur Documentation if applicable (statements from taxpayer(s), other substantiating proof, official IRS tax forms provided to the
