Last-Minute Tax Tips for Families

ByABC News via logo
April 12, 2004, 3:44 PM

April 13 -- Over the next two days, taxes will be weighing on the minds of millions of American parents.

It is projected that more than 32 million families will face a tax bill this year, but additional tax relief may be available for millions of parents because of the new tax laws Congress passed last year.

For example, many tax brackets were lowered. Those who were paying 27 percent now pay 25 percent; those who paid 30 percent now pay 28 percent; those who paid 35 percent now pay 33 percent; and those in the 38.6 percent bracket will now pay 35 percent.

Similarly, there are new enhanced tax credits and deductions available for the 2003 tax year that can still be taken advantage of, even though the April 15 filing deadline is fast approaching. It is important to make sure that you are taking advantage of new laws that work to your family's benefit, and that you take proper precautions to make sure the Internal Revenue Service does not rain on your post-tax celebration.

Child Tax Credits

So far, the child tax credit is the biggest source of mistakes on 2003 tax returns, with more than 2.3 million people having already made errors related to it. Assuming your family meets income requirements, the child tax credit is $1,000 for each child under the age of 17 in 2003, up from $600 per child in 2002.

However, when completing your 2003 tax return, do not forget to subtract any advance credits you may have received last summer. Specifically, 25 million taxpayers received an advance credit of up to $400 per child last July or August. If you were one of these taxpayers, you will have to subtract the amount of your advance and only take a partial credit.