Child Tax Credit

In 2019, the credit for each child under the age of 17 is $2,000. For taxpayers with income above $200,000 ($400,000 married filing joint), the credit is phased out by $50 for each $1,000 of adjusted gross income above the threshold amount. For taxpayers whose tax liability is not large enough to fully utilize the […]

Minnesota minimum wage to increase 1/1/2020

The minimum wage for Minnesota will increase for inflation January 1, 2020.  The new minimum wage rate for large employers will increase to $10.00 per hour (from $9.86 currently) and small employers will increase to $8.15 per hour (from $8.04 currently).  PROVISIONS Thru 12/31/2019 Effective 1/1/2020 Larger Employer $9.86 $10.00 Small Employer $8.04 $8.15 90 […]

2019 Standard Mileage Rates

Beginning on January 1, 2019, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 58 cents per mile for business miles driven, up from 54.5 cents for 2018 20 cents per mile driven for medical or moving purposes, up from 18 cents for 2018 14 cents […]

Subtraction For Contributions to 529 Plans

Effective for tax years beginning after 2016, the legislation allows personal income taxpayers to subtract up to $1,500 ($3,000 for married joint filer) of contributions to any state’s Sec. 529 college savings plan or prepaid tuition plan. The subtraction excludes amounts that are rolled-over from other college savings plans and is limited to taxpayers who […]

When Does A Dependent Have To File A Return

A dependent has to file a return if the dependent has: Earned income only and the total is more than $12,200. Unearned income only (i.e. income which is not compensation for service) and the total is more than $1,100. Both earned and unearned income and the unearned income is more than $350 or the total […]

Lifetime Learning Credit

If a taxpayer, spouse, or dependent is a student, the taxpayer may be eligible for a nonrefundable credit of up to $2,000 (20% of the first $10,000 of qualified tuition and expenses). The credit is allowed for an unlimited number of years per taxpayer basis. It covers all 4 years of post-secondary education as well […]

Individual IRA Contributions (Traditional or ROTH)

If you and/or your spouse have taxable compensation (earnings subject to FICA and Medicare tax), you may be able to contribute to and Individual Retirement Account. The maximum Traditional IRA or ROTH IRA contribution for both 2019 and 2020 are $6,000 if under the age of 50 and $7,000 if age 50 or older as […]

American Opportunity Tax Credit

The American Recovery and Reinvestment Act of 2009 created a $2,500 higher education tax credit that is available for the first four years of college. The credit is based on 100% of the first $2,000 of tuition and related expenses (including books) paid during the tax year and 25% of the next $2,000 of tuition […]

Retirement Contributions

The table below are the retirement contribution limits for 2020 and 2019.  Individuals have until the due date of their tax return (April 15, 2020 for 2019 Individual Income Tax Returns) for certain retirement plans.  In addition, certain individuals may qualify for the retirement savers tax credit for their contributions.  Additional catch up contributions may […]

Minnesota Section 179 (Depreciation)

Minnesota limits Section 179 to $25,000 with an investment limit of $200,000. Minnesota allows taxpayers to claim the full bonus amount, but it’s apportioned over a six-year period. Taxpayers get 20% of the bonus depreciation, in the year the asset is placed in service. The other 80% must be added back, which is recovered when […]