How Does Your New Baby Fit In With Your Tax Obligations?
You have finally mastered your tax obligations as a married couple, now everything changes because you have added a new little one to your family. You are now going to have to make some adjustments to the way you file your taxes and also you and your spouse will have some tax decisions to make.
Having a new baby in the family is a wonderful experience, and you will find that there are a lot of things that you can take advantage of now from a tax point of view. A lot of times new parents are so busy with adapting to being parents and assuming all the extra duties and responsibilities that come with this that they just don’t seem to find the time to discover what potential tax benefits are available to them now and in the near future as well.
Another thing that newly married couples don’t realize is that the filing of their taxes now can help to determine what benefits they will receive in the future regarding children. One of the most important tax credits for new parents is the CCTB which is the Canada Child Tax Benefit. This relates to a sum of money you will receive each and every month if you qualify from the government to help cover the costs of raising a child. How much you receive is determined by your previous tax filings of both you and your spouse. This is why it is most important that both parties file their returns every year even if they have nothing to claim as income.
There are a lot of potential tax benefits when it comes to having a child and this just may be the year that you want to turn to the professionals for some tax help. Having an accountant that is experienced do your taxes for you not only helps you get every credit you are eligible for but these experts can guide you with some tax planning.
There are some potential child care expenses that you may be able to claim if you have gone back to work and are now faced with daycare expenses. However, these may even be applicable if you have chosen to go back to school. Of course for every child benefit that the CRA there are rules that must be followed and specific criteria that must be met in order to become eligible. It is most important that you know these before making your final decisions as what you decide to do can impact your tax situation.