Raising children can be very hard on parents, and the bad economy conditions are making it even more difficult. A good tax tip for parents is to know that your children may help you qualify for some tax benefits.

Here are top tax tips that parents should consider when filing this year’s tax returns:

1. Dependents
   In most cases, a child can be claimed as a dependent in the year they were born. For more information and other tax tips pertaining to dependents see IRS Publication 501, Exemptions, Standard Deduction, and Filing Information.
2. Child Tax Credit
   You may be able to take this credit on your tax return for each of your children under age 17. If you do not benefit from the full amount of the Child Tax Credit, you may be get tax help in the form of an Additional Child Tax Credit.
3. Child and Dependent Care Credit
   Another great tax tip is that if you pay someone to care for your child (under age 13) while you work or look for work, you may be able to claim the Child and Dependent Care credit.
4. Earned Income Tax Credit
   The EITC is a benefit for certain people who work and have earned income from wages, self-employment or farming. EITC reduces the amount of tax you owe and may also give you a refund. For more information see IRS Publication 596, Earned Income Credit.
5. Adoption Credit
   You may get some tax help by taking a tax credit for qualifying expenses paid to adopt an eligible child. Taxpayers claiming the adoption credit must file a paper tax return because adoption-related documentation must be included. For more information, see the instructions for IRS Form 8839, Qualified Adoption Expenses.
6. Children with Earned Income
   If your child has income earned from working they may be required to file a tax return. For more information see IRS Publication 501.
7. Children with Investment Income
   Under certain circumstances, a child’s investment income may be taxed at the parent’s tax rate. For more income tax help see IRS Publication 929, Tax Rules for Children and Dependents.
8. Higher Education Credits
   Education tax credits can help offset the costs of education. The American Opportunity and the Lifetime Learning Credit are education credits that reduce your federal income tax dollar-for-dollar, unlike a deduction, which reduces your taxable income. For more tax tips see IRS Publication 970, Tax Benefits for Education.
9. Student loan Interest
   You may be able to deduct interest you pay on a qualified student loan. The deduction is claimed as an adjustment to income so you do not need to itemize your deductions. For more information see IRS Publication 970.
10. Self-employed health insurance deduction
    If you were self-employed and paid for health insurance, you may be able to deduct any premiums you paid for coverage after March 29, 2010, for any child of yours who was under age 27 at the end of 2010, even if the child was not your dependent. For more tax facts and tax tips see the IRS website.

Not all of the tax tips listed will increase your tax return but it will assure that you’re following IRS tax rules and regulations.

For more tax help, facts and information visit the IRS website

source: irs.gov