Advertisements
New here, so forgive my limited knowledge! I have 3 questions I am hoping someone can either answer or direct me to where I can find out more information... 1) We do not currently pay federal income tax (our income is a University Stipend) so I assume we are unable to receive any ATC refund - is this correct? 2) If the ATC becomes refundable in the future would we be able to carry an ATC claim (with form 8839?) into future years, and if so - how many years before this would expire? 3) Is there a chance that we will benefit, if for example, we pay enough income tax in 3-4 years to still receive an ATC, using credit form 8839 (or is there another form?)? Thank you so much for any help with these questions! Sarah
Like
Share
1 - If there is no tax liability, then you will not benefit this year from the current version of the Federal Adoption Tax Credit. 2 - You have your "refundable" and "non-refundable" backwards. It is the current version, where the credit is *non-refundable* that the carry-forward happens. You will do your taxes, fill out the forms for the tax credit, and claim $0 amount, and carry forward the rest of it to next year. 3 - As long as the credit remains non-refundable, and you have $0 tax liability, you will not benefit from the credit. If, however, you earn taxable income in the next 5 years, you can apply the credit that you have been carrying over to the tax liability that comes from that taxable income. 4 - (that you did not ask, but that I'm volunteering) if at some point the credit becomes *refundable*, then your tax liability is irrelevant. You would at that point get the amount you had carried over in one lump check. There is no carry-forward involved with refundable tax credits, because refundable means as long as you fill in your tax forms, you get the dollar amount you qualify for. Because you get it, there is nothing to carry over. Hope that helps. By all means, ask more questions if you have them.
Advertisements