So much changes when you become a parent.<\/p>\n
You stop worrying about missing that trendy pop-up dinner, and start worrying about feedings and sleep schedules.<\/p>\n
Your idea of entertainment changes from an exciting night out with friends, to a relaxing evening of Netflix and a (hopefully) sleeping baby.<\/p>\n
And last – but certainly not least – your tax situation changes. Here\u2019s a brief overview of how your taxes as a new parent will be different.<\/p>\n
You\u2019ll change your withholding<\/strong><\/p>\n One of the first things to do once your child is born is to change your withholding. If you\u2019re employed, you\u2019ll have to fill out a new W-4 form for your employer, increasing your dependents.<\/p>\n If you\u2019re self-employed, you\u2019ll need to recalculate your estimated taxes for the year.<\/p>\n You\u2019ll be claiming a new dependent<\/strong><\/p>\n Adding your child to your tax return as a dependent will give you an immediate exemption, reducing your taxable income by $4,050 in 2017.<\/p>\n To claim your child, you\u2019ll have to have their Social Security number. If you didn\u2019t apply for a Social Security card for them at the same time you applied for a birth certificate, you can do so now. You\u2019ll need to have proof of their age, identity, and citizenship, and file the correct form with the Social Security Administration.<\/p>\n You\u2019ll get a tax credit<\/strong><\/p>\n Depending on your income, you could receive a Child Tax Credit of up to $1,000 per child. The income threshold is different for each filing status, so using an online tax service like E-File can help you ensure you\u2019re getting every cent of the tax credit you\u2019re eligible for.<\/p>\n You can deduct childcare costs<\/strong><\/p>\n If you work, earn taxable income, and pay for childcare to allow you do so, you can deduct your childcare expenses up to $3,000 for one child under age 13, and up to $6,000 for two children under age 13. The amount you receive will depend on the amount of your taxable income.<\/p>\n This deduction applies to more than just daycare providers, too. You can deduct what you paid a babysitter, nanny, summer camp provider, or other household staff (like a housekeeper) to care for your child, as long as that care was provided so that you could work. Sorry – date night babysitters won\u2019t count come tax time!<\/p>\n Bottom line: You\u2019ll likely see your overall tax bill reduced, although there are eligibility requirements for each credit and deduction<\/strong><\/p>\n Having a child isn\u2019t easy on your finances, which is why the IRS gives out these credits and deductions to parents. While your spending will undoubtedly rise after you have a child, your tax bill will often go down.<\/p>\n It\u2019s important to remember that every credit and deduction you claim has eligibility requirements, so use a service like E-file<\/a> to make sure you claim everything you can, and nothing you shouldn\u2019t.<\/p>\n","protected":false},"excerpt":{"rendered":" So much changes when you become a parent. You stop worrying about missing that trendy pop-up dinner, and start worrying about feedings and sleep schedules. Your idea of entertainment changes from an exciting night out with friends, to a relaxing evening of Netflix and a (hopefully) sleeping baby.<\/p>\n