-
Can I contribute to both an SEP-IRA or 401(k) and a traditional IRA, and claim deductions for both?
Contributed by: AnthonyS, FreeTaxUSA Agent, Tax Pro If you’re self-employed or have access to a workplace retirement plan and you’re thinking about maxing out your retirement savings, you might wonder: Can I contribute to both a traditional IRA and an SEP-IRA or 401(k), and deduct both on my taxes? The short answer is yes…
-
How does the EITC work? Why does the amount decrease?
Contributed by KiaraB, FreeTaxUSA Agent TaxPro As FreeTaxUSA support agents, we often get asked questions like, “Why am I not getting the EITC?” and “Why did the Earned Income Tax Credit go down when I had more income?” Here is a simple explanation so you can understand how the Earned Income Tax Credit (EITC or EIC) works.…
-
How Do I Report a Backdoor Roth (2024 and later)?
Contributed by: RachelR, FreeTaxUSA Agent, Tax Pro There are two different types of Individual Retirement Accounts (IRAs) – Traditional and Roth. With a Traditional IRA, you'll usually qualify to get a tax deduction in the current year for any IRA contributions you make during the year. When you retire and begin using the…
-
IRA recharacterization vs. conversion: key differences
Contributed by: AndyS, FreeTaxUSA Agent, Tax Pro Understanding the difference between an IRA recharacterization and an IRA conversion can be a bit tricky. While they might seem similar, it's important to know how they differ. The way these transactions are reported on your tax return can vary significantly and might impact…
-
What are qualified education expenses for claiming an education credit?
Contributed by: Henry, FreeTaxUSA Agent, Tax Pro Paying for higher education can be expensive — but claiming education credits, such as the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC), may provide some relief. Whether you’re a student or have a student dependent, the IRS offers valuable…
-
How do Health Savings Accounts and excess contributions impact taxes?
Contributed by: TriciaD, FreeTaxUSA Agent, Tax Pro Health Saving Accounts (HSAs) are popular for managing healthcare costs with tax benefits. Taxpayers with high-deductible health plans (HDHPs) can contribute pre-tax money to an HSA for qualified medical expenses. However, annual IRS contribution limits apply (plus…
-
Am I eligible for the Earned Income Tax Credit (EITC)?
Contributed by: WrenD, FreeTaxUSA Agent, Tax Pro If you're working and earning a low to moderate income, the Earned Income Tax Credit (EITC) could put money back in your pocket. It's a valuable tax credit designed to help working individuals and families, but the rules can be a little confusing. In this article, we’ll walk…
-
What kinds of health insurance premiums can be deducted as itemized medical expenses?
Contributed by: BariS, FreeTaxUSA Agent, Tax Pro Many kinds of insurance premiums, if paid out of pocket, may qualify as a medical itemized deduction. We’ll look at different types of insurance premium payments so you can determine what your situation may be. Perhaps you’ll find an additional itemized medical deduction.…
-
What is happening to the clean vehicle credits, and when will the changes take effect?
Contributed by: Joshua C., FreeTaxUSA Agent, Tax Pro The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, has introduced sweeping changes to federal tax policy, including a dramatic shift in how clean vehicle credits are handled. Previously, under the Inflation Reduction Act, the clean vehicle credit…
-
How does the One Big Beautiful Bill Act (OBBBA) impact energy efficient home improvement credits?
Contributed by: TriciaD, FreeTaxUSA agent, Tax Pro In 2025, President Trump enacted the One Big Beautiful Bill Act (OBBBA), introducing significant revisions to deductions related to energy-efficient home improvements. This legislation reduced or eliminated numerous tax credits and deductions previously provided under the…