All about Tax Credit Advisor

Firstly, what does the tax credit mean? Well, it is a provision that helps in reducing the taxpayer’s bill, this is a little different from the other exemptions and deductions, which reduce taxable income than the tax bill directly. These credits are divided into two different types: Non- refundable and refundable. The refundable credit has a provision where the taxpayer is allowed to receive the refund if their credit is greater as compared to the tax liability. Whereas, Non-refundable credits only get to receive a reduction in the tax liability till it reaches zero.

Who are Tax Credit Advisor? Those with skill in financial assets and specialist understanding in all tax law related aspects. Some of them are: accountings, tax laws, and more. They are sometimes known as tax consultants. Lawyers that specialize in tax law, CPAs (Certified Public Accountants), and licensed agents are additional examples of tax consultants.

What Does a Tax Advisor Do?

The role of tax credit advisors, whether employed by a company or working independently, is to find the most effective and economical solutions to reduce their customers' legal responsibilities. For their clients, they may also submit tax returns. Every taxpayer would be advisable to see a tax counselor if they had gone through a big life event, such as receiving an inheritance, losing a spouse, losing their job, giving birth to a kid or adopting one, getting married, divorcing, or another.

The healthcare tax credit also referred to as the “medical scheme fees tax credit”, The medical expenses get added up quickly and can cost us loads. So, it is advised for the taxpayer to keep a track of the estimated amount that can get them financial help whenever in need. The healthcare tax credit calculators can be of great help as it can also help in estimating the healthcare insurance at the marketplaces too.

As the marketplaces determine the tax credits, it becomes really important for the taxpayer to report all the changes immediately so that the healthcare plan eligibility can be updated sooner.

The Internal Revenue Service (IRS) permits some reimbursed dental and medical expenditures to be deducted, which can go up to 7.5% of an individual's adjusted gross income (AGI). As a result, medical expenses are also deductible.

Conclusion

The tax credits can directly reduce tax liabilities, and the tax credit advisors help in providing effective ways in getting the liabilities down. The advice and the services of the tax advisor can vary as it depends on the situation of the client/taxpayer. It is recommended to consult an advisor if you are planning for retirement, or set up a new business or even becoming a real estate investor as it takes a different tax requirement from being any commodity trader.