Tax Credits vs. Tax Deductions What’s the Difference?
WHAT IS A TAX CREDIT? A tax credit will lower the amount of tax you owe or increase the amount you’re owed by the IRS once your tax rate is calculated. If you go through the deduction portion of your return and are determined to owe $5,000 in taxes, for example, then you can lower that amount (and even end up with a return) by applying for tax credits. These credits are generally dollar- for-dollar credits, meaning a $1,000 tax credit will reduce what you owe by $1,000. Of course, this is a very simplified version of how deductions and credits impact your return. There are many more deductions and credits that business owners should be aware of when it comes time to file their taxes. Tyler has a master’s in tax law and knows the ins and outs of these important tax factors. Contact us if you need help navigating your credits and deductions.
Tax law can feel like a minefield for even the most knowledgeable business owners. There are innumerable rules and regulations to follow to get your returns done correctly. To help you navigate that minefield, we’ve broken down two often- misunderstood tax terms: tax credits and tax deductions. WHAT IS A TAX DEDUCTION? When you file your taxes, you work to determine the amount of taxable income
you have in order to calculate the tax you owe. Deductions play a role in finding that amount because they can lower your total gross income. You may be eligible for numerous deductions in two categories: subtract these deductions from your gross income before calculating your adjusted gross income (AGI). They are “adjustments to income” and help lower your AGI, allowing you to be eligible for more below-the-line deductions. 1. Above-the-Line Deductions: You 2. Below-the-Line Deductions: These deductions come into play after you’ve calculated your AGI by applying above-the-line deductions. If you itemize your deductions, you can claim certain expenses, such as medical or dental expenses that exceed 7.5% of your AGI, charitable contributions, and more.
Feta Chicken Burgers
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Try these delicious chicken burgers with a Mediterranean spin on the classic sandwich we all love. Featuring Greek-style toppings and seasonings, this recipe is refreshing and super healthy, too.
Inspired by TasteOfHome.com
Ingredients • 1/4 cup finely chopped cucumber • 1/4 cup reduced-fat mayonnaise BURGERS: • 1/2 cup chopped roasted sweet red pepper
• 1 tsp garlic powder • 1/2 tsp Greek seasoning • 1/4 tsp black pepper • 1 1/2 lbs lean ground chicken • 1 cup crumbled feta cheese • 6 whole wheat hamburger buns, split and toasted
“Make the most of yourself by fanning the tiny, inner sparks of possibility into flames of achievement.” –Golda Meir
Directions 1. Preheat broiler and mix chopped cucumber and mayonnaise. 2. For the burgers, mix the red pepper, garlic powder, Greek seasoning, and black pepper. Add chicken and cheese; mix lightly but thoroughly (the mixture will be sticky). Shape into 6 patties about 1/2-inch thick. 3. Broil burgers, remembering to cook both sides thoroughly. Serve on buns with cucumber sauce. If desired, top with lettuce and tomato. Enjoy!
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