Predictable tax credits
Submitted by ChrisCowles on Sat, 01/17/2015 - 12:03
I have two kids in college. One of them being a senior, I have experience getting educational tax credits. I'm considering adding those tax credits as non-taxable income in the years I anticipate getting them. (My son is a freshman so I have 3 more years to look forward to, assuming Congress doesn't eliminate them.) I'd be conservative in my estimates but it's money in the pocket that is otherwise ignored.
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dan royer
Sun, 01/18/2015 - 17:44
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I did that too to try to get
I did that too to try to get my taxes a bit closer. But if I recall, it made very little diff in my discretionary spending. I can ask Mike his opinion. He's the tax expert.
Mike OConnor
Sun, 01/18/2015 - 18:08
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I think that you're handling
I think that you're handling it correctly. Of couse small credits for a few years have a small affect on the lifetime standard of living.
ChrisCowles
Sun, 01/18/2015 - 21:52
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Thanks, Dan and Mike. In my
Thanks, Dan and Mike. In my case it might make a noticeable difference because the credits occur before retirement, and my regular assets hit 0 in the last year before retirement. That causes a break in the smooth standard of living. (That's okay with me because the discretionary spending forecasted for those years matches my budgeted discretionary spending.)
Because of that break, I suspect the added cash will isolated to those years and, being compressed into a short period, may be noticeable.