Ask a CPA is a column I write as a Certified Public Accountant to share accounting, business and tax knowledge to readers of The Corporate Sister.
As a working parent, you know how precious your kids are. You also know how expensive raising them can be. From the astronomical cost of childcare to medical bills, and the prospect of college education, the costs of being a parent keep increasing each and every year. Which is why most of us welcome any breaks we can get to help lighten the modern financial weight of parenting. Especially when it comes to tax breaks…
These tax breaks come in handy for working families at tax time. Some of these breaks come in the form of deductions, which reduce your taxable income, or the amount you’re being taxed on. Some examples of deductions include college tuition and fees for instance. Other tax breaks come in the form of credits, which are subtracted from your tax bill dollar for dollar or are added to your refund. An example of tax credit is the child-tax credit. However, both of these are subject to income limits.
If you’re wondering about these, here are 6 tax breaks you can get as a working parent:
The student loan interest deduction
For working parents needing to borrow money for their child’s college education, the student loan interest deduction provides some relief. As a parent, you can write off up to $2,500 in student loan interest. However, if you’re a married filer with a Adjusted Gross Income (AGI) between $135,000 and $165,000, the deduction starts phasing out. If you’re single, the same restriction applies if your AGI falls between $65,000 and $80,000.
The child-tax credit
As a result of the Tax Cuts and Job Act, for 2018 through 2025, this credit amounts to $2,000 per child as a federal income tax credit. There are no limits to how many children can qualify within a household. However, there is an income limit here, as with most tax credits. It starts to phase out for married-filing-joint couples with modified Adjusted Gross Incomes (AGI) over $400,000. For unmarried people, the phase-put starts at $200,000 of AGI.
The child and dependent care credit
If you’re a working parent in a household with two incomes or are looking for a job with children under the age of 13, you may qualify for this credit. If you’re a student or a disabled parent, you may also qualify.
Basically, this credit allows you to claim a credit of 20 to 35% on childcare expenses up to $3,000 for one child. For two (2) or more children, this credit is up to $6,000. Here as well, there is an income limit for parents earning more than $43,000, for whom the credit will begin to shrink.
American Opportunity Higher Education Credit
This credit helps with the cost of undergraduate college education. If your child is in their first four years of college, he or she may qualify for up to $2,500 a year worth of credit. The number of children to qualify in a household is not limited here.
However, there are income restrictions for married joint filers whose modified AGI is between $160,000 and $180,000. If you’re a single parent, then the credit phases out if your modified AGI is between $80,000 and $90,000.
Lifetime Learning Higher Education Credit
This second higher education credit applies to students who have more than four (4) years of college credit under their belt. It also applies to any other family members also taking classes. One major restriction of this credit is that it cannot be claimed more than once on any given tax return.
With this credit, you can claim 20% of tuition and other qualified expenses, up to $10,000 worth of expenses. The maximum credit you can then claim is $2,000. If you’re marrying filing jointly with your partner, this credit is phased out if your modified AGI is between $114,000 and $134,000. As a single parent, the same restriction applies if your modified AGI is between $57,000 and $67,000.
The adoption credit
If you’ve adopted a child, you may be able to claim an adoption credit to help with the related expenses. For 2018, this credit is up to $13,810. If you’ve adopted a special-needs child, you may take the entirety of the credit, even if your actual expenses are less than the credit. The income restriction is for parents with modified AGIs in excess of $207,140. Beyond $247,140 as a modified AGI, this credit is completely phased out.
“This year, I’m getting my life and staying organized for the holidays. Christmas shopping on time!” This is usually my vow to myself as the holidays approach. Fast-forward to a few weeksdays before Christmas, as I’m scrambling to get my last gifts bought and somewhat wrapped in the nick of time. Oh, and yes, it literally happens every year, along with the frustration and aggravation that inevitably follow…
The holidays are one of the busiest times of the year, especially for working women and moms. This is where the gift of organization comes in really handy, what with planning the festivities, buying and wrapping gifts, as well as handling your responsibilities at work and at home. I remember dreading the approach of the year end, at the thought of everything I would have to do, amplified by my chronic tendency to procrastinate. I finally hit a wall when I caught myself unwrapping gifts at midnight on Christmas Eve when I realized that all the tags had the wrong names on them. Not to mention the horrible mood I was in, which prevented me from being truly present and enjoying this most wonderful time of year.
Despite my best attempts at not controlling my procrastination, I had to give in. After much trial and error, wrapping and unwrapping gifts with the wrong tags, here are seven tips that took my holidays from stressful and overwhelming to peaceful and enjoyable:
Use the right organization tools
Getting organized requires the right tools to keep you on track. Anyone who knows me knows I’m obsessed with planners and office supplies. My absolute favorite is Erin Condren’s Life Planner, which is perfect for customizing how you plan your own schedule and to-do’s. The three weekly layouts to choose from let you plan your time, in your unique way! I enjoy the vertical weekly columns to annotate all my appointments, with the side spaces to include all my to-do’s for the week. I also love that it includes inspirational quotes and notes, along with stickers and extras to celebrate each task you accomplish, while you keep your spirits high all holiday long.
There is way too much to do over the holidays to pretend to do it all. Over time, I’ve learnt to distinguish what’s really important from what’s not, and prioritize my tasks. For me, this means simplifying my schedule by taking care of the essential, and letting the rest go. What deadlines have to be met by the end of the year at work and personally? What relationships are you set to honor with your time and gifts this season? How much of your personal and household chores can you realistically accomplish?
Answering these questions can go a long way in being more organized and less overwhelmed, which translates into actually enjoying, instead of resenting, the holidays.
Let go of control
I had to check myself at some point and recognize that most of my holiday stress was due to my then “control freak” tendencies. From wanting everything to be perfect to being anal over name tags, the need for control plays a large part in turning the holidays into a nightmare. Not to mention that every single task ends up taking more time than you’ll ever have, resulting in major disorganization, lateness and annoyances along the way.
What I’m learning is to let go of control and the need for perfection. “Done beats perfect” is my new motto, and has saved me much time, stress and energy too.
The holidays are a happy time. At least , judging by the highlight reel that is social media, it’s supposed to be. Yet, for many, it’s also a time of dealing more than usual with their dysfunctional families, laced with interludes of gift-giving and awkward sideways hugs. As a disclaimer, most, if not all families, include some element of dysfunctionality. If they didn’t, we’d all be bored out of our minds, and would be way too sane for our own good.
From the crazy uncle who always has something not-so-funny to say (especially after a couple of drinks), to your great-aunt asking why you’re not married (or not having another kid soon), not to mention your two aunties ready to jump at each other’s throat, there can be many ticking human bombs threatening to turn otherwise fun festivities into sheer tests of patience. Thankfully, there are also many positive ways to deal with normal (and abnormal) dysfunction in families without losing your mind (and your cool):
Mentally prepare yourself
I’ve learnt over time that potentially stressful situations require adequate prior mental preparation. Rather than buying your head in the sand and pretending all is well, start ahead of time by creating your own mental and spiritual shield.
First, think about and identify what and who triggers you during family events over the holidays. Is it a certain type of remarks? A particular individual? A specific topic of discussion? Knowing this will help you address any difficult situation before and as they arise.
If necessary, think of ways to answer to and even confront these situations. You may even have to rehearse these ahead of time. Before you start laughing, consider how better equipped you’ll be afterwards.
Strengthen yourself mentally and spiritually. It could be through positive affirmations, motivational messages, or simply by taking some time out to truly appreciate who you are and all that you’ve done. The more you appreciate yourself, the less room there will be for someone else’s negative opinion of or comment about you to take root…
You don’t have to avoid confrontation…
One of the biggest obstacles we may face over the holidays when dealing with dysfunctional families is due to our fear of confronting tough situations. This is especially true when dealing with family members. Unfortunately, it’s often those who are closer to us who can hurt us the most, and not facing them can bring about a lifetime of suffering and resentment.
The god news is, you don’t have to avoid confrontation at all costs. As long as you keep your interaction respectful, it’s ok to address situations that may make you uncomfortable. Sometimes, it’s just a matter of pointing out the hurt certain remarks or attitudes may cause you. While you may not be able to control others’ behavior, you owe it to yourself to stand up for yourself, with all due respect, including to yourself.
But prioritize your peace
I’ve learnt that there is no price too small to pay for peace. As much as you owe it to yourself to confront certain situations as necessary, prioritizing your peace is key. This may also mean avoiding an unnecessary argument, not participating in certain conversations, or even staying away altogether. It may also mean seeking closure and reconciling with a family member, or finally putting a long-lasting feud to rest.
What does peace mean to you over the holidays? Depending on your unique family situation, you may have to determine it for yourself.
Let it go!
Last but not least, while the holidays may at times be trying in dysfunctional families, it’s important to not carry the resulting baggage with you. We’re all different people with various sensitivities, feelings and experiences. Sour words may be exchanged, hurtful remarks made, or offensive behaviors had. At the end of the day, we must learn to let it go and move on.
Many, if not most families, have one or many dysfunctional elements, from interesting family members to painful pasts. Dealing with it can be challenging, but not impossible. As a matter of fact, it may be a wonderful opportunity to learn, strengthen yourself and come out on the other side as a wiser, stronger and more compassionate human being.
Going back to school as a working mom can seem like an impossible feat. If you add your parenting duties to your work responsibilities, not to mention the upkeep of the home, your ever-expanding mountain of laundry, and your attempts at not losing your quarterly date night, it would be a complete no-no.
As a working mom myself, going back to study for my Certified Public Accounting exam felt like sheer torture. It was not so much about adding one more giant pile of to-do’s to everything I was already behind on. It was more about the incessant guilt I felt about missing out on the time I could spend with my babies and spouse. It was also about having to consistently juggle loads of commitments, without barely having any time to myself.
Yet, as difficult and challenging as it is, it’s possible. As I look back on this time, and prepare myself to embark on another scholarly journey, there are a few tips I learnt in the process that I can share here:
Clarify your “Why”
The first, and most important step, in the process of going to school as a working mom, is clarifying your “why”. Why are you doing this? Is it to improve your family’s situation? Is it to get a promotion, or change careers altogether? Is it to offer your children a better life? Or a combination of all these?
Knowing your “why” also allows you to see the light at the end of the tunnel, especially during those trying moments when all you want to do is quit. It’s this “Why” that will not only keep you going in hard times; but will also give you the motivation and drive to accomplish your goals.
Talk about it with your significant other and family members
As a working mom, you no longer are alone in making decisions, especially when it comes to life-changing decisions such as going back to school. This is why it’s so important to have honest conversations with your significant other and family members, including the children.
In order to succeed at this, you’ll need their support and complete buy-in. It’s important to discuss and answer important questions such as:
How will your family’s schedule change?
How can your significant other help you?
What changes will you have to implement to make it work as a family?
Make a lifestyle plan
Remember, this is not just about going back to school and getting re-acquainted with classes and homework. Rather, as a working mom, it means a whole lifestyle change that you have to be prepared for. Hence, the need for a complete lifestyle plan that will take into account the needs of all the family members, and allow you to thrive as a mom and a student.
For me, it was about overhauling my schedule and changing my lifestyle from one of family and work responsibilities, to one that included earlier mornings, later nights, and more sharing of commitments.
Adjust your expectations
Going back to school as a working mom is hard. There’s no more diplomatic way to put it. If you happen to be a perfectionist like myself, you may be tempted to maintain the same expectations you had before heading back to school.
However, it’s crucial to adjust your expectations to your new schedule and lifestyle. Not only will it save you much heartache, but it will also help you keep going when the going gets tough.
Be compassionate towards yourself
Last but not least, practice compassion towards yourself. This is a very rewarding, yet challenging process. It also means that you must forgive yourself for those nights when you just cannot stay awake to do your homework. Or those mornings when getting up early seems impossible. Or for not being the best mom at all times.
All in all, going back to school as a working mom is not only possible, but very much potentially successful, with the right mindset, approach and discipline. While it requires many adjustments, it may just be one of the most exciting, and rewarding, endeavors you’ll undertake.
As working women, we tend to wear many “working hats”. From caring for our families to juggling demanding careers, it can be easy to get caught in a whirlwind of activities. Especially as working moms, slipping into the sea of commitments, appointments, and obligations can become a daily occurrence, until we start thriving to work on purpose…
As I grew in my career and became a mom, I found myself increasingly lost in the midst of everything I had to attend to. It seemed as if I were always working. If I were not working at work, I’d be working at home on my second or third (or even fourth sometimes) shift. While I was clearly being busier than productive, the purpose of all I was doing, especially my work, was also lost to me. I was working to make money to pay the bills, and caring for my family as best as I could. Yet, there were many times when I asked myself: “Is this all there is? Why am I really doing all this?”, and “What is really my purpose in all this?”
I’m sure you may have asked yourself the same question many times over, at one point or another of your career or life. Most of us have. In a world that’s busier by the minute, even taking the time to think has to be scheduled way ahead of time. Yet, this lack of direction and purpose created by constant busy-ness is not just costing us our health and sanity. It’s also preventing us from doing our best work and living our best life.
A significant part of my growth as an individual and working woman has been centered around learning to work and live more on purpose. By this, I mean striving to be more intentional about what I do and how I do it. This process has thankfully brought me to change careers, alter my mindset, and even start exercising on an almost daily basis. It has been, and still is, a challenging process, as I’m tempted daily to sink into the dangerous pit of busy-ness and mindless achievement. Yet, with the help of mentors, through my faith and lots of trial and error, I’ve slowly come to laying manageable steps to work and live more on purpose as a working woman and working mom. Here’s what has worked for me, in 7 simple but not-so-simple iterations:
Start with the “Why”
“Why am I doing this?” This seemingly simple question has become one of my absolute go-to’s in everything, or at least almost everything, I start. Very often, we can start processes and experiences without knowing why we’re even engaged in them. From picking jobs and careers that are ill-fitted to our personalities and desires, to marrying the wrong man and choosing destructive friendships, we may waste precious time as a result of missing the “why” behind our decisions.
Why did you pick the job? Why are you entertaining these relationships? Why are you completing the degree? All these questions are not only necessary, but crucial to picking a direction in line with your purpose.
Develop a love affair with yourself
I had to fall back in love with myself, and embrace who I was created to be, before I could even begin working and living on purpose. Too many outside opinions, pieces of advice and external considerations had me going in personal and professional trajectories I wasn’t happy or fulfilled with.
Learning to know myself, what works for me and what doesn’t, what excites me and sets me on fire, has allowed me to walk away from jobs, careers and relationships that weren’t for me. It’s also helped me enter fields and develop relationships that bring me so much joy and fulfillment.
Learn your limitations and challenge them
However, this is not just about fostering a love affair with yourself and the world. It’s also about discovering your own perceived limits and challenging them to the best of your ability. Many, if not most times, these limitations, whether real or perceived, keep us from being more intentional and purposeful in our work and lives.
For me, working on purpose also involved facing my fear of public speaking. It means not just putting myself out there, but also learning the necessary tools and getting the right mentorship to become better at it.
Create a network that works for you
It takes a village to build a purposeful and intentional career and life. This is why it’s so important to build a network around you. Not just any network, but a network that works for you and fits your own life and career.
It took me a while to build the right networks for me. Getting over my fear to network, and then finding networks that feel like home, allowed me to really strive in my work and life.
Worry about fit more than appearances
Working on purpose is also a matter of knowing, and applying, what works for you. This is where the right fit comes in. What work fits you best? What type of environment fits you best? What work-life integration is best for you?
For me, it was a matter of understanding the best fit for me in terms of careers, locations and work-life integration. In turn, it helped me transition careers and lifestyles in a way that works best for me.
Cherish the process
Working and living more intentionally also requires trusting and cherishing the process. The longer I resented and resisted the process, the longer it took.
Release control
Last but not least, release excess control on the outcomes of your career and life decisions. There is a large part of our own individual processes that requires us to let go. I’ve learnt to do my best and release the outcome.
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