Video instructions and help with filling out and completing Form 2220 Exemption

Instructions and Help about Form 2220 Exemption

Hi this is John with PDF tax this is form 1040x the amended individual income tax return and we're going to look at this to see what happens when you change the exemption amount so I've set this up for Fred and Margaret Jones and they are married filing jointly so I'll check that and this is going to be a 2017 and we're going to assume that they filed their original return with just one dependent but they actually had to somehow they forgot to include the second one on their original return so they need to add that back to to get the exemption for that second dependant on the 1040 X and which is what we're going to do right now so first I'm going to do is fill out this column for the original amounts and we're gonna say that they had $40,000 of wages and then there's Jenny deduction for 2017 for married filing joint would be 12 7 like that and on line four for their three dependents that that is they have an exemption for themselves plus their one dependent for us for a total of three so and that is 12150 which is 4050 times 3 and then on the line six they computed their tax from the tax table that's the most common way to do it so that's that unless I spelled that wrong there we go and so attacks on 15 150 from the tax table for married filing joint would be one five one eight like that and they did have one dependent on their original which was under under seventeen years old so they got a credit a child tax credit for a thousand dollars you get a thousand dollars per child if the child qualifies so on line 11 you come down to a total tax of 518 dollars but they also had some income tax withheld of two thousand and on line fourteen they also had an earned income credit of eight hundred and twenty-eight dollars because they qualified for that with one dependent so their refund on their original return was twenty three ten and we need to put that on line 18 the overpayment as shown on the original return is 23 ten like that so that is their original amounts that they have now in order to add that second dependent we need to scroll down to page two here which is where we changed the exemptions and originally they had two exemptions one for each of them and one for the one dependent that they did include but they're gonna increase that now on there a minute or turn by one so now they've got a total of four and their exemption amount would have increased by four thousand and fifty dollars like that so another exemption amount is going to be 16 - but they also need to list their dependents here on this line so we'll say Carol Jones was the first one that they a clue included on their original and her social might have been something like that she's a daughter and she qualifies for the child tax credit which we already took on the original return but the one they forgot was Sam Jones and they put him here like this and we'll make up a social for him and he has a child tax credit I actually had to do this a couple years ago because on my original return I transposed the social security number of my son and so the IRS disallowed that exemption so I had to do an amended return to get that back so that that might be why they forgot Sam on their original but in any case they're gonna add him back here so that's how that works like that now since they added that exemption we already know that their exemption amount increased to 12 r16 - so if we go back up here and look at line four we can see that's right there 16 - so now the taxable income is 11 100 and that of course is going to change the tax that will decrease the amount of tax by four hundred and five dollars so we're going to put a negative 405 in there like that so the corrected tax now is a one one three and on line seven they've got another dependent that qualifies for the child tax credit so they get two thousand instead of one thousand but the child tax credit is a little bit funny because it's split up into two parts you have a part that's non-refundable and apart that's refundable what that means is that on the non-refundable part you can only take credit up to the amount of tax and the amount of tax right now is 113 so we'll put that right there right there so now the tax shows at zero and then down here on line see what line this is 15 they'll take the other part of the child tax credit from schedule 8812 and we'll need to fill that out and attach that to the 1040 x1 send it to the IRS and so we'll put 887 here like that so the 887 plus the one 1/3 equals one thousand so they're getting another $1,000 but they had to split it up between those two lines like I said and one other thing that happened when they add another dependent is that increases their Earned Income Credit and that will increase by 1398 like that so now it's 20 to 26 so now if we scroll down here we see that we're getting a refund now of 2803 so that was really a valuable thing for those taxpayers to do to add that dependant back because they got a lower tax they got another child tax credit and they got an increased Earned Income Credit so worked out really