Three of the most significant U.S. tax credits reimburse taxpayers amounts surpassing $10,000, a strategy by the Internal Revenue Service (IRS) to support those earning less in the country, providing economic relief to those in greater need.
Filing taxes may not be a favorite task for many, yet it could be a compelling reason to do so timely. Here are three credits that can make you a disciplined taxpayer rewarded by the agency, along with eligibility criteria:
The Child Tax Credit (CTC) is highly sought after by American taxpayer families. Currently valued at $2,000 per eligible minor, it’s refundable up to $1,600 for those without a tax obligation.
Eligibility criteria include:
Full amounts are qualified for each child if all criteria are met and annual income doesn’t exceed $200,000, or $400,000 for married filing jointly.
Partial credits may be available for higher-income parents and guardians.
Refunds are expected by March 1, though the IRS indicates they might be received even earlier. For claim details, follow this link.
The Earned Income Tax Credit (EITC) also offers significant refunds, ranging from $600 for those without a qualifying dependent to $7,430 for three or more qualifying dependents, varying by applicant situation.
Basic requirements include working and earning less than $63,398, having a valid Social Security number by the 2023 return deadline, including extensions, and having less than $11,000 in investment income in 2023.
More details and requirements can be found at this link. Meeting all criteria could also qualify you for the CTC, significantly increasing minimum refunds.
Taxpayers paying for the care of one or more qualifying persons to work, study full-time, or look for work, and meeting IRS income limits, qualify for the Child and Dependent Care Credit.
Depending on the taxpayer’s income, the IRS offers up to 35% credit on expenses:
In total, you could access $1,050 for one qualifying minor/dependent and $2,100 for two or more as maximum credit. More information is available on the official government website via this link.
Combining maximum amounts from Child and Dependent Care Credit with the CTC and EITC could result in refunds exceeding $11,000 or more, if all requirements are met.
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