If you have biological children or other dependents under
your care, you deserve to be rewarded for all your hard work.
Fortunately, the IRS sees it that way too, which is why
there are several benefits and credits available to those with dependents in
their care.
The Child Tax Credit
Do you have a child under the age of 17? If you answered
“yes” to that question and your income is not above $400,000 (for those who are
married and filing jointly), then you are eligible for the Child Tax Credit.
This credit reduces your taxes to the tune of $2,000 and is
very easy to apply to your tax forms. Either do it yourself or ask an
accountant to help you get this awesome credit.
The Earned Income Tax
Credit
While not everyone is eligible for the earned income tax
credit, it’s a wonderful benefit for those who are eligible.
Those with three or more children who earn no more than
$49,194 (if filing as single) and no more than $54,884 (if married filing
jointly) qualify.
The same is true for those with two children and who earn no
more than $45,802 (if filing as single) and no more than $51,492 (if married
filing jointly).
To qualify with one child, you’ll need to make no more than
$40,320 (if filing as single) and no more than $40,010 (if married filing
jointly).
If you do qualify, you can get money back thanks to the
refundable nature of this tax credit.
Other Credits and
Deductions
These are not the only ways to save on taxes for caregivers.
In some cases, you can enjoy credits and deductions related to school tuition
costs, childcare costs, and more. Every situation is different, though, so work
with an accountant to learn about all of the benefits available to you and to
ensure you take advantage of all of the options for which you are eligible.
