Budgets and Money

Tax Credits for Families

Leaving eligible tax credits on the table can have a direct effect on your family's taxable income, so it's important to stay abreast on changing taxes and credits during income tax season.

Family Budgeting Advice for Tax Time

Just about every family is on some type of budget. Which is why you don't want to leave any eligible tax credit that the Internal Revenue Service has available to you sitting on the table.

So whether you hire a tax professional every year, or complete your income taxes yourself, it's important to stay informed about specific tax changes and credits that may have a direct effect on your family's taxable income.

  • Earned Income Tax Credit (EITC)

  • This is a refundable tax credit for low to moderate income individuals and couples-particularly those with children. The amount of EITC benefit depends on a recipient's income and number of children. The maximum EITC amount in 2015 is $3,359 for taxpayers filing jointly with one child; $5,548 for two children; $6,242 for three or more children (up from $6,143 in 2014), and $503 for no children.1

  • Child & Dependent Care Credit

  • The child and dependent care credit is meant to help offset some of the costs that you've paid put for the care of your child, a dependent, or a spouse. For 2015, the value used to determine the amount of credit that may be refundable is $3,000.2

  • Kiddie Tax

  • For 2015, the threshold for the kiddie tax - meaning the amount of unearned net income that a child can take home without having to file a federal tax return is $2,100.3

  • Adoption Credit

  • If you had adoption-related expense, there are credits and exclusions that may substantially reduce your tax liability. According to the IRS, “The adoption tax credit offsets qualified adoption expenses, making adoption possible for some families who could not otherwise afford it.” In 2014, the maximum adoption tax credit allowable is $13,190. In 2015, the maximum credit is set at $13,400.4

With the Internal Revenue Service rolling our more than 40 new tax provisions every year, don't wait until April 15th to review what tax credits you may have coming to you, as well as phase-outs and thresholds that may have changed since last year.

1. http://www.irs.gov/Credits-&-Deductions/Individuals/Earned-Income-Tax-Credit
2. http://www.irs.gov/taxtopics/tc602.html
3. http://www.irs.gov/taxtopics/tc553.html
4. http://www.irs.gov/taxtopics/tc607.html

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Family Budgeting

Family budgeting is always a challenge. So why not take advantage of some of the IRS's family related tax credits and provisions? What you may be able to save come tax time will make you and your budget happy. Learn more about tax changes and credits to better help you with your family budget. For more information, visit our learning center.