Dependent Tax Deductions and Credits You Need to Look into Come Tax TimeMarch 4, 2023
Come tax time, you need to claim all tax deductions and credits you qualify for. Here are dependent tax credits and deductions you can claim.
Tax deductions and credits can help you pay a less tax bill or even get a huge tax refund from the IRS come tax season. Therefore, you need to take advantage of all tax deductions and credits you are qualified for. A huge population of tax payers forget or are not aware they can claim dependent tax deductions and credits. Here is a detailed discussion of these tax deductions and credits, and how you can easily claim them come tax time.
Dependent Tax Deductions and Credits You Can Claim
Child Tax Credit
This is a common dependent tax credit available to parents or guardians, but many tax payers don’t claim it. If you have a qualifying child or children, you can get $2,000 per eligible child. Qualifying children must be under the age of 17 years, and you must have lived and supported them for at least half of the tax year.
Earned Income Tax Credit (EITC)
The US government eases tax bill for low to moderate income earning families by offering them Earned Income Tax Credit. The tax credit is to help the families live a better life. The tax credit amount depends on the family’s income, filing status and the number of little ones in the family. A family with three or more eligible children can get up to $6,660, while a family with one qualifying child can get up to $3,584. In addition, if you have a family with two qualifying little angels, you can get up to $5,920.
Child and Dependent Care Tax Credit
This tax credit is mostly for parents or guardians who pay for cost of taking care of a child or a dependent so that they can have time to work, look for work or study. This credit is not utilized by many tax payers, but if you closely look at it and qualify for it, you can save big when paying your taxes. The credit is non-refundable, but can help reduce your tax bill.
Other Dependent Tax Deductions and Credits
The IRS is very generous to tax payers that support children and dependents; either studying or disabled. It does so through other tax credits and deductions tax payers can claim when filing their tax returns. Some of the dependent tax deductions and credits you need to look into include American Opportunity Credit, Lifetime Earning Credit, Student Loan Interest Tax Deduction, and Adoption Tax Credit.
How to Easily Claim These Deductions and Credits?
Before you even think of how to claim a dependent tax credit, It’s essential to find out which tax deductions and credits you qualify for. The easiest way is to use online tax filing software like TurboTax or H&R Block. You just need to provide necessary information and answer a few questions, and the software will outline all the dependent tax credits and deductions you qualify for. From there, the tax filing software will file tax returns for you, claiming all the tax deductions and credits you are eligible for. The process is very accurate, easy, and fast.