$1,000 to $2,000 and is now also available, in full, to more people. The entire credit can be claimed by single parents who make up to $200,000, and married couples who make up to $400,000. This is another example of how we could decrease our tax liability to the government.
Remember standard deductions from the tip above? This is somewhat different in regards to how it works for you. A tax credit broken down essentially is “x” amount of money that will be deducted AFTER your taxable income has been taxed. Further meaning what you owe to Uncle Sam will now be “amount owed” – “child care credit” = new amount which sometimes results in what we all love a bigger tax refund. This can also prove to be a way to get the biggest bang for our buck and keep money in our pockets.
Traditionally, black families procreate at higher rates compared to our counterparts. With this credit now being doubled mothers and fathers now have an opportunity to keep a few extra dollars in their pockets.
I know that got a little conceptual based, but hopefully, it shed light on standard deductions vs tax credit. If you want me to go more in-depth drop a comment below and we can explore further together.
3. There is a new temporary credit for non-child deductions, like elderly adults.
We’ve all heard the phrase growing up “it takes a village.” This concept of “community” is one that black households hold near and dear. Traditionally and historically black children are