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Category: Credits

Please explain all of the credits that are available related to me and my family.

Child and Dependent Care Costs:

If you paid someone to care for your child who is under age 13 (such as daycare), you may be able to reduce your tax by claiming the Credit for Child and Dependent Care Expenses.


You can also claim this credit if you paid for someone to care for a disabled spouse or dependent who lived with you more than half of the year. Please review this link for more information: Publication 503.


Earned Income Credit:

The Earned Income Credit (EIC) is a tax credit for certain people who work and have low wages. We will automatically calculate the amount of your EIC if you are eligible.


However, if you have previously been disallowed from receiving EIC, but want to claim it on your return this year, you are required to fill out Form 8862 . If you would like more information in regards to the Earned Income Credit, please review Publication 596.


Adoption Expenses:

If you adopted, or attempted to adopt, an eligible child (including any disabled person or a foreign child) you may be able to take a tax credit for any qualifying expenses that you paid. An eligible child is any child under age 18. If the child turned 18 during the year, the child is an eligible child for the part of the year he or she was under age 18.


Qualifying Adoption Expenses include:

* Adoption Fees

* Attorney Fees

* Court Costs

* Travel expenses (including meals and lodging) while away from home, and

* Re-adoption expenses relating to the adoption of a foreign child


Qualifying Adoption Expenses do not include expenses:

* For which you received funds under any state, local, or federal program

* That violate state or federal law,

* For carrying out a surrogate parenting arrangement,

* Paid or reimbursed by your employer or any other person or organization, or

* Allowed as a credit or deduction under any other provision of federal income tax law


To claim this credit, the adoption generally must have become final. There are a few exceptions dependent on the type of adoption (Domestic or Foreign). For more information, please review the 8839 Instructions.