January 23 tax season officially started and parents may be eligible to avail of both federal and state tax credits this 2023.
Parents Guide: Up To $14,890 To Earn In Filing Federal And State Tax Credits For This Tax Season (PHOTO: Investopedia)
2023 Tax Season
Raising children is expensive, but at least when it comes to taxes, kids can help downsize the amount you owe. Moreover, this 2023 has several important tax credits you may be eligible for when filing.
Mostly it depends on income, taxpayers claiming children are likely to receive a larger return or a reduced amount owed.
Here Are Some Benefits Parents Should Review
- The earned income tax credit (EITC)
EITC is for eligible parents earning low to moderate income and may reduce the amount of tax that taxpayers owe.
To claim the Earned Income Tax Credit (EITC)
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- Must work and have earned income below $59,187
- Investment income under $10,000 in the 2022 tax year
- Have a valid Social Security number
- Must be a US citizen or a resident immigrant for the whole year
Moreover, you can also check your eligibility, head to the IRS website, and using the EITC Assistant tool.
Those with one qualifying child may claim up to $3,733 in a refundable tax credit. Even though you don’t owe any taxes for 2022, you could still receive $3,733.
- Child Tax Credit (CTC)
CTC helps families with qualifying children will get a tax break and likely reduce the amount of money owed on federal taxes.
Moreover, CTC is worth a maximum of $2,000 per qualifying child. Up to $1,400 is refundable. In 2023, children who are 16 years old and below at the end of the tax year will qualify for the child tax credit.
- Head Of House Status (HOH)
Generally, head of household (HOH) filing status is for unmarried individuals or certain married individuals or RDPs living apart who provide a home for a specified relative. then you could be entitled to HOH. Here are the full eligibility requirements:
- You were unmarried and not in a registered domestic partnership, or you met the requirements to be called unmarried on December 31, 2022.
- You paid more than half the cost of keeping up your home for the year 2022.
- For more than half the year, your house was the main home for you and one of the specified relatives who by law can qualify you for HOH filing status.
For HOH purposes, a qualifying child must be placed with you by an authorized placement agency or ordered by a court to qualify as your foster child.
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