credit—essentially, a more modest
version of the one currently in the
Biden relief plan—that rewards fam-
ilies for simply having children. And
while many of the existing tax breaks
are limited by income, not all of them
are and, where there are restrictions,
the cutoffs are higher than those for
stimulus payments in many cases,
allowing more parents to qualify.
You can’t nab the savings, though,
unless you know the specific deduc-
tions and credits to look for. Here’s a
look at nine of the most generous and
commonly used tax breaks currently
available to parents as you fill out your
return this year.Child Tax Credit
the current child tax credit, last
expanded in 2018 when it doubled in
value, allows parents and other legal
guardians to reduce their tax bill by
up to $2,000 per child under the age
of 17. The best part? The credit is par-
tially refundable, meaning if you don’t
owe any federal taxes, you can receive
as much as $1,400 back as a refund for
each child who qualifies.
If you have dependents who are 17
or 18 years old or who are full-time
college students, between the ages
of 19 and 24, you could also receive
a nonrefundable credit of up to $
per each of these young adults.
The income limits are higher than
for stimulus relief so you can claim
the full credit even if you make up to
$200,000 as a single, or $400,00 if
married filing jointly. Once you pass
those thresholds, the credit begins to
phase out gradually, says Robert Tobey,
a New York-based CPA with Grassi &
Co. Still, most households with kids
qualify: The Tax Policy Center esti-
mates that 90 percent of families with
children received an average Child
Tax Credit of $2,380 in 2020.
In light of the pandemic, the IRS is9 Ways Parents
Can Catch a Break
Have kids under 18? You can cut your tax bill or boost
your refund by hundreds, even thousands,
of dollars this year if you claim these write-offsalong with the prospect of
$1,400 stimulus payments, par-
ents have another reason to cheer
President Joe Biden’s $1.9 trillion
pandemic relief package currently
working its way through Con-
gress: The legislation contains an
expanded tax break specifically for
families that could give most house-
holds $250 to $300 a month for each
child younger than 18. You don’t
have to wait for the plan to becomelaw, though, to nab big tax savings
this year. Existing breaks could cut
your tax bill or boost your refund by
hundreds, even thousands, of dol-
lars—if you know what’s available.
Most of the credits
and deductions cur-
rently in the tax code
focus on helping par-
ents with the cost of
childcare and educa-
tion. But there’s also aYOUR MONEYBYKERRI ANNE
RENZULLI
@kerenzulliPeriscope
16 NEWSWEEK.COM MARCH 12, 2021