1.12 Tax Credits

1. Overview of Tax Credit

2. Personal Tax Credit

1) Credit for other dependents

$500 for each dependent who is not a qualifying child under age 17.

2) Foreign tax credit <Form 1116>

Computation of allowable credit

3) Child and dependent care credit <Form 2441>

Babysitter, daycare, nursery school (not grammar school) for a child under age 13.

4) American opportunity credit ($2,500 max. per year)

For a student's first four years of post-secondary (college) education
100% of first $2,000 and 25% of the next $2,000 credit, 40% refundable per student (2019)

5) Lifetime learning credit ($2,000 max. per year)

20% of qualified expenses up to $10,000 (2019) at the taxpayer

6) Retirement savings contribution credit

Available for contributions to either a traditional IRA or Roth IRA

7) Elderly and/or permanently disabled credit

$5,000/$7,500 - SS Benefit - 50% (AGI - $5,000/$7,500) x 15%

8) Adoption credit

$14,080 (2019)

9) General business credit (combination)

10) Credit for prior year AMT

3. Refundable Credit

11) Withholding taxes / estimated taxes paid

12) Excess social security taxes withheld

13) Earned income credit (EIC)

14) Child tax credit
$ 2,000 credit for each qualifying child age under 17, refundable up to $1,400