3 Great Tax Credits for Parents and FamiliesUpdated March 4, 2016 Tax Credits
To help ease the burden of raising a family and taking care of children or elderly or disabled family members, on top of the child tax credit, taxpayers may be eligible for relief with three important tax credits.
Child and Dependent Care Tax Credit – Unless you have a family member who can watch your children while you go to work, one of the biggest costs for families remains child care. Even part-time care for kids after school can run hundreds of dollars a month, and for younger children requiring full-time care, the financial strains can be a significant burden.
To help families defray costs, the Child and Dependent Care Credit can ease these burdens. To take advantage of this tax credit:
Check Your Eligibility
- You must be able to show you have earned income for the year you are filing for. If you are married, your spouse must also be able to show they earned income as well.
- You must show that you paid someone to take care of a qualifying person. The care provider must not be one of your own dependents, your spouse or one of your own children under 19 years old.
- You can be exempt from the income requirement if you show that you were disabled or you were a full-time student.
Depending on your income, you can get back as much as 35 percent of the dependent care expenses you paid.
Adoption Tax Credit – To offset the costs of expenses associated with adopting a child, the Adoption Tax Credit is available to families who adopt a child under 18 or a child of any age who is not able to take care of themselves.
Adoption expenses can include attorney’s fees, travel expenses, adoption fees and any others that can be directly attributed to the adoption process. The child must be a United States citizen to take advantage of this credit. The credit can be taken whether the adoption originated either domestically or with a foreign born child. For 2015, $13,400 is the maximum credit allowed per child.
Senior and Disability Tax Credit – Certain people can qualify for tax credits when they turn 65 or if they are under 65 years old, but permanently and totally disabled. Strict income guidelines apply in these cases, and for the credit to be valid, the person must prove that a physical or mental condition has lasted at least 12 months or that the condition may result in death.