Life Tax Benefits for Having Dependents Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by Ginita Wall Published Jun 7, 2024 3 min read Reviewed by Jotika Teli, CPA Lena Hanna, CPA Even though the dependency exemption was eliminated under the tax reform, there are still some tax benefits you can take advantage of to maximize your tax refund if you have dependents. These tax benefits can significantly reduce or even eliminate your tax liability. Some of the credits discussed are refundable, which means that even if you don’t have any tax liability to offset, you will receive a refund. While we’ll help you to understand the tax benefits of having dependents below, don’t worry about remembering these rules come tax time. TurboTax will ask you simple questions about you and give you the tax deductions and credits you’re eligible for based on your answers. Child Tax Credit: You may be eligible for the Child Tax Credit, which is a tax credit that you get for your dependent kids. It’s even better than a tax deduction because it reduces your taxes dollar-for-dollar. For tax year 2024 (the taxes you file in 2025), the Child Tax Credit is worth up to $2,000 per qualifying child under age 17. You will be eligible for the full credit if your modified adjusted gross income is $400,000 or under for those who are married filing jointly and $200,000 or under for all other filers. For tax year 2024, $1,700 of this credit is refundable, up $100 from tax year 2023. Other Dependent Credit: If you don’t qualify for the Child Tax Credit and your dependent child is over 17 or you support a friend or a relative, you may still be able to claim the Other Dependent Credit of up to $500 per qualifying person. The credit begins to phase out if your adjusted gross income is greater than $200,000 (or $400,000 for married filing joint couples). For tax year 2024, this credit is nonrefundable. Child and Dependent Care Credit: If you pay for childcare, there is a tax credit that you may qualify for at tax time. If you are working or actively seeking work, and you pay childcare for your dependent who is under the age of 13 (no age limit if disabled), you can claim the Child and Dependent Care Credit. Nursery school, private kindergarten, after-school programs, daycare, and even summer and winter day camps are all qualifying expenses. This credit is a dollar-for-dollar reduction of your taxes based on your childcare expenses and is a nonrefundable credit. The expense limit for tax year 2024 is $3,000 for one qualifying individual and $6,000 for two or more qualifying individuals. The percentage used to calculate the credit is up to 35% of expenses, so the maximum credit is up to $1,050 for one qualifying individual or up to $2,100 for two or more qualifying individuals. This credit is reduced for taxpayers with income over $15,000. Earned Income Tax Credit (EITC): There’s a special tax credit available if your wages or self-employment income are below a certain income level. The amount of credit you receive is based on your income, filing status, and how many qualifying kids you have. The refundable tax credit you can receive ranges from a maximum of $7,830 if you have three or more children to $632 if you have no children for tax year 2024. Unlike some other tax credits, the Earned Income Tax Credit is refundable, so if the credit is greater than the tax you owe, you can still receive the difference as a tax refund. No matter what moves you made last year, TurboTax will make them count on your taxes. Whether you want to do your taxes yourself or have a TurboTax expert file for you, we’ll make sure you get every dollar you deserve and your biggest possible refund – guaranteed. Previous Post How to File Taxes in Multiple States After Moving Next Post Happy National Children’s Day! Here’s What Having a Child Means… Written by Ginita Wall More from Ginita Wall 92 responses to “Tax Benefits for Having Dependents” « Older Comments hi i would like to know if my boyfriend is getting money back he earned 52000.00 he is claiming our daughter ..and we pay cash for child care does that counts.. Reply my daughter that is my dependent and full student in college, earned $25 in another state but turbotax wants an extra $50 to file that second state return. Any way that I can do it under the deluxe software I bought to do her federal and state (residence)? Reply I have a question Reply Yes I have 2 kids and me and my boyfriend did our taxes with Jackson Hewitt and we didn’t even get back a $1000 how is that right? When last year my boyfriend got back $1500 for just him and our son Jackson Hewitt said it’s because my boyfriend didn’t have health insurance I feel like they made a mistake when we have 2 kids I really do cause my sister has 2 kids and she’s getting back alot and so is my boyfriend step brother and they both have to kids Reply Thats strange. the penalty for not having health insurance was removed last year. Reply Hi Jenny, The penalty removal for not having health insurance does not take effect until the 2019 Tax Year filing (the Tax Returns filed in 2020) For Tax Year 2018 (the Tax Returns filed in 2019): The penalty for a person or family without health insurance is: Per adult-$695 and $347.50 per child Or Maximum of $2085 per family or 2.5% of your family income (whichever is higher) Thank you My daughter is 17 years old. I want to know do I still get the earned credit as a single working mom? Reply I have question im going go start this new job and making count, I would be making atleast 41K over the year but I’m a family of 4, 3 kids and myself. And I was wondering if When its time to file for taxes there would be an issue since im passing the 37K because i have read that for a family of 4 you should atleast make 37K? Helpp!? Reply I worked one week, and have two children and I was a FT student for 3 months. Why is my tax return only showing $535? Reply If u didn’t want to claim jointly what’s the other options Reply Hi, I live with my boyfriend and we have 1 child together and I have an older child (full custody). For the last couple of years, he claims our child and I claim my older child. I always thought that that was the best way to get the most credit back. If I claimed both kids this year (I made more money than my bf) would this be more beneficial? I have paid $8,760 in childcare this year. I would also qualify for medicaid if I claimed both kids. I can’t afford the “affordable healthcare” because we pay $730 a month for daycare, My boyfriend thinks we would get more back if we claim the kids separately. Reply My son is 18 years old still in school and disable. Do I qualify for eic.. Reply Hi, My kids and wife arrived in USA April 2017. I sent tax return with W7 forms to get dependent benefit. I Received ITIN numbers for my two kids and wife. But i did not receive any dependent benefit. Is it possible to claim kids after Federal tax return. Reply Why is it that for federal tax filing purposes, my 17 year old is no longer considered to be a dependent but for FAFSA, he’s a dependent until age 26? Can the federal government please make up their minds???!!! Reply Thank you for sharing this information. This is very helpful for those who are incoming dependents to the family and this will reflect to your total savings. Get an arrangement of your tax credits and maximize your fund refund. Reply I would like to know approximately how much I would be getting back with three dependents. I have a 6 and 5 yr. old daughter and my husband who is a stay at home dad. Thank you Reply Hi Astrid, It depends how much money you earned and how much you had withheld from your taxes. I can tell you you will get dependent exemptions of $4,050 for each dependent and a $4,050 personal exemption for you and you husband. You also will get the child tax credit worth $1,000 per dependent, and you may be eligible for the earned income tax credit. Thank you, Lisa Greene-Lewis Reply My baby was born in January, year 2017 can I still claim her on my 2016 taxes? Reply Hi, Congratulations! In order to claim your baby for 2016 she would have to be born by December 31, 2016. You can claim her on your 2017 taxes. Make sure she has a valid social security number so you can claim her and also get the tax deductions and credits you are eligible for. TurboTax will ask you simple questions about you and give you the tax deductions and credits you deserve based on your answers. Thank you, Lisa Greene-Lewis Reply Hello, I was wondering if you can tell me an estimate of how much do I get back per dependent one is 10 and the other one is 15 and 16 Reply Hi Erika — There is no way to tell you how much you get back per dependent since your refund depends on so many other factors: your marital status, income, deductions, child care expenses, etc. You can begin your return with TurboTax. As you begin to enter your information you will begin to see the amount of your refund or how much you owe. Be aware that this amount will change as you enter more items. Begin your online return here: https://turbotax.intuit.com/ Reply My daughter was born October 4th 2015, will I be able to claim her? Reply Hi Courtney, Yes, even if she was born on December 31 she can be claimed as your dependent. Make sure you have her social security number when you file so you can get the tax deductions and credits for dependents. Thank you, Lisa Greene-Lewis Reply « Older Comments Leave a ReplyCancel reply Browse Related Articles Family What Is a Dependent? An Introductory Guide to Dependent… Family Child Tax Benefits: How Parents Can Save on Taxes Tax Deductions and Credits Tax Credits and Deductions for Families Tax Deductions and Credits Multigenerational Families: Top Family Tax Deductions a… Tax Deductions and Credits Family Taxes: Take Advantage of Tax Savings Tax Planning 8 Last Minute Tax Tips to Make the Tax Extension Deadli… Family Can I Claim My Parent as a Dependent? Tax Deductions and Credits What is a Refundable Tax Credit? Tax Deductions and Credits 12 Ways to Save on Taxes Through Life’s Transitions Tax Tips Tax Credits 101: What They Are & How They Work
hi i would like to know if my boyfriend is getting money back he earned 52000.00 he is claiming our daughter ..and we pay cash for child care does that counts.. Reply
my daughter that is my dependent and full student in college, earned $25 in another state but turbotax wants an extra $50 to file that second state return. Any way that I can do it under the deluxe software I bought to do her federal and state (residence)? Reply
Yes I have 2 kids and me and my boyfriend did our taxes with Jackson Hewitt and we didn’t even get back a $1000 how is that right? When last year my boyfriend got back $1500 for just him and our son Jackson Hewitt said it’s because my boyfriend didn’t have health insurance I feel like they made a mistake when we have 2 kids I really do cause my sister has 2 kids and she’s getting back alot and so is my boyfriend step brother and they both have to kids Reply
Hi Jenny, The penalty removal for not having health insurance does not take effect until the 2019 Tax Year filing (the Tax Returns filed in 2020) For Tax Year 2018 (the Tax Returns filed in 2019): The penalty for a person or family without health insurance is: Per adult-$695 and $347.50 per child Or Maximum of $2085 per family or 2.5% of your family income (whichever is higher) Thank you
My daughter is 17 years old. I want to know do I still get the earned credit as a single working mom? Reply
I have question im going go start this new job and making count, I would be making atleast 41K over the year but I’m a family of 4, 3 kids and myself. And I was wondering if When its time to file for taxes there would be an issue since im passing the 37K because i have read that for a family of 4 you should atleast make 37K? Helpp!? Reply
I worked one week, and have two children and I was a FT student for 3 months. Why is my tax return only showing $535? Reply
Hi, I live with my boyfriend and we have 1 child together and I have an older child (full custody). For the last couple of years, he claims our child and I claim my older child. I always thought that that was the best way to get the most credit back. If I claimed both kids this year (I made more money than my bf) would this be more beneficial? I have paid $8,760 in childcare this year. I would also qualify for medicaid if I claimed both kids. I can’t afford the “affordable healthcare” because we pay $730 a month for daycare, My boyfriend thinks we would get more back if we claim the kids separately. Reply
Hi, My kids and wife arrived in USA April 2017. I sent tax return with W7 forms to get dependent benefit. I Received ITIN numbers for my two kids and wife. But i did not receive any dependent benefit. Is it possible to claim kids after Federal tax return. Reply
Why is it that for federal tax filing purposes, my 17 year old is no longer considered to be a dependent but for FAFSA, he’s a dependent until age 26? Can the federal government please make up their minds???!!! Reply
Thank you for sharing this information. This is very helpful for those who are incoming dependents to the family and this will reflect to your total savings. Get an arrangement of your tax credits and maximize your fund refund. Reply
I would like to know approximately how much I would be getting back with three dependents. I have a 6 and 5 yr. old daughter and my husband who is a stay at home dad. Thank you Reply
Hi Astrid, It depends how much money you earned and how much you had withheld from your taxes. I can tell you you will get dependent exemptions of $4,050 for each dependent and a $4,050 personal exemption for you and you husband. You also will get the child tax credit worth $1,000 per dependent, and you may be eligible for the earned income tax credit. Thank you, Lisa Greene-Lewis Reply
Hi, Congratulations! In order to claim your baby for 2016 she would have to be born by December 31, 2016. You can claim her on your 2017 taxes. Make sure she has a valid social security number so you can claim her and also get the tax deductions and credits you are eligible for. TurboTax will ask you simple questions about you and give you the tax deductions and credits you deserve based on your answers. Thank you, Lisa Greene-Lewis Reply
Hello, I was wondering if you can tell me an estimate of how much do I get back per dependent one is 10 and the other one is 15 and 16 Reply
Hi Erika — There is no way to tell you how much you get back per dependent since your refund depends on so many other factors: your marital status, income, deductions, child care expenses, etc. You can begin your return with TurboTax. As you begin to enter your information you will begin to see the amount of your refund or how much you owe. Be aware that this amount will change as you enter more items. Begin your online return here: https://turbotax.intuit.com/ Reply
Hi Courtney, Yes, even if she was born on December 31 she can be claimed as your dependent. Make sure you have her social security number when you file so you can get the tax deductions and credits for dependents. Thank you, Lisa Greene-Lewis Reply