01/30/2025

IRS Releases Updates Related to Tax Season

Here's the agency's latest outreach

The official start of the filing season is here - Jan. 27, 2025. The Internal Revenue Service (IRS) would like to reach out to America’s families this filing season to make certain that eligible families are claiming their tax credits when including dependents on their tax returns.

Child Tax Credit (CTC): The CTC is a credit that may reduce your tax by as much as $2,000 for each child who qualifies you for the credit. To qualify, the child must be a U.S. citizen under age 17; have a Social Security number; be claimed as a dependent on the taxpayer's tax return; and more. Use the IRS Interactive Tax Assistant tool to determine eligibility: Does my child/dependent qualify for the child tax credit or the credit for other dependents?.  For more information please see: Child Tax Credit.

Other Dependent Credit (ODC): The ODC is a credit that may reduce your tax by as much as $500 for each eligible dependent. The person is claimed as a dependent on your return; the person can’t be used by you to claim the CTC or Additional CTC; the person was a U.S. citizen, U.S. national, or U.S. resident alien. Again, use the IRS Interactive Tax Assistant tool to determine eligibility: Does my child/dependent qualify for the child tax credit or the credit for other dependents?.

Earned Income Tax Credit (EITC): One refundable tax credit for moderate- and low-income families is the Earned Income Tax Credit. The IRS estimates there are millions of workers who qualify but don't claim the EITC - missing out on thousands of dollars every year. The EITC is as much as $4,213 when claiming one child, $6,960 when claiming two children and $7,830 when claiming three or more children. Use the EITC Assistant to learn if you're eligible for the tax credit. For more detailed information see: Publication 596, Earned Income Credit and Who Qualifies for the Earned Income Tax Credit (EITC).

Child and Dependent Care Credit: Taxpayers who paid someone to care for their child, spouse or dependent so they can work, be a full-time student or look for work may be able to reduce their tax by claiming the Child and Dependent Care Credit. The total expenses that you may use to calculate the credit may not be more than $3,000(for one qualifying individual) or $6,000 (for two or more qualifying individuals). Use the IRS Interactive Tax Assistant tool: Am I Eligible to Claim the Child and Dependent Care Credit? For more information please see: Publication 503, Child and Dependent Care Expenses or Topic no. 602, Child and Dependent Care Credit

American Opportunity Tax Credit (AOTC): The AOTC is a credit that may reduce your tax by as much as $2,500 for each eligible student on your tax return. The AOTC can be claimed for yourself, your spouse, or a dependent claimed on your return.  See Publication 970, Tax Benefits for Education, or use the IRS Interactive Tax Assistant tool "Am I Eligible to Claim an Education Credit?" to help you determine if your education expenses qualify for a tax benefit.

Note: The actual credit amounts will be determined by a taxpayer’s Adjusted Gross Income.