Taxpayers who requested an extension of time to file their federal tax returns have until Oct.16 to double-check their returns for tax benefits that people often overlook. These taxpayers still have time to see if they can benefit from these four credits.
Earned Income Tax Credit
The Earned Income Tax Credit – also known as EITC and EIC – benefits people who work and who have low-to-moderate incomes. This credit reduces the amount of tax owed and may result in a refund. To qualify for this credit, a person must meet certain requirements. They must also file a tax return.
Child Tax Credit
This is a credit of up to $1,000 per qualifying child. Taxpayers who claim this credit – but who do not qualify for the full amount – may also be able to take the additional child tax credit.
This credit helps low-to-moderate-income workers save for retirement. It is also known as the Retirement Savings Contributions Credit.
American Opportunity Credit
A credit for tuition, enrollment fees, and class material for the first four years of higher education. The amount of this credit is up to $2,500 per eligible student per year.