In case you haven’t heard, a new $760 billion tax deal was signed into existence at the end of 2015. It doesn’t mean everyone is going to get a giant tax refund, but for a few key groups this is a major change that will alter their lives for the better.
We’re going to go through the big beneficiaries.
Bigger Refunds for Having Kids
The child tax credit is refundable, so you can claim regardless of your tax situation. The refunded amount is 15% of any earned income above $3,000. This was set to expire in 2017, but it’s now permanent.
Tuition Tax Credits
The Hope Scholarship Credit has helped many students deal with the costs of higher education. This new tax credit has made the renamed America Opportunity Tax Credit a permanent addition. You have the chance to claim $2,500 per year in tax credits for education expenses.
More Money for Low Income Families
The Earned Income Tax Credit is a mechanism to deal with poverty. It’s become more generous in recent years, but it was set to expire in 2017. This has changed and it’s been renewed. The maximum credit families can claim is now 45% of household income, which is up from 40%.
The threshold for when this credit starts to be reduced due to household income has also been increased.
These are the big tax changes that occurred 2015. If you fall into any of these groups, these changes could well translate to thousands of extra dollars in your household accounts.
Image credit: GotCredit