It’s time to be financially prepared because, this year, tax returns will be slimmer than usual. Why is this the case?
Previously, the child tax credit allowed us to claim up to $3,600 per child under the age of six and $3,000 per child between the ages of 6 and 17. This year that amount decreases to $2000 per child under 17. But that’s not the only change.
The earned income tax credit (EITC) allowed workers without kids to triple the maximum credit in previous years. The age range also included people as young as 19. This year, taxpayers without children must be at least 25 and under 65 to claim the credit.
The other significant change is to the child and dependent child care credit. This tax year, we are only getting up to 35% of $3,000 ($1,050) for childcare expenses for children under the age of 13.
This year's tax changes remind us of one thing: The government cares most about our finances when it benefits the economy. It isn’t concerned about our wealth or financial well-being.