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5 Tax Credits and Deductions for Every Income Level
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Tax breaks aren’t reserved for rich people only. There are many tax credits and deductions available across income levels, whether you’re making $35,000 or $350,000. With tax season in full swing, here are five tax credits and deductions that can help maximize your tax savings or your refund, regardless of your income bracket. Check Out: 5 Tax Loopholes the Ultra-Wealthy Use That Most Americans Don’t Know About For You: 5 Low-Effort Ways To Make Passive Income (You Can Start This Week) The Child Tax Credit (CTC) is a non-refundable credit that allows people with a qualifying child to reduce their tax liability. Eligible taxpayers can claim a credit for each qualifying child under age 17, per the IRS. Though there are income limits that determine how much of the credit you can get, many middle- and higher-income households still qualify for at least a partial credit. And since a portion of the credit may be refundable, you could receive money back even if you don’t owe taxes. So if you have dependents, definitely look into this tax credit. See Next: Here’s the Minimum Income You Need To File Taxes in 2026 — by Age If you pay for childcare so you can work or look for work, you may qualify for the Child and Dependent Care Credit. This credit covers a percentage of qualifying care expenses, including daycare, preschool, summer day camps and even some in-home care services, according to the IRS. Though the percentage you can claim decreases as your income goes up, the credit is still available across a wide range of income levels. Though income limits apply, many middle- and even some higher-income taxpayers can still qualify for the American Opportunity Credit and Lifetime Learning Credit. The lifetime learning credit and the American opportunity credit modified adjusted gross income limits are $180,000 if you’re married filing jointly ($90,000 if you’re filing single, head of household or qualifying surviving spouse), per the IRS. You can get a maximum annual credit of $2,500 per eligible student. If the credit brings the amount of tax you owe to zero, you can have 40% of any remaining amount of the credit (up to $1,000) refunded to you. The Lifetime Learning Credit is broader and can be used for graduate school, professional courses or skill-building classes, per the IRS. You may be able to claim a deduction on your individual federal income tax return for the amount you contributed to your traditional IRA. This deduction is available to many taxpayers, though income limits apply if you or your spouse is covered by a workplace retirement plan. There’s also the Saver’s Credit, which is designed to reward retirement contributions. Though it mainly benefits low- to middle-income earners, higher earners can still benefit from the deduction side of retirement contributions through IRAs or Health Savings Accounts. Donating to qualified charities can also reduce your taxable income. If you itemize deductions, you can write off cash donations, property donations and mileage driven for charitable work. Generally, you may deduct up to 50% of your adjusted gross income, but 20% and 30% limitations apply in some cases, according to the IRS. More From GoBankingRates 5 Tax Loopholes the Ultra-Wealthy Use That Most Americans Don't Know About I'm an Accountant: 6 'Big Beautiful Bill' Tax Changes That Will Benefit the Middle Class 6 Safe Accounts Proven to Grow Your Money Up to 13x Faster How Much Money Is Needed To Be Considered Middle Class in Your State? This article originally appeared on GOBankingRates.com: 5 Tax Credits and Deductions for Every Income Level