Tax deductions for the year 2022 will look different than they did for 2021 as the American Rescue Plan brings an end to many of its programs.
If you use TurboTax, it will remind you of which credits are being reverted or ending entirely for your tax return with the IRS.
According to My Twin Tiers, there are various credits ending or changing from the 2021 tax season to the 2022 tax season.
The Child Tax Credit
In 2021 the child tax credit gave filers up to $3,600 for each dependent under the age of 6. For each child between the ages of 6 and 17, they received up to $3,000. If a child was 17 they could be claimed. Filers got the full credit if they made under $75,000 as single filers, $112,500 as HOH filers, or $150,000 as married filing jointly. The credit was fully refundable even if you did not owe income taxes.
In 2022 to get the credit, the child must be under the age of 17, they cannot be 17. Each child can get up to $2,000. Full credits are available to filers who make under $200,000 single or $400,000 married. It’s partially refundable, so you’ll only get $1,400 if you did not owe any taxes.
Child and Dependent Care Credit
In 2021, filers could get 50% on $8,000 in child care expenses for those under age 13. The same was true for an incapacitated parent or spouse the filer was paying for. If there were two or more dependents, that number rose to $16,000. This means parents with more than one could see up to $8,000 in refundable tax credit. Once your AGI hit more than $125,000, that amount decreased.
In 2022, filers can only see up to 35% of a maximum of $3,000 claimed for childcare expenses for children under 13 or incapacitated spouses or parents. For two or more dependents the amount is $6,000. If your AGI is over $15,000, the amount decreases.
Earned Income Tax Credit
In 2021, those claiming the EITC could claim it even if they did not have children. Those without children that were over the age of 65 or between the ages of 19 and 25 were eligible. The maximum amount for three or more kids was $6,728.
In 2022, filers without kids have to be at least 25 or under age 65 to qualify. The previous year’s income cannot be used to qualify. The amount will be boosted to $6,935 for 3 or more children.
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