Tax Deduction Baby!

April 3, 2007

I started working on our family’s tax return last night and answered yes to the question in Turbo Tax about dependents for the first time.

Of course, our son is more than just a tax deduction to us, he’s also a good excuse to leave work early!

Just kidding, being a parent is a wonderful, life-changing experience and we’ve had a ball watching him grow and learn. His smile just makes our day. The tax deduction is just another thing to smile about Here is what Turbo Tax had to say about the child tax credit:

“A child tax credit is available only to taypayers with at least one qualifying child. The maximum credit is $1,000 per qualifying child. If you have more than $11,300 of earned income, or you have three or more qualifying children, and you are not able to claim the full $1,000 child tax credit for each child because of tax liability limitations, you may be able to claim the child tax credit as a partially refundable credit that will reduce your tax liability or increase your refund.”

All I know is that we now have a “qualifying child”. I’ll punch in the numbers and let Turbo Tax figure out the rest.

[photo credit annieseay]

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Ben

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Ben
Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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Comments

7 Responses to Tax Deduction Baby!

  • Eric

    You’re looking to save some money, so your going to have a kid?! Buddy, your tax savings will be very small percentage of what you’ll be spending on your child. My wife and I just had twin girls. I’m glad for the tax credit, but it will no way pay for all the expenses. By the way, does anyone know where I can get a 5 gallon bucket of Similac Formula Powder??

  • KMC

    I’m more than a little embarrassed to say I cared that my daughter was born in December. I could deduct her for the year even though we only had her for a month. Baby number two is due in October; another deduction…I mean bundle of joy.

  • Ben

    limeade, I agree, you shouldn’t have kids just to get a tax deduction but it does help out after you spend all your money on diapers!

  • limeade

    We’re considering having kids at some point. I wouldn’t say the tax deduction makes me want to any sooner, but it is good to know it’s there.

    -limeade
    http://fiscalmusings.blogspot.com

  • John

    With our first on the way in a matter of weeks, these are some of this things that weigh on my mind. Very nice, good luck!

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