Other Individual Tax Credits
Prior to the 2010 Tax Relief Act, various tax credits were about to expire or return to reduced levels on December 31, 2010. Due to the 2010 Tax Relief Act, the child tax credit at the current $1,000 level per child will be extended two years. The refundable part of the credit is also extended through the end of 2012. At higher levels, the child and dependent care credit is extended through 2012. The maximum amount of eligible expenses remains at $3,000 for an individual and $6,000 for two or more individuals. The American Opportunity Tax Credit (AOTC), which replaced the Hope education credit in 2009, will also be extended through the end of 2012. Other credits, like the enhanced earned income credit and adoption credit, are also extended at the 2010 levels through the end of 2012.
The Joint Committee on Taxation estimates that the cost of the child tax credit at higher levels will total $71.7 billion, with the refundable portion adding another $19.7 billion. The extension of the child and dependent care tax credit and AOTC’s estimated cost will total $600 million and $17.6 billion, respectively.
If you have any questions or would like more information, please contact Wood, Atter & Wolf, P.A., in Jacksonville and Ponte Vedra Beach, Florida.
