A piece of news that has been applauded by millions of citizens in the United States comes from the Social Security Administration, which has made an important gesture in collaboration with the IRS. The reason is a key benefit that many still don't know about and can help significantly reduce families' tax burden.
This credit is designed to help those who have to pay for the care of children under 13 years old or dependents, such as elderly adults or family members with disabilities. If you meet certain requirements, you'll receive between 20% and 35% of the money you've spent on this care, a significant savings when filing your tax return.
Discover this key IRS tax credit: who can apply
The maximum amounts that can be claimed are $3,000 if you care for one person or up to $6,000 if there are two or more. This can represent a vital benefit for many families who have no other option but to pay for daycare, caregivers, or day programs. Social Security considers it a key resource to ease the financial pressure on those who need it most.
In addition, you can also apply if you care for a spouse or family member who can't care for themselves and who has lived with you for more than half the year. To receive the benefit, you must have worked or be actively looking for work, since it's considered support for those who work and have dependents.
Apply this easily: keep these details in mind
One of the most valued aspects is that this benefit isn't refundable, but it can directly reduce the amount you owe to the IRS. That's why reducing the tax burden becomes a great relief for many workers in the United States.
How to apply is very simple; you just need to include Form 2441 when you file your federal tax return. In that document, you detail the expenses you've incurred for the care of your children or dependents. It's important to keep receipts or proof of payment and the information of the care service provider.
Parents can keep working while caring for their loved ones
SSA, by promoting this information along with the IRS, wants to make sure no family misses this opportunity. With inflation and the high cost of living in many areas of the country, these types of tax advantages become more than necessary.
The Child and Dependent Care Tax Credit is an effective tool to improve quality of life. In addition, it allows parents to keep working while caring for their loved ones.
All in all, knowing that Social Security and the IRS keep your most basic needs in mind is good news. If you haven't applied yet, this may be the perfect time to do so and make the most of this vital benefit.