The income limits for various tax credits and deductions in the United States can vary depending on the specific credit or deduction in question, as well as the tax year. Here’s an overview of some key tax credits and deductions with their income limits based on the information available:
Earned Income Tax Credit (EITC):
For 2024, to claim the EITC, your modified adjusted gross income (MAGI) must not exceed $66,819 if you are married filing jointly, or $59,899 if you are filing as single, head of household, or qualifying surviving spouse. The maximum credit amount can be up to $7,830, depending on the number of qualifying children you have.
Child Tax Credit (CTC):
For the 2024 tax year, you’re eligible for the full credit if your MAGI is $400,000 or below for married filing jointly, or $200,000 or below for all other filers. The credit amount per child can be up to $2,000, with $1,700 of that potentially refundable. The credit begins to phase out above these income levels, reducing by $50 for each $1,000 of income above the threshold until it phases out completely.
American Opportunity Tax Credit (AOTC):
For tax year 2024, you can claim the full AOTC if your MAGI is $80,000 or less ($160,000 or less for married filing jointly). The credit is reduced if your MAGI is over $80,000 but less than $90,000 (over $160,000 but less than $180,000 for joint filers), and you cannot claim it if your MAGI is over $90,000 ($180,000 for joint filers). The credit can reduce your tax liability by up to $2,500 per eligible student for the first four years of higher education.
Lifetime Learning Credit (LLC):
The income limits for the LLC for 2024 are $90,000 for single filers and $180,000 for joint filers. The credit provides up to $2,000 for qualified education expenses.
Student Loan Interest Deduction:
You can deduct up to $2,500 in student loan interest for 2024, provided your MAGI is less than $80,000 for single filers or $170,000 for married couples filing jointly. This deduction phases out completely at $90,000 for singles and $185,000 for joint filers.
Adoption Credit:
For the 2024 tax year, the maximum credit for adoption expenses is $16,810, but this credit begins to phase out for taxpayers with a MAGI of $292,150 or more.
Saver’s Credit:
This credit is for contributions to retirement accounts. For 2024, you can claim this credit if your MAGI is below $36,500 for single filers, $54,750 for heads of household, or $73,000 for married filing jointly. The credit is worth up to 50% of your contribution, with a maximum credit of $1,000 for single filers or $2,000 for joint filers.
Premium Tax Credit:
This credit helps with health insurance costs through the Health Insurance Marketplace. For eligibility in 2024, your household income must be within certain ranges, but specific figures for the year are not detailed in the provided information. However, if you or your spouse received unemployment compensation in 2021, your household income is considered to fall within this range.
For all these credits and deductions, it’s crucial to check the specific rules for each as they can change from year to year, and individual circumstances can impact eligibility. Contact the firm today to discuss your situation.