Thinking about playing (or suing) the lottery to foot your childcare bills? 😵💫🎰 We don't blame you. The cost of childcare is rising all across the country, putting a bigger burden on families already struggling with their finances. 👨👩👧👦
Pennsylvania made a key change to a tax credit that could help put some cash back into the family budget. 💵 We've got the details on how it works and how to claim it.
Here’s Five Fast Facts on the Pennsylvania Child and Dependent Care Tax Credit:
- 🙇🏻♀️ Cash for the Kids - PA created the Child and Dependent Care Tax Credit to help working families recoup some cash from childcare expenses. The credit was originally for 30% of childcare costs, but it's now 100%.
- 💸 Extra Credit - Households with two or more children are entitled to a credit of up to $2,100. Households with one child could receive up to $1,050. As your income levels increase, the amount of the tax credit you'll get is phased down. The minimum credit is $600 (one child/dependent) or $1,200 (two or more children/dependents). Note: your childcare expenses must be at least $3,000 per child or dependent annually.
- 👛 Help Wanted - Access to affordable childcare is a must all across the Keystone state. In Philadelphia, the current poverty rate is 25%. Statewide, the poverty rate is just above 12%.
- 🤗 The More, The Merrier - This tax credit also applies to care costs for spouses or dependent individuals who are physically and mentally incapable of self care, as long as they've lived with you for more than half the year.
- 📋 The Fine Print - To get more information on eligibility requirements and how to claim the credit, head to the PA Department of Revenue website.
🔥Bottom line: Like we always say, if Uncle Sam's handing it out, go ahead and take it! If you've been saving for retirement, there's a tax credit for that, too. Head here to learn more about the Saver's Tax Credit and if you're eligible.
Will you be taking advantage of this tax credit?
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