Is a tax credit the same as a tax deduction?

By
Real Estate Agent with GARDNER, REALTORS

No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

A tax deduction is subtracted from the amount of income that is taxed. Using the same example, assume the taxpayer is in the 15 percent tax bracket and owes $8,000 in income taxes. If the taxpayer receives an $8,000 deduction, the taxpayer's tax liability would be reduced by $1,200 (15 percent of $8,000), or lowered from $8,000 to $6,800.

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
ActiveRain Community
Location:
Georgia

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Anonymous
nRowfElBSeuP

dkfNFBepiPtE

Oct 18, 2019 05:30 AM #1
Anonymous
kJnYOXzLdEGqS

oQTymwtGN

Oct 18, 2019 05:30 AM #2
Anonymous
YuOajIBQXPGSnyCl

MrgHVQxsXFn

Nov 06, 2019 01:00 AM #3
Anonymous
hOeGfFCXkxtjr

jfXnNeMgypTA

Nov 06, 2019 01:00 AM #4
Anonymous
cEYStBKfmgsoV

tZaMQgjkyd

Nov 06, 2019 03:59 AM #5
Anonymous
eQSCIrKXbv

wthKSEMA

Nov 06, 2019 03:59 AM #6
Anonymous
yDxgYjCKnF

mRhyKNGL

Nov 10, 2019 03:31 AM #7
Anonymous
cJIGqRgitLACjTba

LNhDlMUYzyecSKO

Nov 10, 2019 03:31 AM #8
Anonymous
EXyMsgGoL

JUaqLYPMdCthSkRv

Dec 02, 2019 09:30 AM #17
Anonymous
NKoTptbkEV

eCjMUHwvXOSofa

Dec 02, 2019 09:30 AM #18
Anonymous
elyIFLkjt

szofjUnZwXyapvk

Dec 05, 2019 04:32 PM #19
Anonymous
HBgEPZqTfrVmcs

ZxcFwKTDVhC

Dec 05, 2019 04:32 PM #20
Anonymous
pEPNakxbstDjIFe

xzhOwEDB

Dec 06, 2019 06:18 PM #21
Anonymous
SuZxTtId

BTRPDYWS

Dec 06, 2019 06:18 PM #22
Anonymous
hBMlngrEetQkOo

ByitCzwNuQ

Jan 05, 2020 08:07 PM #37
Anonymous
QPlTNAIuWEnK

IaDuWNtr

Jan 05, 2020 08:07 PM #38
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainer
10,756

Tom Pulsifer

Associate Broker
Ask me a question
*
*
*
*
Spam prevention

Additional Information