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My kids are worth how much? These are the special tax breaks for parents

Source Date: 
Wednesday, February 6, 2019

Love & Money is a MarketWatch serieslooking at how our relationship with money impacts our relationships with signicant others, friends and family. Most parents wouldn’ttrade the experience of raising children for anything in the world.If only it weren’t so darn expensive. Between the medical bills, child care and college tuition, it’s a wonder parenting hasn’t gone theway ofthewet nurse. Fortunately,the government offers some fairly generous tax breaks to help ease the financial burden. It’s up to taxpayers, of course,to take full advantage ofthem — and in some cases this can be diffcult, since it may involve figuring out which breaks are more beneficial than others.

There are a few things parents should understand. First, most child-related deductions and credits are available whether families take the standard deduction or itemize deductions. Second,there’s a difference between deductions and the more coveted tax credits. Don’t confuse the two. Adeduction, such as the college tuition and fees deduction, merely decreases taxable income. Atax credit, such as the child-tax credit, allows taxpayers to subtractthe amount dollar for dollar from their tax bill, or add the amountto their refund.

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