What's the Difference? Tax Deductions vs. Tax Credits
What's the Difference? Tax Deductions vs. Tax Credits
Tax deductions and tax credits reduce your tax liability, but they do so in different ways. The good news? Both help you save money at tax time. Even better news? You don’t have to choose one or the other. Take as many deductions and credits as possible for your tax situation. Test your knowledge of the two here! Share your results on www.libertytax.com/tax-lounge/
Tax deductions and tax credits reduce your tax liability, but they do so in different ways. The good news? Both help you save money at tax time. Even better news? You don’t have to choose one or the other. Take as many deductions and credits as possible for your tax situation. Test your knowledge of the two here! Share your results on www.libertytax.com/tax-lounge/
Tax Credits are valued as a percentage of your tax bracket.
If your tax credit is $1,000, you'll save $1,000 on your tax return.
Non-refundable Tax Credits cannot reduce your tax liability below zero.
You must choose between tax deductions OR tax credits
You can choose between standard deductions and _____ deductions.
Deductions lower your taxable _____.