01 Jul Would I get tax credits if I file a tax return?

Q. I don’t have to file a tax return because I don’t earn enough. I also don’t have children. Are there credits I could be eligible for if I would file a tax return?
— Wondering

A. Maybe.

First, we must distinguish between tax deductions and tax credits.

If you have a $100 tax deduction and you are in the 12% tax bracket, you will save $12, explained Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown.

If you have a $100 tax credit, you will save $100, he said.

“Tax credits save dollar for dollar,” he said. “Some tax credits can lower your tax bill to zero. Others can reduce your tax bill to zero and get you a refund check too. These are known as refundable tax credits.”

There are several refundable tax credits available, but you need to qualify. And we note you said you don’t have children, but we’re including those credits here, too.

For example, there’s the Earned Income Tax Credit.

“This credit is for low-income households with or without children,” he said.

Then there’s the Child Tax Credit, which Kiely said is partially refundable.

The American Opportunity Tax Credit is also partially refundable.

“This credit is if you paid college expenses for a qualifying college student,” he said.

You may also be eligible for what’s known as the Premium Tax Credit.

“This credit is for low-income households who buy health insurance through the Health Insurance Marketplace,” Kiely said.

Most tax programs will help to identify credits for which you’re eligible, and you’re probably eligible to file using IRS Free File.

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This story was originally published in July 2024.

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