Joe is confused about refundable versus nonrefundable credits. His preparer explains nonrefundable credits can reduce tax liability to zero but never add to his refund. Which of the following credits is a nonrefundable credit? a) Child and dependent care credit b) Additional child tax credit c) Earned income credit d) Excess Social Security withheld

Question

Camila Singleton

Business

5 January, 18:23

Joe is confused about refundable versus nonrefundable credits. His preparer explains nonrefundable credits can reduce tax liability to zero but never add to his refund. Which of the following credits is a nonrefundable credit? a) Child and dependent care credit b) Additional child tax credit c) Earned income credit d) Excess Social Security withheld

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Answers (1)

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Aaden Joyce · Answer 1

a) Child and dependent care credit

Explanation:

there are two types of credit tax one is refundable and other one is non-refundable and Child and dependent care credit which is non refundable, this basis on income level and earning of individual. This is type of credit which actually relief anyone who is spend more on their child care or souse care i-e disbale spouse or ill child.