25.1 Overview of Personal Tax Credits
After you determine your regular tax liability using the tax table (22.2), Tax Computation Worksheet (22.3), or capital gain worksheets (22.4), and your AMT liability if any (23.1), you may be able to reduce that liability by claiming one or more tax credits. When this book went to press, Congress had not yet extended to 2012 the favorable rule allowing all nonrefundable personal credits to be claimed to the full extent of regular tax liability plus alternative minimum tax (AMT) liability, although the extension is expected. Even without the extension, many key 2012 credits such as the child tax credit, American Opportunity credit, saver’s credit and the adoption credit would be allowed to the extent of regular tax plus AMT liability. See the e-Supplement at jklasser.com for an update.
The additional child tax credit, earned income credit, and the health coverage credit are refundable for 2012, meaning that if the credit exceeds your tax liability you will receive a refund for the excess.
Eligibility rules and credit limitations for many of the personal credits are discussed in this chapter, while some are discussed in other chapters as shown below. Business tax credits are in Chapter 40.
Get J.K. Lasser's Your Income Tax 2013: For Preparing Your 2012 Tax Return now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
