tax credit

noun

: an amount of money that is subtracted from taxes owed

Families with children in college will receive a tax credit this year.

Examples of tax credit in a Sentence

Recent Examples on the Web

EVs accounted for nearly a quarter of sales in the state during the first nine months of the year, juiced by the end of a $7,500 federal EV tax credit in October. —Chris Isidore, CNN Money, 20 Dec. 2025

To qualify, individuals had to be Arizona residents, file a full-year Arizona income tax return for 2021, claim Arizona’s dependent tax credit, and have at least some Arizona income tax liability. —Tiffany Acosta, AZCentral.com, 20 Dec. 2025

EVs have lost key support from the federal government, including a $7,500 tax credit, funding for charging, and restrictions on state level programs that incentivize automakers to produce zero-emission vehicles. —Robert Ferris, CNBC, 20 Dec. 2025

The state also offers a retirement tax credit. —Andrea Riquier, USA Today, 19 Dec. 2025

Rhymes for tax credit

• accredit
• discredit
• noncredit
• dedit
• edit
• microcredit

Legal Definition

tax credit

noun

: an amount that may be subtracted from the sum of tax otherwise due and that is distinguished from a deduction applied to gross income in the calculation of taxable income compare exemption