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

Some of the savings will be funneled to accelerate a full local match for the federal Earned Income Tax Credit and establishing a local child tax credit of $1,000 per child for eligible families, the council said. —Medora Lee, USA Today, 16 Nov. 2025

The budget takes effect immediately for the 2025-26 fiscal year, with families able to begin claiming the new tax credit this year. —Alia Shoaib, MSNBC Newsweek, 14 Nov. 2025

Democrats wanted to extend an enhanced tax credit expiring at the end of the year that lowers the cost of health coverage obtained through Affordable Care Act marketplaces. —Kevin Freking, Fortune, 13 Nov. 2025

Kaauwai reports that there are hopes to improve the tax credit further during this year’s state legislative session. —Mathew Scott, HollywoodReporter, 13 Nov. 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