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

The nonpartisan Joint Committee on Taxation estimated the program could divert nearly $26 billion from federal coffers over the next decade to pay the cost of the tax credit. —Annie Martin, The Orlando Sentinel, 21 July 2025

There is also a bump for the child tax credit, with the maximum benefit going from $2,000 to $2,200 per child. —Kate Dore, Cfp®, Ea, CNBC, 20 July 2025

Federal tax credits for electric vehicles end Sept. 30 Currently, some electric vehicle buyers are eligible for a federal tax credit worth up to $7,500 for buying or leasing a new EV, and up to $4,000 for a used vehicle. —Camila Domonoske, NPR, 16 July 2025

State's affordable housing agency is also inspecting the building As a low-income housing tax credit property, the building is also required to maintain a certain number of affordable units through 2036. —Quinn Clark, jsonline.com, 15 July 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