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

And that came from a lot of conversations and an understanding that this is our legacy industry and tax credit programs like ours — these are jobs programs. — Cynthia Littleton, Variety, 25 July 2026

The Saver’s Match is replacing the Saver’s Credit, which is a nonrefundable tax credit designed to encourage low- and middle-income savers to contribute to a retirement plan. — Becca Stanek, TheWeek, 24 July 2026

Unlike a deduction, which lowers your taxable income, a tax credit directly reduces your tax bill. — Miranda Marquit, Encyclopedia Britannica, 24 July 2026

The county’s recent tax credit efforts, spearheaded by Interim County Executive Phil LeVota, have been criticized for excluding people who owned property in Jackson County in 2023 but have since sold or moved. — Ilana Arougheti july 23, Kansas City Star, 23 July 2026

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