Most of us welcome tax credits. But do you know the difference between a nonrefundable tax credit and a refundable tax credit? A nonrefundable tax credit reduces your tax bill dollar for dollar, but not below zero. For example, suppose you have a tax liability of $9,000 and qualify for a nonrefundable tax credit of $9,500. Your tax bill would be wiped out, but the remaining $500 of credit would be lost. If instead the tax credit is refundable, all or part of the $500 would be refunded to you. Credits that are partially refundable include the American Opportunity Tax Credit and the Child Tax Credit. For more: https://bit.ly/3T16sbA. Contact the Cg Team with questions. © 2024