Tax Savings From an Additional Child

Research Report

Tax Savings From an Additional Child

November 5, 2010

Abstract

Provisions in the tax law that benefit families with children include the child tax credit, personal exemptions for dependent children, the earned income tax credit, availability of head of household filing status, the child and dependent care credit, and tuition tax credits and deductions for higher education. These six benefits average about $1,656 for the last (and youngest) child in a family. The average benefit per child is higher for middle income taxpayers than for low-income filers (who don't benefit from personal exemptions and non-refundable credits) and high-income filers (who don't receive benefits that phase out at higher incomes).

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