State Tax Season: Unlocking Additional Savings Beyond Federal Credits
Maximizing Your State Tax Refund: Exploring State-Specific Tax Credits
As tax season nears its end, individuals still looking to maximize their refunds may find opportunities beyond federal tax credits in their respective state tax codes. With the average IRS refund sitting at $3,182 as of March 1, filers are eager to identify additional credits that could boost their returns. While federal tax credits often take center stage, state tax codes offer various incentives that can help taxpayers reduce their state tax liability and potentially receive cash back. In California, residents filing returns may tap into credits such as the California Earned Income Tax Credit, which could provide up to $3,529, along with other rebates like the Young Child Tax Credit and the Foster Youth Tax Credit. Additionally, those living in areas affected by a presidentially declared disaster may claim rebates, with the option to obtain free copies of previous tax returns if needed due to a disaster. Meanwhile, Colorado offers an $800 refund per person under the Taxpayer’s Bill of Rights (TABOR) mechanism, benefitting eligible individuals aged 18 and above without a Colorado income tax liability.
Understanding Tax Credits to Optimize Your Refund – State Tax Savings 101!(PHOTO: getty images)
Oregon’s “Kicker” Tax Credit: How It Works and Eligibility Requirements
Oregon taxpayers, on the other hand, may qualify for the state’s “kicker” tax credit, triggered when General Fund revenues surpass 2% of projections. To be eligible, filers must meet specific criteria, including filing their 2022 Oregon return before filing their 2023 return and having an Oregon tax liability for 2022. Washington state rounds out the list with its “Working Families Tax Credit,” mirroring the federal Earned Income Tax Credit. Families qualifying for this credit may receive a minimum of $50, with varying maximum credits based on the number of children in the household, ranging from $315 to $1,255.
