Refundable Credit

Refundable Credit

A direct, dollar-for-dollar reduction of one's tax liability in which one still receives a tax refund even if one's liability drops below zero. That is, if a taxpayer otherwise owes $2,000 to the government, but takes $3,000 in refundable credits, then the government owes $1,000 to the taxpayer. Relatively few tax credits are refundable; most are limited to the amount of one's tax liability. However, the earned income tax credit is a common example of a refundable credit.

Refundable Credit

A credit for which the IRS will send the taxpayer a refund for any amount in excess of the taxpayer's tax liability.
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References in periodicals archive ?
In this scenario, the combined tax liability would decrease by $500 because the $1,000 increase in the refundable credit on the student's return outweighs the parents' loss of the $500 family tax credit (see the table "Dependent With Parents Over Credit Phaseout").
Maximizing the higher education tax credits: Including a scholarship in gross income can sometimes save on taxes
A student who claims the credit under this strategy is not entitled to any refundable credit.
Paying for Higher Education under the Tax Cuts and Jobs Act
(34) While the EITC is not the only refundable credit, it is
INSIGHTS FROM BEHAVIORAL ECONOMICS CAN IMPROVE ADMINISTRATION OF THE EITC
Refundable credit on qualified spend, including non-resident above- and below-the-line payroll
Alabama
When a low-income, low-tax worker qualifies for a refundable tax credit, and the size of the refundable credit is bigger than the worker's general income tax bill, the Internal Revenue Service (IRS) pays the worker for the difference between the tax credit and the general tax bill.
Sally Pipes proposes PPACA replacement plan
36B refundable credit for coverage under a qualified health plan.
Self-employed insurance deduction under the Affordable Care Act
Skate rentals, $3 with $25 refundable credit card or cash deposit required per skate rental.
Sunday/16
* If the amount of advance credit payments you get for the year is less than the tax credit you're due, you'll get the difference as a refundable credit when you file your federal income tax return.
Affordable Care Act tax deadline coming soon
The refundable credit is paid to the insurer to help fund the purchase of certain health insurance plans.
Safe Harbor Accounting Located in Deerfield Beach Informs the Community About Three Parts of the Affordable Care Act That the Supreme Court Recently Upheld
Another option is to make the CFTC and similar provincial credits a refundable credit similar to the Children's Activity Tax Credit (CATC) in Ontario and the Active Families Benefit in Saskatchewan.
Non-refundable tax credits are an inequitable policy instrument for promoting physical activity among Canadian children
A refundable credit, which offsets the costs of R&D even when the costs are greater than total tax liabilities, could help smaller, less-established companies with access to some funds or external financing to initiate R&D projects (HR 3156, as currently designed, is not refundable).
New technologies for neglected diseases: Can tax credits help biotechnology companies advance global health?

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