Review:
Tax Credits
overall review score: 4.5
⭐⭐⭐⭐⭐
score is between 0 and 5
Tax credits are incentives provided by governments to taxpayers that reduce the amount of tax they owe.
Key Features
- Reduces tax liability
- Can result in a refund if credit exceeds tax owed
- Encourages certain behaviors or investments
Pros
- Helps lower-income individuals and families
- Encourages investment in specific industries (e.g. renewable energy)
- Can stimulate economic growth
Cons
- Complexity of tax code can make it difficult to understand eligibility
- May disproportionately benefit higher-income individuals or corporations