06/08/2026
Do you know the difference between tax credits and deductions?
Here's a simple way to think about it π
π° Tax Credits = dollar-for-dollar savings on your tax bill
π Tax Deductions = reduce the amount of income that gets taxed
Example:
A $1,000 tax credit could save you the full $1,000.
A $1,000 deduction lowers your taxable income, so the actual savings depend on your tax bracket.
Both can help you save money, but in very different ways. Understanding the difference will mean no surprises during tax season.
Not sure which tax breaks you qualify for? Call Paramount Tax & Bookkeeping Mansfield to schedule an appointment today for a tax review!