JohnB5677
Expert Alumni

Deductions & credits

Yes you are correct.  You can subtract Tax Credits from the amount of tax you owe.   As opposed to a Tax Deduction that will reduce your income before you figure the amount of tax you owe. 

 

A deduction will reduce your tax by reducing the amount of money you are being taxed on.

 

A Credit will actually reduce the tax.  In some cases it will generate a refund.

 

@botondkopacz

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