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Deductions & credits
A dollar of tax credit is more valuable than a dollar excluded from income. A one dollar tax credit reduces tax liability by one dollar. Each dollar put into an FSA on a pre-tax basis used to pay for childcare expenses reduces tax liability by the taxpayer's marginal tax rate times the contribution (e.g., 22% x $1 = 22 cents).
‎January 29, 2024
12:08 PM