This matters because I must upgrade from the free version in order to claim this credit but it is seemingly all for nothing. My price for free version is $0 when all is done and ready to file whereas once i upgrade to the deluxe version for $60 I am forced to pay for the State filing for an additional $40 bringing my total cost up to $100.
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You can downgrade if you choose. I will provide an FAQ at the end of my answer to give instructions on how to do this (you will have to start your return over though). But let me explain what has happened:
The Tax Cuts and Jobs Act changed the Child Tax Credit. It used to be that the credit was $1000 per child, and, if your tax liability was zero, the unused portion of the credit could be refundable depending on your earned income. A credit like the Child and Dependent Care Credit (a nonrefundable credit) would always help a greater portion of the Child Tax Credit to become refundable unless your tax was already at zero. For this reason, nonrefundable credits such as the Dependent Care Credit were always calculated and deducted before the Child Tax Credit, because doing so increased the refund.
Now, under the TCJA, the Child Tax Credit is potentially $2000 per child. But, only $1400 of that $2000 is potentially refundable, which means that $600 of the credit per child is nonrefundable. However, the IRS has not changed the order of taking the credits, which leads to credit redundancy. Your nonrefundable credit of $234 for Dependent Care Credit is "absorbed", for lack of a better word, by the nonrefundable portion of the Child Tax Credit.
If that credit was the only reason why you were being upgraded to Deluxe, you can Clear and Start Over to go back to the Free edition, and don't enter your daycare information, because you won't need it. This FAQ I promised explains how: https://ttlc.intuit.com/replies/3288495
You can downgrade if you choose. I will provide an FAQ at the end of my answer to give instructions on how to do this (you will have to start your return over though). But let me explain what has happened:
The Tax Cuts and Jobs Act changed the Child Tax Credit. It used to be that the credit was $1000 per child, and, if your tax liability was zero, the unused portion of the credit could be refundable depending on your earned income. A credit like the Child and Dependent Care Credit (a nonrefundable credit) would always help a greater portion of the Child Tax Credit to become refundable unless your tax was already at zero. For this reason, nonrefundable credits such as the Dependent Care Credit were always calculated and deducted before the Child Tax Credit, because doing so increased the refund.
Now, under the TCJA, the Child Tax Credit is potentially $2000 per child. But, only $1400 of that $2000 is potentially refundable, which means that $600 of the credit per child is nonrefundable. However, the IRS has not changed the order of taking the credits, which leads to credit redundancy. Your nonrefundable credit of $234 for Dependent Care Credit is "absorbed", for lack of a better word, by the nonrefundable portion of the Child Tax Credit.
If that credit was the only reason why you were being upgraded to Deluxe, you can Clear and Start Over to go back to the Free edition, and don't enter your daycare information, because you won't need it. This FAQ I promised explains how: https://ttlc.intuit.com/replies/3288495
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