A Quick Overview of the Single Parent Tax Credit

The federal government put tax credits and deductions to help ease tax liabilities and help taxpayers save on their returns. They, however, work differently. The tax credit will reduce your income tax bills. They are of different types, including the single-parent tax credit.

A single-parent tax credit reduces the total amount of taxes owed to the government by a taxpayer who is the sole caregiver for a child. They are eligible for the Single Parent Child Care Credit.

Whether the tax credit will help promote behavior or ease the burden of raising a child, a tax credit for single parents is designed to help shield them from the never-ending expenses of a child's needs. Here's everything you need to know about single-parent tax credits and the various types of tax credits available to single parents.

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Who Is Eligible for Single Parents Child Care Credit? 

To claim SPCCC, the single parent and the child must meet certain criteria. Here’s a list of conditions that the child and the single parent or guardian must meet to qualify for the credit:

Primary Claimant 

This is the person with whom a qualifying child has lived for more than six months. They can be their parents or guardians who care for the child at their own expense for the majority of the year. 

Secondary Claimant 

The primary claimant can waive their SPCCC entitlement in order to favor a secondary claimant, who is usually an individual who meets all other conditions except the one of living with the child for the majority of the year. They do not need legal custody of the qualifying child, but they must demonstrate that the child lives with them for 100 days per year. 

Qualifying Child 

The child should be born during the tax year, plus must be under the age of 18 at the start of the tax year. Additionally, the child can be over 18 but in full-time education. The qualifying child can be yours, adopted, or a stepchild you’re supporting at your own expense. It means that you’re taking care of the daily upbringing of a child and are responsible for their care.

One cannot claim SPCCC, whether or not they’re a primary or secondary claimant if they are:

  • Jointly considered as a married individual 
  • Married or in a civil partnership 
  • Cohabiting 

Saver’s Credit 

Single parents wanting to get tax credits must save. The federal government encourages taxpayers to save for their retirement, especially single parents. It is geared toward moderate and low-income workers. The saver’s credit can be a great boost to single parents.

Therefore, they can take advantage of saving for their retirement in Individual Retirement Account (IRA) and employer’s 401(k) plan. This credit helps you offset the first portion of your savings. The maximum amount you can get is $2,000.

Tax Credit for Adoption 

If you’re a single person that has just completed an adoption process, you’re eligible for a tax credit for adoption. It was designed to cover all expenses that go along with adopting a child under the age of 18 or any individual that can’t take care of themselves because of physical or mental disabilities. One can get a tax credit of $13,190 as of 2015 if their modified gross income is less than $197,880. If it’s over $237,880, your credit will be according to your sliding scale.

Earned Income Tax Credit

Tax credits are available to various taxpayers, not just for single parents. The credit size is quite huge, therefore, it can’t be overlooked. It helps taxpayers hold more of their income, even those who don’t owe taxes can be eligible for earned income tax credit. To qualify, a taxpayer must file as head of household and modify their adjusted gross income to more than $51,567.

The credit may vary from person to person. If you’ve adjusted your income to $51,567, you could receive a tax credit of up to $6,143 with three qualifying children – while those with fewer qualifying children get less; $5,460 for two qualifying children and $3,305 for one qualifying child.

Tax Credit for Child and Independent Care

Childcare is expensive as annual childcare ranges from $12,068 in California and $16,430 in Massachusetts, according to Child Care Aware of America. The good news is that single parents can get a tax credit for a child and independent care to reduce the overall tax they owe the government. 

If you pay someone to care for your child or a dependent with a disability while you work, look for work, or attend full-time schools, you’re eligible for a child and independent care tax credit. This amount will vary depending on the number of kids you have, plus the expenses needed to care for them. The maximum tax credit you can get is $3,000.

Head of Household Tax Credit 

Filing as head of household is not technically a credit, but it will result in some kind of waiver on your overall tax bill if you’re a single parent who lives with the child for half the year and provides 50% of household needs. It can boost several exemptions for several thousands of dollars.

Premium Tax Credit 

It’s also known as Health Coverage Tax Credit, which is effective when a taxpayer registers for health insurance offered via an affordable care act. The tax credits for single parents are meant to shield a taxpayer from monthly payments of premiums. Generally, a taxpayer's tax credit amount will depend on the income put against the federal poverty rate. It was designed to cover the difference between the cost of the health insurance plan and the amount you’re required to pay.

Seek Tax Planning Services from a CPA Firm

Tax planning is the best way single parents can minimize tax exposure. Seeking services from professionals from Marcus Fairall Bristol + CO PLLC who can help you manage complicated tax issues is imperative.

Certified public accountants will advise you on any tax credits, exemptions, and deductions that may be available to you. Furthermore, their knowledge and experience can assist you in planning for your retirement future by indicating what options you have.

If you have any questions about taxation, forensic accounting, or anything else related to small businesses, please contact us at (915) 775-1040. We provide our clients with a wide range of accounting services, including the following:


Marcus, Fairall, Bristol + Co., PLLC
Full-Service CPA Firm
230 Thunderbird Dr. Ste G
Phone: (915) 775-1040

Location: El Paso, TX, USA

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