New BBB Course!
Stay ahead of the curve—enroll now to master the One Big Beautiful Bill Act and confidently guide your clients through its sweeping tax changes.
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Are you a California CNA?
Governments have historically used a “carrot and stick” approach to encouraging individuals and businesses to behave in ways it deems desirable: tax credits for acting as requested and tax penalties for failing to behave as required. The U.S. government similarly promotes multiple forms of socially-beneficial actions—adopting children, becoming employed, providing funds for dependents’ education, and other socially-desirable activities—by offering incentives in the form of tax credits for engaging in them. This course examines the various tax credits that may be claimed by individual taxpayers and explains how each tax credit works, its eligibility requirements, limitations, phase-outs, etc. and, for refundable tax credits, their due diligence requirements. Of the 161,336,659 federal income tax returns received in 2023 (2022 income) by the IRS, 61,831,870 taxpayers—about 38%—claimed one or more federal income tax credits amounting to a total of $154.8 billion. For a tax preparer that prepares 150 to 200 tax returns in a season, the numbers indicate that he or she is likely to encounter between 55 and 75 returns claiming income tax credits that average approximately $2,500.
Course Publication Date: October 01, 2025
This course is available with NO ADDITIONAL FEE if you have an active self study membership or all access membership or can be purchased for $40.00!
| Author: | Paul Winn |
| Course No: | TAX-INCRED-2105-M |
| Recommended CPE: | 4.00 |
| Delivery Method: | QAS Self Study |
| Level of Knowledge: | Overview |
| Prerequisites: | None |
| Advanced Preparation: | None |
| Recommended Field of Study: | Taxes
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Learning Objectives
- Compare federal income tax credits to federal income tax deductions.
- Explain the difference between refundable, nonrefundable tax credits and partially-refundable tax credits.
- Identify the unused federal income tax credits that may be carried forward to later years.
- Identify the requirements for claiming the Child Tax Credit.
- Recognize the applicability of the Lifetime Learning Tax Credit.
- List the home improvements that qualify taxpayers for the Energy-Efficient Home Improvement Credit.
- Describe the Child And Dependent Care Tax Credit.
- Identify the taxpayer contributions that qualify for the Retirement Savings Contribution Credit.
- Describe the Home Mortgage Tax Credit and the Foreign Income Tax Credit.
- List the home improvements that qualify taxpayers for the Energy-Efficient Home Improvement Credit.
- Calculate the tax credit available for energy-efficient home improvements.
- Define qualified energy property.
- Describe a clean vehicle eligible for an electric vehicle tax credit.
- Apply the rules governing electric vehicle purchase tax credits.
- Identify the maximum MAGI beyond which a taxpayer is ineligible for a new or previously-owned clean vehicle tax credit.
- Identify the income tax credits that are refundable in whole or in part.
- Calculate and describe the eligibility requirements for claiming the Additional Child Tax Credit.
- Describe the American Opportunity Tax Credit.
- Calculate and describe the eligibility requirements for claiming the Adoption Tax Credit.
- Identify the requirements that apply to claiming the Earned Income Tax Credit.
- Calculate the Premium Tax Credit.
- List the due diligence requirements a tax preparer must meet when preparing a tax return claiming the Earned Income Tax Credit (EIC), American Opportunity Tax Credit (AOTC), Child Tax Credit, Additional Child Tax Credit, and Other Dependent Credit (CTC, ACTC, ODC.
- Recognize the records a tax return preparer is required to keep to support a client’s claim for the EIC, AOTC, CTC, ACTC and ODC.
- Identify the penalties that may be imposed on a tax preparer for failing to comply with due diligence requirements when preparing a client’s tax return claiming the EIC, AOTC, CTC, ACTC or ODC.
- Recognize the sanctions that may be imposed on an employer whose employee fails to comply with EIC, AOTC, CTC, ACTC and ODC due diligence requirements.
- Identify the additional requirements imposed on taxpayers claiming the EIC, AOTC, CTC, ACTC and ODC following disallowance and the exceptions to those requirements.
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