Credits

There are tax credits and there are tax credits. Some are refundable meaning you get the credit even if you own no tax and others are non refundable meaning you can only deduct the credit from taxes you owe. Trump has proposed to increase the current $2,000 dollar child credit of which $1,500 is refundable to a $5,000 fully refundable credit. This is an excellent way to narrow the income gap. This means that a family of four with an income of $107,000 would pay no federal income tax and in most states no state income tax. The $7,500 tax credit on EV's is non refundable meaning you must owe taxes before you can get the credit. This will require no new federal programs since this is already in existence. It is reported that Harris wants to increase the child tax credit to $6,000 but the family must have a child under one year old.