Top 10 Tax Credits You Can Claim in 2026

Most people know that tax deductions reduce their taxable income. Fewer people fully understand tax credits, which are more valuable and more commonly missed.

Here is the key distinction: a deduction lowers the amount of your income that gets taxed. A credit directly reduces the amount of tax you owe, dollar for dollar. A $1,000 tax credit means $1,000 less on your tax bill. Some credits are even refundable, meaning if the credit exceeds what you owe, the IRS sends you the difference as a refund.

The problem is that many taxpayers either do not know which credits exist or assume they do not qualify without ever checking. Below are ten federal tax credits in 2026 worth understanding before you file.

Credits for Families

1. Child Tax Credit

What it is: A credit for taxpayers with qualifying dependent children under age 17.

Who qualifies: Taxpayers with children who meet the IRS definition of a qualifying child, subject to income phase-out thresholds. The credit begins to phase out at $200,000 for single filers and $400,000 for married filing jointly.

What it is worth: Up to $2,000 per qualifying child, with up to $1,700 refundable as the Additional Child Tax Credit for eligible taxpayers who owe less than the full credit amount.

2. Child and Dependent Care Credit

What it is: A credit for expenses paid to care for a qualifying child under age 13, or a dependent or spouse who is physically or mentally incapable of self-care, so that you can work or look for work.

Who qualifies: Taxpayers who paid for childcare, daycare, after-school programs, or in-home care for a qualifying individual while they worked or actively sought employment. Both spouses must have earned income if filing jointly.

What it is worth: Between 20% and 35% of qualifying care expenses, depending on your income. Maximum qualifying expenses are $3,000 for one dependent and $6,000 for two or more, making the maximum credit $1,050 and $2,100 respectively.

Credits for Lower and Middle-Income Earners

3. Earned Income Tax Credit (EITC)

What it is: One of the most valuable credits available to working individuals and families with moderate income. It is fully refundable, meaning you can receive it even if you owe no taxes.

Who qualifies: Workers and families with earned income below specific thresholds that vary based on filing status and number of qualifying children. For 2026, single filers without children must be between ages 25 and 64 to qualify.

What it is worth: Up to $7,830 for families with three or more qualifying children. The credit amount scales with income, filing status, and number of children. Many eligible taxpayers miss this credit entirely, particularly those without children who may not realize they qualify.

4. Saver’s Credit

What it is: A credit for lower and moderate-income taxpayers who contribute to a retirement account such as a 401(k), IRA, or similar qualified plan.

Who qualifies: Taxpayers who are at least 18, not full-time students, and not claimed as a dependent on someone else’s return, with adjusted gross income below the credit’s threshold (approximately $36,500 for single filers and $73,000 for married filing jointly for the 2025 tax year, make sure to verify current thresholds before filing).

What it is worth: 10%, 20%, or 50% of your retirement contributions up to $2,000 ($4,000 if married filing jointly), depending on income. Maximum credit is $1,000 per person.

Credits for Students and Lifelong Learners

5. American Opportunity Tax Credit (AOTC)

What it is: A credit for qualified education expenses paid for a student in their first four years of higher education.

Who qualifies: Students enrolled at least half-time in a program leading to a degree or credential, with no felony drug convictions, whose modified adjusted gross income falls below $90,000 for single filers ($180,000 for married filing jointly). The credit phases out between $80,000 and $90,000 for single filers.

What it is worth: Up to $2,500 per eligible student per year. Up to 40% of the credit ($1,000) is refundable. Qualified expenses include tuition, fees, and course materials.

Learn the most common tax planning mistakes, how they increase tax liability, and how proactive tax planning helps taxpayers avoid costly surprises.

Learn More

6. Lifetime Learning Credit (LLC)

What it is: A credit for tuition and fees paid for undergraduate, graduate, or professional courses, including courses taken to acquire or improve job skills. Unlike the AOTC, there is no limit on the number of years you can claim it.

Who qualifies: Taxpayers paying qualified education expenses for themselves, a spouse, or a dependent, with modified AGI below $90,000 for single filers ($180,000 for married filing jointly).

What it is worth: 20% of the first $10,000 in qualified education expenses, for a maximum credit of $2,000 per tax return. Note that you cannot claim both the AOTC and the LLC for the same student in the same year.

Credits for Homeowners

7. Energy Efficient Home Improvement Credit

What it is: A credit for homeowners who make qualifying energy-efficiency improvements to their primary residence, including insulation, exterior windows and doors, heat pumps, central air conditioning, and water heaters.

Who qualifies: Homeowners who install qualifying energy-efficient products in an existing home that serves as their primary residence. New construction does not qualify.

What it is worth: 30% of the cost of qualifying improvements, up to an annual cap of $1,200 for most improvements, with higher limits for certain products such as heat pumps ($2,000). This credit resets annually, meaning you can claim it each year you make eligible improvements.

8. Residential Clean Energy Credit

What it is: A credit for homeowners who install qualifying clean energy systems, including solar panels, solar water heaters, wind turbines, geothermal heat pumps, and battery storage systems.

Who qualifies: Homeowners who install qualifying systems at a primary or secondary residence in the United States. Some systems must meet specific efficiency standards.

What it is worth: 30% of the total cost of qualifying systems, including installation, with no annual dollar cap. This can represent a significant credit for homeowners making major clean energy investments.

Credits for Health Coverage and Caregivers

9. Premium Tax Credit

What it is: A refundable credit that helps eligible individuals and families afford health insurance purchased through the Health Insurance Marketplace.

Who qualifies: Taxpayers who purchase coverage through the federal or state Marketplace, whose household income falls within the qualifying range, and who are not eligible for affordable employer-sponsored coverage or government health programs like Medicaid. Eligibility is determined at the time of enrollment and reconciled when you file your return.

What it is worth: The credit amount varies based on income, family size, and the cost of available Marketplace plans in your area. It can be taken in advance to reduce monthly premiums or claimed as a lump sum when you file.

10. Credit for Other Dependents

What it is: A nonrefundable credit for taxpayers who support a qualifying dependent who does not meet the requirements for the Child Tax Credit. This includes older children, elderly parents, and other qualifying relatives the taxpayer financially supports.

Who qualifies: Taxpayers who claim a qualifying dependent on their return who does not qualify for the Child Tax Credit. The dependent must have a valid Social Security Number or Individual Taxpayer Identification Number.

What it is worth: Up to $500 per qualifying dependent. While smaller than other credits on this list, it is commonly overlooked by taxpayers caring for elderly parents or adult dependents.

Don’t Leave Credits Behind

Tax credits do not find you. You have to know they exist, understand whether you qualify, and claim them correctly on your return. Missing a single credit can mean hundreds or thousands of dollars left on the table, and the complexity of eligibility rules makes it easy to miss credits without realizing it.

At Manley Garvin, our team works with individual taxpayers to identify every credit they qualify for, ensure documentation is in order, and file returns that are accurate, complete, and optimized for their situation. Whether you are a first-time filer, a growing family, a homeowner making efficiency upgrades, or a caregiver supporting a dependent, we will make sure your return reflects everything you are entitled to.

Share This Post

More Like This

Entrepreneur Working With Laptop And Files On Clipboard To Plan

Standard Deduction vs Itemized Deductions: What’s Better for You in 2026?

Individual Tax

Collaboration, Business People Working In Office

Filing Taxes for the First Time in 2026: What You Need to Know