Some of you may already know this from years of filing. However, a lot of would-be parents and first-time parents have absolutely no idea about this very important fact from the IRS.




Here are the basic entitlements you may be able to claim as part of Child Tax Credit and Working Tax Credit:

"With the Child Tax Credit, you may be able to reduce the federal income tax you owe by up to $1,000 for each qualifying child under age 17. A qualifying child for this credit is someone who:

• Is claimed as your dependent,
• Was under age 17 at the end of 2004,
• Is your son, daughter, adopted child, grandchild, stepchild or eligible foster child, your sibling, stepsibling or their descendant, and
• Is a U.S. citizen or resident alien.

The credit is limited if your modified adjusted gross income is above a certain amount. The amount at which this phase-out begins varies depending on your filing status:

• Married Filing Jointly $110,000
• Married Filing Separately $55,000
• All others $75,000
• "

For the complete tax tip, head on to the IRS website.