Tax Breaks for Single Mothers

For millions of American families — especially those headed by single women, tax season is full of stress and number crunching.

There are, however, some useful tax credits that can significantly lower the amount of taxes to pay. And, in some cases, give cash refunds to families in jobs that pay too little to live on.

Claiming a tax credit is like putting money back in your pocket, and for single mother, this can make a real difference to the bottom line.

In fact, at tax time, being a parent comes with certain perks.

For example, if you are a single mother of two earning less than $55,768, you could claim up to $6,960 in EITC, up to $4,000 in Child Tax Credit, plus as much as $6,000 spent on care expenses.

Personal & Dependent Exemption

Personal exemption has been suspended.

The Tax Cuts and Jobs Act of 2018 has suspended all personal and dependent exemptions for tax years 2018—2025. For the 2018 tax year and beyond, you can no longer claim a personal exemption for yourself, your spouse, or your dependents.

Filing Taxes as a “Head of the Household”

As a single mother and the sole breadwinner in the family, the first thing you must do is to select “Head of the Household” as your filing status. ¹

Filing as “Head of Household” has two benefits. First, you’ll pay less taxes overall; and second, you’ll also be able to claim a larger tax exemption.

Filing Status	2024
Single or Married Filing Separately	$14,600
Head of Household	$21,900
Married Filing Jointly or Qualifying Widow(er)	$29,200

What is the head of household deduction for 2024?

For tax year 2024, taxpayers who use the head of household filing status may receive an $21,900 annual standard deduction.

In comparison, a single filer is only entitled to a $14,600 standard deduction.

Earned Income Tax Credit

EITC, the Earned Income Tax Credit is a tax benefit designed primarily to help low- to moderate-income individuals and families whose earned income falls below a certain limit.

It isn’t a welfare handout per se. Only people who work and pay taxes can claim it; creating an incentive for them, including many who are poor, to leave welfare for work. ²

The EITC is “refundable,” which means that when EITC exceeds the amount of taxes owed, it results in a tax refund, whose amount varies by income, family size and filing status. ³

Use the EITC Assistant to find out if you qualify.

EITC FAQ

What is the maximum income to qualify for earned income credit 2024?

Depending on your filing status and number of qualifying children, you might be eligible for the credit on your 2024 federal tax return if your income is under $66,819.

NO. OF CHILD	MAXIMUM CREDIT	SINGLE	MARRIED
None	$632	$18,591	$25,511
1	$4,213	$49,084	$56,004
2	$6,960	$55,768	$62,688
3 or more	$7,830	$59,899	$66,819

How much is the EIC for 2024?

For the 2024 tax year, the earned income credit ranges from $632 to $7,830, depending on your filing status and how many children you have.

Single parents with two children under age 19 who made less than $55,768 are eligible for a refundable credit of up to $6,960. In contrast, couples with no dependent children earning less than $25,511 can receive no more than $632.

Which states have EITC?

Thirty one (31) states and the District of Columbia, as well as New York City, offer their own version of Earned Income Tax Credits to complement the federal credits — applying a percentage match to the federal allocation.

How long does it take to get my tax refund?

In general, the IRS will process your refunds and issue payments within 21 days. For paper filers, this can take much longer. However, the PATH Act, passed in 2015, stipulates that the IRS must withhold refunds until February 15.

So if you file before February 15, you’re owed a tax refund and you’re claiming either the ACTC or EITC, your entire refund will be withheld until at least the February 15 deadline.

The IRS has eliminated the guesswork of waiting for your tax refund by creating IRS2Go, an app that allows you to track the status of your return. You can also check the status of your refund with the Where’s My Refund? online portal.

Child Tax Credit

If your child or children under the age of 17, claimed as dependents and are US citizens with Social Security number, there is a good chance you qualify for the Child Tax Credit.

The child tax credit provides a credit of up to $2,000 per child under age 17. If the credit exceeds taxes owed, families may receive up to $1,700 per child as a refund, known as the Additional Child Tax Credit (ACTC) or refundable CTC.

Families whose credit exceeds their tax liability can receive the remainder of the credit in the form of a refund not exceeding 15% of their earnings above $2,500. ⁴

For example, a single mother with two children who earns $14,000 in 2024 could receive 15% of $11,500, or $1,725, or roughly $850 per child, as a refund.

Education Tax Benefits

There are two (2) tax credits available to help you offset the costs of higher education by reducing the amount of your income tax. They are the American Opportunity Credit and the Lifetime Learning Credit.

If you are eligible for both the American Opportunity Credit and the Lifetime Learning Credit, you can choose to claim either credit, but not both.

American Opportunity Tax Credit

The American Opportunity Credit is a tax credit of up to $2,500 of the cost of tuition, fees and course materials, which can be claimed for expenses for the first four (4) years of post-secondary education.

Benefit Amount

$2,500 tax credit per student ⁵
40% of credit may be refundable; the rest is nonrefundable
Limit: First 4 years of post-secondary education

Income Phaseout

$90,000 (single) $180,000 (joint)

Lifetime Learning Tax Credit

Unlike the American Opportunity Credit 10, the Lifetime Learning Credit is “non-refundable” so the maximum credit is limited to the amount of tax you owe. There is, however, no limit on the number of years for which you can claim a Lifetime Learning Credit.

Benefit Amount

$2,000 tax credit per student ⁶
Nonrefundable — credit limited to the amount of tax you must pay on your taxable income
Unlimited number of years

Income Phaseout

$90,000 (single) $180,000 (joint)

Student Loan Interest Deduction

Under the law, you’re allowed a tax deduction for the interest paid on qualified student loans, including private student loans that you took out for yourself, your dependent or your spouse.

If you meet the eligibility criteria, you may deduct either $2,500 in student loan interest or the actual amount of loan interest you paid during the year — whichever is less.

FAQ

Can you still claim student loan interest on taxes?

Yes. The most student loan interest you can claim as a tax deduction is limited to $2,500 as of the 2024 tax year.

What is the income limit for student loan interest deduction?

The limit of the amount of income you can make and still qualify for the student loan interest deduction, based on your filing status, for the 2024 tax year is $90,000 if single or $180,000 if married filing jointly.

Can a co-signer deduct student loan interest?

Yes, a parent who co-signed student loans may claim the student loan interest deduction too as long as the student is a dependent of the co-signer.

What is IRS Form 1098-E?

IRS Form 1098-E is the Student Loan Interest Statement that your federal loan servicer will use to report student loan interest payments to both the Internal Revenue Service (IRS) and to you.

Get Help with Your Taxes

Interactive Tax Assistant

If you have tax questions, you should check out the Interactive Tax Assistant on IRS.gov. This tool provides answers to a number of tax questions. It can help determine if a type of income is taxable, if you’re eligible to claim certain credits, and if you can deduct expenses on your tax return.

Volunteer Income Tax Assistance (VITA)

The IRS offers free tax preparation through a program called Volunteer Income Tax Assistance (VITA). These sites are usually open from the end of January through April 15.

In addition to VITA, the Tax Counseling for the Elderly (TCE) program also offers free tax help for all taxpayers, particularly those who are 60 and older, specializing in questions about pensions and retirement-related issues unique to seniors.

To locate the nearest VITA or TCE site near you, call
800-906-9887

Low-Income Taxpayer Clinic

Funded by the IRS, Low Income Taxpayer Clinics (LITCs) represent low income individuals in disputes with the IRS — for free or for a small fee, including audits, appeals, collection matters, and federal tax litigation.

No application is needed to utilize this service. Each LITC will determine if you meet the income guidelines and other criteria before it will agree to represent you.

If you believe you’re eligible — and in need of help with tax matters, find the clinic nearest you and call the numbers listed on the list for an appointment.

Footnotes

IRS, Publication 501, Exemptions, Standard Deduction, and Filing Information. ↩
Center on Budget and Policy Priorities, Policy Basics: The Earned Income Tax Credit. ↩
IRS, Earned Income Tax Credit (EITC) Tables ↩
CBPP, Policy Basics: The Child Tax Credit. ↩
Kiplinger. Child Tax Credit 2021: Who Gets $3,600? Will I Get Monthly Payments? And Other FAQs ↩
IRS, Publication 970, Tax Benefits for Education, Table 2-1 ↩

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