Скачать или смотреть What is the definition of a refundable tax credit?

Taxpayers can receive a refund for a credit that exceeds their tax liability.

Refundable Tax Credit can reduce your tax liability to zero, and if the credit is larger than the amount of tax you owe, the excess amount will be refunded to you. Refundable credit that can be used include the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ATC).

The benefit of refundable tax credits lies in their guarantee that you will receive the full value of the credit, even if you don't owe any taxes.

Let's assume you are eligible for a $1,000 refundable tax credit and your tax liability is $700. You will receive a refund of $300 after the credit first reduces your tax liability to zero.