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In the US the child tax credit serves a similar purpose and is precisely a negative tax: $300/month under age 6 then $250/month thereafter. Essentially the sam
by RhysU 10mo ago
In the US the child tax credit serves a similar purpose and is precisely a negative tax: $300/month under age 6 then $250/month thereafter.
Essentially the same amount as Germany give or take currency. That has long been in place though the amounts have changed over time.
Not every family gets this credit. It phases out at sufficiently high income.
- em-bee 10mo agointeresting. how does that work specifically? if your income is so low that you don't pay taxes, do you actually get cash? the german system simply pays out the money unconditionally. regardless of income. it doesn't affect your taxes, but if the regular taxes happen to lower then you get more money than you pay.
- RhysU 10mo agoFrom the IRS... > A portion of the Child Tax Credit is refundable for 2024. This portion is called the Additional Child Tax Credit (ACTC). For 2024, up to $1,700 per child may be refundable.
- em-bee 10mo agocan you elaborate how that works in practice? say i am earning 2000$ per month. i pay $100 on taxes on that. so that's $24000 income and $1200 in taxes per year. $1700 as a tax credit, does that mean my taxes are 0? or do i get $500 on top of my income? so after taxes how much do i have? 24000? 24500? and where are the $250 per month you mentioned? here is how it works in germany: 24000 euro is my income. 1200 euro are my taxes. but i get 3000 euro unconditional per child. so after taxes my total income is 25800 euro with one child. add 3000 for each additional child. the actual tax rate is made up, and just set to 5% to make the comparison easier.