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Fiscal Cliff Could Slam Families

8:42 AM, Nov 15, 2012   |    comments
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WASHINGTON (WUSA) -- There are 47 days until a package of spending cuts and tax hikes hit the nation. If both sides of the political spectrum fail to reach a deal averting the Fiscal Cliff, new tax hikes will hit parents especially hard. They could have a really tough time paying for child care.

Starting January 2nd, parents who used to received a $1,000 child credit per child on their taxes, will see that credit cut to $500 per child. Accountants warn that families could lose hundreds of dollars that they used to be able to deduct from income as child care expenses. These potential changes would really affect families making $15,000 to $40,000 a year, just the people who use the tax credits the most.

This year, it is estimated that American families will claim over $38 billion in total child credits. $37 billion of those would go away if the country is allowed to head over the Fiscal Cliff.

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