Caring for children is costly, but these federal and state tax breaks help.

CHICAGO, March 10, 2025 – Raising kids is expensive! In fact, SmartAsset’s 2024 study found the median annual cost of raising a child in the United States is $22,850 when accounting for just their child care, housing, food, medical care, and transportation—but any parent knows there are far more costs than those, and costs vary dramatically by state. Here in Illinois, parents can expect to spend $23,821 annually on a single child, according to the study.

With Tax Day just over a month away, busy parents that haven’t filed a tax return yet still have time to collect a tax break. The Illinois CPA Society suggests parents speak with their CPAs—certified public accountants—to get help identifying and maximizing the many tax credits and deductions available to them, like these:

1. Child Tax Credit: This credit may be worth up to $2,000 per qualifying child or dependent who has a valid U.S. Social Security number, per annual income limitations.
2. Child and Dependent Care Credit: Did you pay someone to care for your child or another qualifying person so you (and your spouse if filing jointly) could work or look for work? If so, you may be able to claim a credit of up to $3,000 (or $6,000 for two or more qualifying individuals) for your child and dependent care expenses. Dependent care expenses like daycare and day camp (not including overnight camps) for dependents under the age of 13, or dependents of any age who are incapable of self-care and who live with you for more than half of the year, may qualify for this federal credit.
3. Adoption Tax Credit: If you adopted a child through eligible international, domestic, private, or public foster care adoptions, you could claim a credit for up to $16,810 in qualified expenses in 2024. Further, if you received adoption benefits from your employer, you could also exclude up to $16,810 of those benefits from your income. The credit is nonrefundable, so you can’t get back more than you owe in taxes.
4. American Opportunity Tax Credit (AOTC): This credit is for qualified education expenses paid for an eligible student for the first four years of higher education. Per annual income limitations, the maximum annual credit is $2,500 per eligible student, and if the credit brings the amount of tax owed to zero, 40% of any remaining credit amount (up to $1,000) is refundable.
5. Student Loan Interest Deduction: Did you incur interest on loans for qualifying higher education? If eligible based on annual income, you may be able to deduct the lesser of $2,500 or the amount of interest actually paid during the year.
6. Earned Income Tax Credit (EITC): This credit allows qualifying low- and moderate-income workers and families to reduce taxes owed, potentially increasing a tax refund. The credit is based on various factors, such as adjusted gross income, filing status, dependents, and more, but could be worth $632 to $7,830 if eligible.
7. Illinois EITC: If you qualify for the federal EITC, you’re automatically eligible for the credit on your Illinois tax return, which is calculated at 20% of your federal credit.
8. Illinois Child Tax Credit: If you qualify for the Illinois EITC and have at least one qualifying child under age 12, you also qualify for the Illinois Child Tax Credit. The credit is calculated at 20% of your Illinois EITC amount.
9. Illinois K-12 Education Expense Credit: If you paid more than $250 in expenses (think tuition, books, and lab fees), you may be eligible for a 25% credit of your student’s qualifying education expenses, worth up to $750.
10. Illinois 529 College Savings Plan Deduction: Illinois allows parents to lower their taxable income by making tax-deductible contributions (up to $10,000 for individuals and $20,000 for joint filers) to state-sponsored 529 plans. Additionally, investments grow tax-free while in the plan.

While the costs of raising children will likely continue to rise, there are many tax credits and deductions available to help alleviate some of the financial burden. A CPA can help prepare and file your tax return to ensure all eligible credits and deductions are maximized. The Illinois CPA Society’s free “Find a CPA” directory can help you find the trusted, strategic advisor that’s right for you and your family based on location, types of services needed, and languages spoken. Find your CPA at www.icpas.org/findacpa.