Congress Extends Earned Income Tax Credit

The 'fiscal cliff' deal passed by both houses of Congress provides a five-year extension of the earned income tax credit — an important one for lower income families. It also extended the child tax credit.

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DAVID GREENE, HOST:

Let's begin NPR's business news with some fiscal deal details.

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GREENE: You might remember over the holiday season, we delved into some of the tax credit lawmakers were considering changing as part of a deal to avoid the fiscal cliff. We called it our 12 Days of Deductions.

Well, now with Congress giving the green light to an agreement that avoids widespread tax increases, we know where some of those credits stand. The deal provides a five-year extension of the earned income tax credit - that's an important one for lower income families. It also extends the child tax credit.

The law passed last night also provides a tax credit of up to $2,500 for college tuition.

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