New York State is encouraging millions of residents to take a closer look at their tax credits as the 2026 tax season begins. State officials say many taxpayers may qualify for valuable credits that could significantly increase their refunds, especially at a time when household budgets remain under pressure from rising costs.
New Focus on Tax Credits for 2026
As returns for the 2025 tax year are filed in 2026, the New York State Department of Taxation and Finance is highlighting two major credits that can provide direct financial relief. These are the Earned Income Tax Credit and the expanded Empire State Child Credit. Both credits are refundable, meaning eligible taxpayers can receive money back even if they owe little or no tax.
Earned Income Tax Credit Can Boost Refunds
The Earned Income Tax Credit is designed to support working individuals and families with low to moderate incomes. In New York, taxpayers earning below certain income limits may qualify. When combined with federal, state, and city versions of the credit, the total benefit can be substantial. For larger families, especially those with three or more qualifying children, the combined value can reach several thousand dollars, providing meaningful help with everyday expenses.
Expanded Empire State Child Credit
The Empire State Child Credit has been expanded for the 2026 tax season. The maximum credit for children under the age of four has increased significantly, offering greater support to families with young children. Full-year New York residents with at least one qualifying child under 17 may be eligible. This expansion reflects the state’s effort to help families manage childcare costs and other rising expenses.
Why Credits Matter More Than Deductions
Tax experts stress the importance of understanding credits versus deductions. A credit directly reduces the amount of tax owed, dollar for dollar, while a deduction only lowers taxable income. This difference makes credits far more powerful in increasing refunds. Reviewing eligibility each year is essential because income thresholds and rules can change.
Filing Carefully to Avoid Missing Benefits
Experts also warn taxpayers not to assume they qualify based on past returns. Even small changes in income or family circumstances can affect eligibility. Filing both federal and New York State returns accurately is key to claiming all available benefits. Taxpayers who skip reviewing credits risk leaving money unclaimed.
Deadline and Economic Impact
The tax filing deadline remains April 15 unless an extension is requested. With higher average refunds expected nationwide, many households may see increased spending power in the months ahead. For New Yorkers, these credits could help ease financial strain and provide some stability during uncertain economic times.
Disclaimer
This article is for informational purposes only and does not provide tax, legal, or financial advice. Tax laws, credit amounts, and eligibility rules may change. Readers should consult the New York State Department of Taxation and Finance, the Internal Revenue Service, or a qualified tax professional to confirm eligibility and obtain guidance specific to their situation.
