what is the difference between tax credits and tax deductions 
tax credits and tax deductions both save you money at tax time but credits are more favorable tax credits lower the amount of tax you owe dollar for dollar while tax deductions reduce your taxable income for instance a 1 000 tax credit cuts 1 000 off your tax bill and a 1 000 tax deduction lowers your taxable income by 1 000 so if you fall into the 22 tax bracket a 1 000 deduction would reduce your tax bill by 220 