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Credits and Exemptions for Children

The Earned Income Tax Credit, Child Tax Credit (CTC), Additional Child Tax Credit (ACTC), and the dependent exemption all provide benefits to families
with children. In 2009, a single mom (or dad) with two children can receive benefits ranging from $0 to about $7,500 – depending on her income, age of the children,
and where the children live. While this assistance is extremely important to many low-income families, they
must navigate a bewildering set of rules to take full advantage of the credits. Due to the piecewise implementation of these credits and exemptions, total benefits bounce around erratically as income grows.

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