Credits and breaks for New York families: the $1,000 child credit, 30% EITC, and a child care credit rebuilt for 2026

New York pays families through the income tax return rather than through the deduction side of it. The dependent exemption is a modest $1,000 per child, and there is no state child deduction. The money is in the credits, and three of them are refundable to full-year residents: the Empire State child credit, which for 2026 pays $1,000 for each child under four and $500 for each child four through sixteen, up from $330; the New York earned income credit, 30% of the federal credit; and the child and dependent care credit, which the FY2027 budget rebuilt for 2026 as a percentage of expenses rather than of the federal credit. A Buffalo single parent earning $38,000 with a three-year-old and a seven-year-old owes New York about $1,100 before credits and collects about $3,100 of them, for a refund of roughly $2,000 beyond her withholding. New York City adds its own versions of two of the three.

The common thread is residency. The child credit, the refundable earned income credit and the college tuition credit all require a full year as a New York resident. A family that moves in during 2026 gets a prorated or nonrefundable version of some credits and nothing at all of others; the details are in Moving to New York.

The Empire State child credit

Form IT-213. For tax year 2026 the credit is $1,000 for each qualifying child who was under four on December 31 and $500 for each child four through sixteen. The child must meet the federal qualifying-child tests, and both the parent and each child need a Social Security number or an ITIN; New York, unlike the federal child tax credit, accepts an ITIN for the child. The credit is reduced by $16.50 for every $1,000 of federal AGI above $110,000 on a joint return, $75,000 for single, head of household or surviving spouse, and $55,000 married filing separately, so a joint filer with two children loses the whole $1,000 for a school-age pair at about $170,000 of AGI, and the $2,000 for two toddlers at about $231,000. The credit is fully refundable, and it is for full-year residents only.

The 2026 increase for school-age children, from $330 to $500, came in Chapter 59 of the Laws of 2025 and holds for 2027. The $1,000 for children under four began with 2025. A family with a newborn and a six-year-old gets $1,500 for 2026, against $1,330 for 2025.

The earned income credit

Form IT-215. The New York credit is 30% of the federal earned income credit, computed on the same federal figures, then reduced by any household credit taken on line 40. For a full-year resident it is fully refundable; a nonresident gets it only against tax, and a part-year resident gets a prorated refundable amount. A parent of two with a federal credit of $4,670 gets $1,401 from the state. Because the federal credit phases out at about 21 cents on the dollar for two children, and New York adds 30% of that, a $1,000 raise in the phase-out range costs about $273 of combined credit before any income tax.

New York City residents add a city earned income credit of 10% to 30% of the federal credit, the percentage falling as income rises, on the same form. And New York has a credit no other state offers: the noncustodial parent earned income credit on Form IT-209, for a full-year resident at least 18 years old whose child under 18 lived elsewhere, who had a child support order in effect for at least half the year and paid the full court-ordered amount. It is the greater of 20% of the federal credit the parent could have claimed with one qualifying child, or 2.5 times the federal credit for a worker with no children, and the Office of Temporary and Disability Assistance verifies the support payments automatically. A parent cannot take both this and the regular state credit.

The child and dependent care credit, rebuilt

Form IT-216. Through 2025 the New York credit was a percentage of the federal child and dependent care credit, 110% at low incomes sliding to 20% at New York AGI of $65,000 and above. The FY2027 budget replaced it, for tax years beginning in 2026, with a credit computed directly on expenses under new Tax Law section 606(c-2):

• Qualifying expenses are capped at $3,000 for one qualifying person, $6,000 for two, $7,500 for three, $8,500 for four and $9,000 for five or more, and at the earned income of the lower-earning spouse.
• The credit is 55% of capped expenses at New York AGI of $15,000 or less, falling as income rises to a floor of 4% (verify the slope; the budget summaries describe a reduction of 0.0025 percentage points per dollar above $15,000, which would reach the floor near $35,400 of New York AGI).
• Above $750,000 of New York AGI the credit is reduced a further $20 per $1,000 of income.
• The credit is refundable for full-year residents and generally unavailable to married couples filing separately.

The qualifying-person and provider rules are the federal ones from Publication 503: a child under 13, or a spouse or dependent unable to care for themselves, and care that let the parents work or look for work. The 2026 IT-216 and its instructions had not been published when this was written, so the percentage table is to come; what is clear is that 2025 software logic, a percentage of the federal credit, is wrong for 2026. New York City residents with a child under four and federal AGI of $30,000 or less add a city credit of up to 75% of the state credit.

Education: the 529 subtraction, the tuition credit

New York’s 529 College Savings Program. Contributions to New York’s own plan, the Direct Plan or the Advisor-Guided Plan, are subtracted on IT-201 line 30 up to $5,000 a year on a single return and $10,000 on a joint return. Other states’ plans do not count. The subtraction belongs to the account owner, so grandparents who want the deduction open their own account rather than contributing to the parents’. Withdrawals used for something New York does not treat as qualified are added back, and New York did not follow the federal expansion to K-12 tuition, so a withdrawal for private school tuition recaptures the earlier subtraction. At 5.4% the subtraction is worth $540 a year to a couple putting in the full $10,000.

College tuition credit or deduction. Form IT-272. A full-year resident who paid undergraduate tuition for themselves, a spouse or a dependent takes either a refundable credit of up to $400 per student or a New York itemized deduction of up to $10,000 per student, whichever is worth more; the form has a worksheet to compare them. Only tuition counts, not room, board, books or fees, and tuition paid from a 529 plan qualifies. The credit is small but refundable; the deduction is worth more to a family already itemizing on IT-196 at 5.9% or above, where $10,000 of tuition saves $590. Nonresidents and part-year residents may take only the deduction.

The smaller items

The household and real property tax credits reach few working families; they are listed because software asks about them. The alimony rule matters: a parent paying alimony under a 2020 divorce decree gets no federal deduction and a full New York subtraction.

Head of household

New York generally requires the same filing status used federally, so the federal head-of-household rules decide the state return too. The status is worth more in New York than in most states because the standard deduction rises from $8,000 to $11,200 and every bracket threshold widens by about half; a single parent with $50,000 of income pays about $255 less as head of household than as a single filer. Two quirks: a married person living apart from a spouse who qualifies for head of household federally may file that way for New York as well, and a joint filer whose spouse is a nonresident may have to file separately for New York even though the federal return is joint (verify).