Tax Credit vs Deduction
A deduction lowers taxable income; a credit lowers your tax bill directly, so credits are usually worth more.
A deduction reduces the income you're taxed on, so its value depends on your bracket: a $1,000 deduction saves $220 for someone in the 22% bracket. A credit reduces your tax dollar-for-dollar: a $1,000 credit saves $1,000 regardless of bracket. That's why credits are generally more valuable than deductions of the same size.
Some credits are refundable (they can produce a refund beyond what you owed); others are non-refundable (they can only zero out your tax). Knowing the difference helps you understand which tax benefits move the needle most, and why advice often prioritizes capturing credits.
This definition is general information to help you understand a term, not financial, tax, or legal advice. Figures that change year to year (limits, thresholds, rates) should be confirmed against current official sources. For guidance on your situation, a licensed fee-only fiduciary is the right next step.