the 2025 tax season is here, and it's a big one. here's a rundown of the key changes and ways to save this year, including an increase in the multi-child credit, expanded home improvement savings deduction, and a new pool fee deduction.

summary Beginning with the 2025 tax year, the credit for families with multiple children will increase by $100,000 per child, and new deductions for home improvement savings and gym memberships will be available. the hometown donation limit has also been raised to 20 million won, opening up even more tax savings opportunities.

tax year 2025 changes at a glance

this year's tax season is different from previous years. this is because the government has expanded many deductions to address the declining birthrate and support the economy, especially for families with children.

tax season is the time of year when you reconcile your taxes for the year, and the deductions you take can make a big difference in how much you get back. Here's a look at what's new this year.

expanded Multi-Family Tax Credit

increased Child Tax Credit Amount

starting in 2025, the credit for children between the ages of 8 and 20 will increase by $100,000, depending on the number of children you have.

number of children existing credit amount new credit amount 1 child 150,000 250,000 2 people 350,000 won 55 3 persons 65만원 95 4 persons 95만원 135,000 won

for families with three or more children, the base rate is 550,000 won, plus 400,000 won for each additional child. The more children you have, the greater the tax savings.

additional deduction for children with disabilities

if you have a child under the age of 9 who receives developmental rehabilitation services, you can receive an additional deduction of 2 million won. you don't need to register the child's disability, just submit proof of use.

small Business Reemployment Tax Credit

if you retired to raise your children and rejoined a small business after March 14, 2025, you can get a 70% income tax reduction for three years from the date of reemployment. The same applies if you retired to care for an immediate family member who is 70 years old or older or disabled.

you may also be interested in these articles: A complete guide to the multiparent tax credit, The details of the small business reemployment tax credit, and A complete guide to the tax credit.

learn more about the expanded credit

expanded Homeownership Savings Tax Credit

the home equity savings deduction for workers earning up to 70 million won in gross salary will be expanded. previously available only to heads of households without homes, spouses of heads of households without homes can now receive the deduction if they earn a gross salary of KRW 70,000 or less.

item description who is eligible heads of household and spouses income requirements gross salary of $7,000 or less deduction Limit annual contribution of KRW 3 million deduction Rate 40 percent maximum deduction 1.2 million won

new deduction for pool and gym fees

there's a new 30% deduction for pool and gym fees paid on or after July 1, 2025. this is great news for anyone who uses a gym or pool to stay fit.

expanded Hometown Charitable Contributions Deduction

the annual donation limit for the Hometown Love Donation has been significantly increased from KRW 500,000 to KRW 20,000. The excess of KRW 100,000 donated to special disaster areas will be deducted at a 30% rate, but only if the donation is made within three months of the declaration of a special disaster area.

category existing changed annual donation limit 500,000 KRW 2,000 million won special Disaster Area Deduction Rate not applicable 30

frequently Asked Questions

Q1. How old can I claim the child tax credit?

A1. Children between the ages of 8 and 20 are eligible. the age is based on the child's age on December 31 of the year.

Q2. How do I claim the additional disability credit for a child who receives developmental rehabilitation services?

A2. You can submit a certificate for developmental rehabilitation services at the end of the year. you don't need to register for a separate disability, so it's easy to prepare.

Q3. Will the swimming pool deduction apply from January 2025?

A3. No, it will apply to expenditures made on or after July 1, 2025. please note that expenditures in the first half of the year are not deductible.

Q4. Does the 30% special disaster area deduction for the Hometown Love Donation apply to all donations?

A4. The 30% deduction rate applies only to the portion of donations exceeding KRW 100,000 made within three months of the declaration of a special disaster area.

Q5. Under what circumstances is the SME reemployment tax reduction applicable?

A5. If you are reemployed by a SME after March 14, 2025, after retiring to raise children or care for an immediate family member who is 70 years old or older or disabled, you will receive a 70% income tax reduction for three years.

wrapping up

the Tax Cuts and Jobs Act of 2025 has a lot to offer, with an expanded credit for families with multiple children and a variety of new deductions, so be sure to check out what applies to you and make sure you don't miss out on anything so you can enjoy a bigger paycheck in March.

let us know if you have any questions about tax season in the comments. and don't forget to subscribe to our blog for more helpful tax tips.