The tax joys of parenthood

Is there a new baby in the house? That's good news, especially at tax time.

A growing family makes you eligible for a variety of tax savings. You get an additional tax exemption, which in 2012 is worth $3,800 for each of your dependents. Exemptions are like deductions: They whittle down your taxable income which generally results in a lower tax bill.

You may also be eligible for some tax credits, which reduce your tax liability on a dollar-for-dollar basis. The child tax credit, worth $1,000 for each child younger than 17, is the easiest credit to claim. If you have more than one child, you may be eligible for the additional child tax credit, which allows filers who owe little or no tax to get a refund check from the IRS.

And if you put the kids in day care, you can recoup some of those costs, too � up to $3,000 for one child under 13 and $6,000 for two or more preteens.