You may pay the amount you owe in full. Your marginal tax rate refers to the rate at which the last dollars you earn in any year are taxed. Your marginal tax rate would be 46.4 per cent. Then your marginal tax rate would only be 34.6 per cent. A tax credit is a fixed amount that reduces the taxes payable to all taxpayers regardless of their income level, or marginal tax rate.
Refundable credits are always worth in real dollars what they're worth on paper.
If you didn't have to pay that money into the system, you get it back. Non-refundable tax credits, however, may be worth a lot less than the number you fill in on your tax return, right down to zero. This can happen if you have little, if any, federal tax to pay. What they can't do is get you a refund worth more than the tax you paid. A deduction is an expense or cost that can be subtracted from your income before your taxes are calculated.