It may be the first baby of the year who grabs the media headlines but it's the last baby of the year who yields the tax savings. Babies born before the stroke of midnight this New Year's Eve could save their parents thousands on their 2008 returns.

"Mere minutes can mean major tax savings this New Year's Eve," said Dave Keagle, district manager for H&R Block of Boulder. "Babies born on Dec. 31 provide parents with a retroactive tax exemption for all of 2008. To get that same tax break, parents of babies born after midnight on Jan. 1, will have to wait until they file their 2009 taxes - in 2010."

In addition to an exemption worth $3,500 in 2008, new parents may qualify to claim two other credits that could further reduce this year's tax liability.

The Child Tax Credit is worth as much as $1,000 per child, regardless of whether taxpayers file as a single or jointly. To qualify, parents must have earned income of at least $8,500. And, even parents without any tax liability may be eligible for this refundable credit.

The Earned Income Tax Credit is available to lower-income workers. The amount of the credit varies with income, the number of qualifying children and whether a single or joint return is filed. EITC is also a refundable credit so it can reduce a taxpayer's liability below $0, resulting in a refund.

For future years, taxpayers who pay someone to look after their baby while they work or look for work may qualify for the Child Care Credit. Income limitations apply to this tax benefit so a tax or financial professional should be consulted about individual tax situations.

The H&R Block offices in Boulder congratulate Gemma and Blake Williams along with Gretta Willis, the parents and grandmother of Zack Rocky Williams, who was delivered at Boulder Community Hospital and was Boulder's last baby born in 2008.