Income tax child benefit exists for families who have children under age 16 or disabled children. They can claim this income tax allowance only if their child benefits are less than full exemptions allowed under German law.

Parents who have a child or children in school or vocational training can receive an education tax allowance from 920 to 2147 Euros per child per year. They may also get public educational grants.

If a single parent gets one of the child-related tax benefits or allowances, they may also get a household tax allowance.

A German policy called "income splitting" gives tax advantages to families with one high-earning and one low-earning spouse. Income splitting gives a disadvantage to dual-earner families with two somewhat equal wages. Under this policy, part-time workers can only earn up to certain amounts in both East and West Germany before they have to make contributions to the health care and pension systems. When part-time workers go over this set limit, they face a large tax. This discourages part-time workers (who are mainly women) from working to earn more than that set limit.