How Much is the Child Tax Credit?
The child tax credit is worth up to $1,000 per child that is under 17. To be eligible to claim this credit your child or dependent must first pass all of the following tests:
- Must be 16 or younger on the last day of the year
- Must be a US citizen, US national, or a resident alien
- Must be claimed by you as a dependent
- Must be related to you by blood, or step relationship, or legally adopted child/foster child
- Must have resided with you for more than half of the year (special rules apply for special circumstances such as divorce)
- You must have provided them with more than half of their support
- The credit is worth a maximum of $1,000 per child
- Until 2017, the Child Tax Credit is partially refundable if your earned income was more than $3,000.
- The Child Tax Credit decreases if you have an AGI of $75,000 ($110,000 for married filers and $55,000 for separate filers).
- You must include foreign income exclusions when calculating your income for this specific credit.
The Additional Child Tax Credit
The Additional Child Tax Credit (ACTC) is a refundable credit that taxpayers who receive a larger child tax credit than their income owned receive if their earned income is greater than $3,000.
Form 1040 (Schedule 8812) helps determine if you qualify and the amount of the credit that you will receive. If you e-file your return the software will do all of the math for you.
Dependents on Multiple Returns
Only one taxpayer or couple can claim the child for the Child Tax Credit and ACTC. If more than one person tries to claim the child, the IRS will determine who gets to claim the child using the tiebreaker rules.
- Exemptions – Receive the standard exemption for each child that qualifies.
- Child and Dependent Care Credit – You could deduct up to $3,000 for one dependent, or up to $6,000 for more than one with this credit.
- Adoption Tax Credit – If you have already adopted or are in the process, you may qualify for this credit.
- Filing Status – If you are unwed and your child resided with you for more than half of the year, you could qualify for a higher standard deduction and lower tax rates with the Head of Household filing status.
Claiming the Child Tax Credit
When you eFile with a service such as Turbo Tax, you automatically are asked the right questions to determine if you qualify for the Child Tax Credit.