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What are the Income Limits for the Child Tax Credit?
The Child Tax Credit is a credit that can be claimed by taxpayers who have qualifying children.
The credit can be worth up to $2,000 per child, and it can be used to offset taxes owed. The Child Tax Credit limit is $75,000 for single filers and $110,000 for joint filers.
Taxpayers who have income above these limits may still be able to claim the credit, but the credit amount will be reduced.
The credit begins to phase out at AGI levels above these amounts. It is eliminated at AGI levels of $95,000 for single filers, $135,000 for head-of-household filers, or $170,000 for joint filers.
Some have proposed increasing the child tax credit limit threshold to help offset the cost of raising children.
The credit is refundable, and taxpayers can receive a refund if the credit exceeds their tax liability.
Who Is Eligible for the Child Tax Credit?
The Child Tax Credit is a credit available to taxpayers with dependent children under the age of 17. To be eligible for the credit, the taxpayer must have a valid Social Security Number for each child.
The credit is worth up to $2,000 per child and can be used to offset any tax liability the taxpayer owes.
To qualify and claim the Child Tax Credit, taxpayers must have an adjusted gross income of less than $75,000 for single filers or $110,000 for joint filers.
The credit begins to phase out at these income levels, and it is completely eliminated when a taxpayer’s income reaches $95,000 for single filers or $145,000 for joint filers.
In addition to meeting the income requirements, taxpayers must also meet certain other criteria in order to claim the Child Tax Credit.
- The taxpayer must have a Social Security number for each child. (The credit is not available if the child is not a U.S. citizen.)
- The taxpayer must have paid income taxes to claim the credit.
- The taxpayer must be able to claim a child as a dependent. If one parent claims the child as a dependent, then the other parent is required to sign Form 8332, Release of Claim to Exemption for Child by Custodial Parent, to allow that parent to claim the credit.
How much is the credit worth?
The Child Tax Credit is worth up to $2,000 per qualifying child. To receive the maximum credit, your household income must be below $200,000 (or $400,000 for married couples filing jointly).
The credit is gradually reduced for households with incomes above these amounts.
For example, a family with two children and an income of $110,000 would get a credit of $1,400. A family with the same number of kids and an income of $230,000 would get a credit of just $200.
The Child Tax Credit can make a big difference for families struggling to make ends meet.
If you think you might qualify for this fully refundable credit, be sure to talk to a tax professional or use the IRS’s online resources to learn more.
How do I calculate my child tax credit?
As a parent, you may wonder if you qualify for the child tax credit. The good news is that there is a child tax credit calculator that can help you determine if you qualify.
To calculate the child tax credit, you will need to provide your filing status, the number of children under the age of 17, and your adjusted gross income.
The child tax credit calculator will then give you an estimate of the amount of the credit you may receive.
In general, to qualify for the child tax credit, your adjusted gross income must be less than $75,000 for single filers or $110,000 for joint filers.
You must also have at least one qualifying child who is under the age of 17 and who is a dependent on your taxes.
Can You Get the Child Tax Credit if You Have No Income?
Parents with low or no income may still be able to receive the child tax credit. The credit is based on the parent’s income, so if a parent has little to no income, they may still qualify.
Other factors can affect whether or not a parent qualifies, such as the number of children they have and their filing status.
What about monthly child tax credit payments?
The American Rescue Plan of 2021 provided eligible taxpayers with up to half of the 2021 Child Tax Credit in advance payments.
As of 2022, the child tax credit has been reduced to $2,000 per child under the age of 17, with no advance monthly payments.
According to the Center on Budget and Policy Priorities, the 2021 expanded child tax credit helped reduce child poverty by about 30% as of December, as measured by monthly income.
How do I claim the child tax credit?
If you have qualifying children and meet the other requirements, you can claim the credit when you find your W2 and file your taxes.
To claim the credit, you must fill out Form 1040 or Form 1040-A and include Schedule 8812 with your tax return. The Child Tax Credit is a valuable tax credit worth up to $2,000 per qualifying child or dependent.
To claim the credit, you must have a filing status of married filing jointly, head of household, or qualifying widow(er) with a dependent child.
You must also have a Social Security Number for each qualifying child. If your income is above the limit for your filing status, you may still be able to claim a partial credit.