Claiming the Child Tax Credit

The Child Tax Credit is a credit available to taxpayers for each dependent child, under the age of 17 at the end of the tax year. You can deduct a maximum of $1000 per child, though there are limitations based on your adjusted gross income (AGI).

The CTC is not a reimbursement of funds, but rather a credit that can further reduce the amount of your taxable income. Not everyone is eligible to take this credit and you must meet both the eligibility and income criteria to qualify.

Eligibility

In order to be eligible to take this credit, you must have a qualifying child. A qualifying child must meet certain requirements:

1. They must be 17 years old or younger at the end of the tax year. year.
2. They must be your son or daughter, either naturally or through adoption or marriage, or a foster child, brother sister, stepbrother, stepsister or the progeny of any of these people. The qualifying child, must also have lived with you for the entire year as a member of the family.
3. The child must be a U.S. citizen, U.S. national or resident of the U.S.
4. You must provide more than half of the funds to support the child.
5. The child must have lived with you for more than half the year, although there are exceptions to this rule. See IRS Publication 972, p.2 for circumstances under which an exception can be made.

Limits on Income

Depending on your filing status and AGI the child tax credit may be limited, reduced or complete disallowed. The phase-outs for the CTC begin at:

·         $100,000 if Married Filing Joint

·         $55,000 if Married Filing Separately

·         $75,000 for Single, HOH and all others

In addition to the credit for a qualifying child, you may be able to take advantage of the Additional Child Tax Credit, if you owe less income tax than the amount of your Child Tax Credit. When this occurs, you may be able to generate a refund, despite the possibility that you have no tax liability.

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