Amending my 2022 and 2023 tax return to include my child's SSN for child tax credit

[ibrahimtorunergil]

Hi all, I have an L1 working visa. I filed my 2022 (with extension) and 2023 tax returns (without extension). For the child tax credit, since my daughter didn't qualify for SSN at the time, TurboTax led me to apply for ITIN because I included the child tax credit in my tax return. Along with my tax return, I included a W-7 form to request ITIN for my child. There were a few back-and-forth mails between me and the IRS on the additional evidence for my child's ITIN. Even though I provided everything the IRS asked for, they didn't issue ITIN for my child (I know other L1 visa holders whose children have ITIN). I was made to apply for my child's ITIN 4-5 times from scratch. Even local IRS office employees were perplexed that my child wasn't issued ITIN and couldn't confirm why. Due to a recent status change, my child got SSN. Can I amend my 2022 and 2023 tax returns to include/update SSN and claim the child tax credit today?

[xmasbaby0]

No.   Sorry---you cannot amend to get the child tax credit for a time before your child had a SSN.   With an ITIN, you were only eligible to get the $500 credit for other dependents for those tax years.   Going forward, if your child has a SSN and is under the age of 17, you may be able to get the child tax credit.

[ibrahimtorunergil]

Thank you. I believe that it was IRS's negligence that my child's ITIN wasn't issued. Somehow, if my child gets ITIN later, can I then retroactively amend my child to claim the child tax credit in the 2022 and 2023 tax returns or does the situation in your response still apply?

[xmasbaby0]

Sorry--the tax law disallows getting the child tax credit retroactively.    You cannot get the child tax credit with an ITIN.   You can only get it for a child with a SSN.   If your child has a SSN now, you may get the CTC on your 2024 return.

[Opus 17]

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@ibrahimtorunergil wrote:

Thank you. I believe that it was IRS's negligence that my child's ITIN wasn't issued. Somehow, if my child gets ITIN later, can I then retroactively amend my child to claim the child tax credit in the 2022 and 2023 tax returns or does the situation in your response still apply?

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If you did not claim your child at all, you can file a return to add them as a dependent and claim a $500 credit for "other dependent."  However, to claim the $2000 child tax credit, or to qualify for EIC, you must have the SSN when you file an "on time" tax return.   If you already claimed the $500 credit for "other dependent", you can't improve on that. 

Be aware that if you prepare an amended return, Turbotax will most likely add the full $2000 child tax credit, but the IRS will reduce it when they process your return.  

[Opus 17 · Accepted solution]

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@xmasbaby0 wrote:

Sorry--the tax law disallows getting the child tax credit retroactively.    You cannot get the child tax credit with an ITIN.   You can only get it for a child with a SSN.   If your child has a SSN now, you may get the CTC on your 2024 return.

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I think some qualification is needed here.  If the dependent exemption was completely disallowed, the taxpayer can file an amended return and should get the $500 credit for "other dependent" -- that is allowed if the child only has an ITIN.  However, if the taxpayer already got the $500 credit for other dependent, you are correct that can't be improved to the $2000 child credit retroactively.  To claim the $2000 child tax credit (and also qualify for EIC), the child must have a valid SSN before the due date of a timely filed return.  

[AmeliesUncle]

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@Opus 17 wrote:

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 If the dependent exemption was completely disallowed, the taxpayer can file an amended return and should get the $500 credit for "other dependent" -- that is allowed if the child only has an ITIN.  

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That needs to be received before the due date of the return as well.  See §24(e) [which covers both the $2000 credit and the $500 credit].

[Opus 17]

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@AmeliesUncle wrote:

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@Opus 17 wrote:

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 If the dependent exemption was completely disallowed, the taxpayer can file an amended return and should get the $500 credit for "other dependent" -- that is allowed if the child only has an ITIN.  

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That needs to be received before the due date of the return as well.  See §24(e) [which covers both the $2000 credit and the $500 credit].

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I don't think so.  24(e) applies to qualifying child dependents. 

No credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the name and taxpayer identification number of such qualifying child...

24(h) contains the $500 other dependent credit.   Look at 24(h)(4) and 24(h)(7)

24(h)(4)(C) In the case of any qualifying child with respect to whom a credit is not allowed under this section by reason of paragraph (7), such child shall be treated as a dependent to whom subparagraph (A) applies.

24(h)(7) No credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the social security number of such child...

In other words, if you don't get the credit because of the social security number requirement in (h)(7), you get the $500 credit in (h)(4)(A).

[AmeliesUncle]

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@Opus 17 wrote:

24(h)(4)(C) In the case of any qualifying child with respect to whom a credit is not allowed under this section by reason of paragraph (7),

The credit isn't being disallowed due to "7" (having a valid Social Security Number).  It is being disallowed due to "e" (not having an identification number, either a SSN or an ITIN, by the due date).

[AmeliesUncle]

... okay, I think you may be saying to claim the child is not a Qualifying Child, but only a non-child dependent?  Hmmm, I'll need to think about that and re-read things.

[ibrahimtorunergil]

I have a wife and a child (a 2-year-old toddler) and no other dependents. Before the due-date of the return, my child didn't have ITIN or SSN. However, Turbotax included the child tax credit, saying that I cannot do e-file rather I can print out the forms/return and go to IRS local office and apply for ITIN for my child. At the time of the ITIN application, I also attached my return and submitted to IRS. IRS rejected my child ITINs application and deducted the child tax credit and wired me the rest of the refund. At the same time, in ITIN rejection letter, IRS asked for more support/evidence and wanted me to re-apply for child ITIN. Of course, if you apply for ITIN (7-W), it asks you to submit the most recent tax return which I attached to my 2nd ITIN application. 2nd ITIN application got rejected for no reason again. In summary, I didn't get any credit. Somehow, my child got SSN (due to status change) this year. I was wondering if I apply ITIN and get the ITIN, can I amend my prior year tax return to claim $500/$2000 child tax credit. All the replies sound negative to me. Thanks again for your time!

[AmeliesUncle]

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@ibrahimtorunergil wrote:

Somehow, my child got SSN (due to status change) this year. I was wondering if I apply ITIN and get the ITIN, 

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If your child now has a SSN, you are not eligible to apply for an ITIN.

[AmeliesUncle]

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@Opus 17 wrote:

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I don't think so.  24(e) applies to qualifying child dependents. 

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At least in this case, the child appears to a Qualifying Child.  The $500 credit is for a dependent "other than" a Qualifying Child as described in (c).  That means that (e) still applies, so they need their ID number before the due date of their return.

Coincidently, I just saw there is a post on TaxProTalk about if the ODC needs ANY kind of identification number.

[Opus 17]

@ibrahimtorunergil 

Your story is what I would expect.  If your child was not eligible for an SSN, and you were only applying for an ITIN in 2022, then the most you would get is $500, regardless of what Turbotax tried to claim.  (The program may have a blind spot here.)   The IRS denied the $500 credit because they denied the ITIN.

@AmeliesUncle  and I have a different interpretation of the code.  It it my understanding that you can file an amended return, add your child, and claim the $500.  In this case, you would use the SSN, since it is already issued.  Again, Turbotax may try to claim $2000 for you, but the IRS would look at the issue date of the SSN and automatically reduce it to $500.  But I believe you should get the $500.

The other problem you will have is that the tax data file you currently have probably already claims the child, so turbotax won't see anything to amend.  You need to start by preparing new 2022 and 2023 returns that leave off this child.  Mark the returns as "filed" by printing a copy, so the program thinks you filed (but don't actually send it in).  Then save your work, close, reopen the return, click "Amend" to start amending, and add this child with their SSN.  That will prepare an amended return that you can mail to the IRS.  But remember that even if Turbotax tries to claim $2000 for the child, you should expect to get $500.  

[AmeliesUncle]

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@Opus 17 wrote:

I have a different interpretation of the code.  It it my understanding that you can file an amended return, add your child, and claim the $500.

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The Instructions for Form 8812 and the Internal Revenue Manual disagrees with your interpretation:

"If you have a dependent who does not have an SSN, ITIN, or ATIN issued on or before the due date of your 2023 return (including extensions), you can’t use that dependent to claim the ODC on either your original or an amended 2023 return."

https://www.irs.gov/instructions/i1040s8#en_US_2023_publink100077546

"A person qualifies for ODC if the following conditions are met: ... The dependent must have a valid ITIN, SSN, or ATIN issued on or before the due date of the return (including extensions)."

https://www.irs.gov/irm/part21/irm_21-006-003r#idm140052992097040