Why am I not getting the child tax credit? My return came to zero even though I had a baby in 2023

[09a44443e0df]

I only worked the month of December and it’s my first child and I’m married filing separately

[CatinaT1]

You need to have taxable income to receive the child tax credit. It may be that your income is too low to qualify for the credit.  

  

You may qualify for the "additional child tax credit" if you don't qualify for the normal credit of $2,000 per child. 

You can see a summary of your tax return while in TurboTax by doing the following: 

  

1. Find the "Tax Tools" option on your left menu bar and click on it 

2. Click on "Tools" 

3. Click on "View Tax Summary" 

  

This will allow you to see if you have any income tax or credits. 

  

These links will provide more information: 

Child Tax Credit 

Additional Child Tax Credit 

[DoninGA]

To be eligible for the child tax credit you must have at least $2,500 of earned income from work.

For a child born in 2023 you need to enter that they lived in your home for the Whole year.

[xmasbaby0]

You probably did not have enough income from working to get the refundable  additional child tax credit --which is based on how much you earned from working.  You say you only worked for a month in 2023.  And...if you are filing married filing separately, you are not eligible to get earned income credit.

The tax laws changed for child-related credits and are much less generous for 2022 and 2023.

Make sure you have entered your child as a dependent in My Info, and that you have entered the child's Social Security number.    Careful— do not say that your child’s SSN is not valid for employment.  If your child was born in 2023 make sure you said he lived with you the whole year.  There is an oddly worded question that asks if the child paid over half their own support.  Say NO to that question.

Have you entered income from working in 2023?  If not,  you will not receive an income tax refund based on having dependent children.

The rules for getting the child tax credit on a 2021 tax return and now on a 2023 return are very different.  For 2021 you could get $3600 for a child under 6 or $3000 for a child between 6 and 17 even if you had no income/did not work.   That is NOT the way it will work for your 2023 tax return.  The “old” rules are back. 

  The maximum amount of the child tax credit is now $2000 per child; the refundable “additional child tax credit” amount is $1600.   In order to get that credit, you have to have income from working.  The credit is calculated based on the amount you earned above $2500 multiplied by 15%, up to the full $1600 per child. If the amount you earned was too low, you will not get the full $1600.

 If your child is older than 16 at the end of 2023, you do not get the CTC.  But you may still get the non-refundable $500 credit for other dependents instead.

https://ttlc.intuit.com/questions/1900923-what-is-the-child-tax-credit

https://ttlc.intuit.com/turbotax-support/en-us/help-article/taxation/additional-child-tax-credit/L6x...

https://www.irs.gov/help/ita/does-my-childdependent-qualify-for-the-child-tax-credit-or-the-credit-f...

And for the Earned Income Credit—-the rules are back to the “old” rules—

Those under 25 and over 65 without children are not eligible as they were uniquely in 2021.   And you cannot use your income from any earlier tax year to get the EIC for a 2022 return.  There is no “lookback” for 2023.  EIC for 2023 will be based on the income you earned by working in 2023.

https://ttlc.intuit.com/questions/1899157-what-are-the-qualifications-for-the-earned-income-credit-e...

https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/use-the-eitc-assistant

Look at your 2023 Form 1040 to see the child-related credits you received

PREVIEW 1040

https://ttlc.intuit.com/questions/1901539-how-do-i-preview-my-turbotax-online-return-before-filing

Child Tax Credit line 19

Credit for Other Dependents line 19

Earned Income Credit line 27

Additional Child Tax Credit line 28

AND….If you have children but had  little or no income, it raises the question of how you and the children were supported.  There may be another tax-paying adult who can claim you and/or the children as dependents.  

[xmasbaby0]

@09a44443e0df Why are you filing married filing separately?  That is usually the worst way to file---and you lose child-related credits by filing that way.

If you were legally married at the end of 2023 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $27,700 (+$1500 for each spouse 65 or older)  You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return.

 Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI)

 If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice since with online, you get one return per fee.

https://ttlc.intuit.com/questions/1894449-married-filing-jointly-vs-married-filing-separately

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states

https://ttlc.intuit.com/questions/1894449-is-it-better-for-a-married-couple-to-file-jointly-or-separ...

[JulieS]

Yes, using the Married Filing Separately (MFS) filing status doesn't prevent you from getting the Child Tax Credit (CTC), but it'll reduce the amount you can get by half. In addition, MFS prevents you from getting Earned Income Credit (EIC) and many other deductions and credits.

As Xmasbaby points out, you may be better off filing jointly, but of course, that's not always an option. 

You should review the questions you answered about your child to see why there's no CTC. Here's how to do that:

1. Sign in to your TurboTax account.
2. Select  My info, then Edit.
3. Select the down arrow to the right of your child's name, then Edit.
4. Select My child.
5. Make sure you have a first name, last name, date of birth and that you have selected US citizen or legal resident from the dropdown at the bottom. 
6. Since your child was born during 2023, you need to select Yes to Did (Name) live with you for the whole year? 
7. Since you are filing separately, you will be asked about your child's other parent. If you live with the other parent and they have a higher income, you can't claim your child as your dependent, so you won't get the CTC. 
8. Answer the rest of the questions based on your situation.
9. If your child doesn't have a Social Security number yet, you won't get the CTC. 
10. At the end of the section, you should see either Good news! (Name) qualifies as your dependent, or an explanation of why they do not. 

If you still have questions about the CTC after reviewing this section, reply back and TurboTax can help you further.