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Level 2
May 26, 2024
Question

ACTC for expats

  • May 26, 2024
  • 1 reply
  • 16 views
My wife and I live with our 4 children all under 16 outside of the US. We are all US citizens. We have no tax liability in the US. I believe that we still qualify for the ACTC (last year we paid a CPA to do out taxes, we were in the same situation, and we received the ACTC). TT says "since the Additional Child Tax Credit is a refundable credit, but your tax return did not show any earned income, you did not meet that credit's $2,500 minimum earned income requirement." Of course, we have income that is reported, it just is not taxable. How do I get around this?

1 reply

Hal_Al
Level 15
Level 15
May 26, 2024

"ACTC is not allowed if you or your spouse (if filing a joint return) file a Form 2555 or Form 2555EZ (excluding foreign earned income)."

https://www.eitc.irs.gov/other-refundable-credits-toolkit/what-you-need-to-know-about-ctc-and-actc/what-you-need-to-know

Level 2
May 26, 2024

Right. So TT is guiding me to use 2555 instead of 1116 (foreign tax credit). In the past I have used 1116. How do I guide TT to use 1116 instead of 2555?

Hal_Al
Level 15
Level 15
May 26, 2024

You may want to do a new post with that specific question.