To qualify for the Child Tax Credit, your child must fit all of these requirements:
- Be under age 17 at the end of the tax year
- Is your son, daughter, stepchild, foster child, adopted child, brother, sister, stepbrother, stepsister, half-brother, half-sister, or a descendant of any of them (for example, a grandchild, niece, or nephew)
- Has his or her own Social Security Number
- Children with ITINs don't qualify, but may instead be eligible for the $500 Credit for Other Dependents
- Lived with you for more than half the year
- Didn't support him/herself (i.e., didn't pay more than half their own expenses)
- Is a U.S. citizen, U.S. national, or U.S. resident alien
- Residents of Canada or Mexico wouldn't qualify
Up to $1,400 of the credit is refundable and is phased-in based on your earned income. In most cases, you must have $2,500 or more of earned income to be eligible for any portion of the refundable Child Tax Credit.
The $2,000 per-child credit is reduced once your AGI reaches $200,000 (or $400,000 if you're filing jointly with your spouse).
The most likely reason would be that the child is not completely entered in the My Info section
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Can someone please clarify why my children don't qualify? I was on unemployment most of the year and made about $22,000 for the year. I don't understand why I shouldn't receive the Child Tax Credit. I have 2 children under 17.
@wylkat54 Are you asking about getting the child tax credit on your 2020 tax return? You do not get the child tax credit on your tax return if you did not have income earned from working--unemployment is not earned income. There was a 2019 "lookback" provision that would have allowed you to use the earned income on your 2019 return to get the ctc on your 2020 return if you chose to do so.
Have you filed your 2020 return already?
Many people had lower incomes during the pandemic in 2020 due to reduced work hours, layoffs, etc. Or they received unemployment benefits. These factors affect how much earned income credit and additional child tax credit you can get on your 2020 tax return and affect your 2020 refund.
There is a “lookback” option that allows you to use your 2019 amounts for earned income credit or child tax credit. You can choose whether to use your 2019 amount or your 2020 amount. Choose whichever amount gives you a better tax refund for your 2020 refund.
You can see this and choose in the earned income credit section in Deductions and Credits.
You still MUST enter all of your 2020 income into your 2020 tax return, including any unemployment you received.
Please follow these steps in TurboTax:
- Login to your TurboTax Account
- Click on the Search box on the top and type "EIC"
- Click on “Jump to EIC”
- Answer the questions until you reach the screen "Do you want to use last year’s earned income?"
- Note your current refund amount using your 2020 earned income at the top of the screen.
- Click "Yes", enter your "2019 Earned Income" if the field is blank and click "continue".
- Compare the new refund amount using your 2019 earned income with the previously noted refund amount using your 2020 earned income.
If you already filed then you can amend your 2020 return AFTER it has already been fully processed.
Select your tax year for amending instructions:
Do not amend your tax return until the original return has been fully processed.
If you are asking about the monthly child tax credit payments, the IRS can use your 2019 or 2020 return to issue those monthly payments---and you do not have to have earned income to get the credit which is an advance on the credit you can get for 2021. If you do not get the monthly payments you can still get the ctc payments on your 2021 tax return if you are eligible.
"small income from work" is probably the issue ... see if the LOOK BACK option will help ...
There are 6 possible reasons; you aren’t getting the Child Tax credit (CTC). It’s usually #4:
- You’ve entered something wrong. In the personal Info section, for the dependent, you must select answers that indicate that he/she is your dependent child. If the child was born during the year, say he/she lived with you all year (note: TurboTax changed how this section is done two years ago, you may need to go thru the interview again or even delete your dependent and start over). If the child was born in 2018, you have to answer that he lived with you all year. The CTC is not an automatic $2000, per child. It is income dependent. If you haven't entered your income yet, the CTC will not show.
- Your child may be too old (over 16). You can still claim your child. What you can't claim is the Child tax credit. This comes as a big surprise to many parents the year their child turns 17. A child over age 16 no longer qualifies for the Child Tax credit (CTC). Although a child can still be a student dependent through age 23, and a qualifying child for EIC, the Child Tax Credit expires the year they turn 17 and you no longer get the $2000 CTC.
- Your income is too high. The Child Tax Credit (CTC) is phased out at higher incomes starting at $400,000 for joint filers ($200K single). You lose $50 for each $1000 (rounding up) your income is over that threshold.
- Your income is too low. The child tax credit (CTC) is also limited to your tax liability. The CTC is a non-refundable credit and can only reduce your income tax to 0, It can not help you beyond eliminating your tax liability. But, if you have more than $2500 of earned income, some or all of it is usually given back to you thru the "Additional Child tax credit". The ACTC is calculated on form 8812 and is basically 15% of your earned income over $2500. The ACTC is a maximum of $1400 per child (not $2000).
- You are the custodial parent and the non-custodial parent is claiming the dependent this year. The CTC goes with the dependency, even though the custodial parent still gets the Earned Income Credit, Dependent care credit and Head of Household.
- Another possibility is that part of your tax due is not regular income tax, but is self-employment, early distribution penalty or another type of additional tax, for which the CTC cannot be used.
Went back and looked at return, wrong info in above post. Had 21K in earnings and 14K in unemployment. I must have filled something out wrong, I just don't know where. And don't know where to look.
Review form 1040 lines 19 & 28 plus the form 8812 for the calculation of the CTC & ACTC.
If you have not yet filed then I would delete the dependent in the my info section then enter them again and complete the deductions & credits section again.
How do I preview my TurboTax Online return before filing?
You can view your entire return or just your 1040 form before you e-file:
- Open or continue your return.
- Select Tax Tools in the left menu (if you don't see this, select the menu icon in the upper-left corner).
- With the Tax Tools menu open, you can then:
- Preview your entire return: Select Print Center and then Print, Save, or Preview This Year's Return (you may be asked to register or pay first).
- View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu.
Yes but you MUST wait for the original return to be fully processed including the recalculation of the unemployment exclusion if you filed early.
Go to the following link for instructions to amend a 2020 tax return that you filed with TurboTax.
Before you start to amend your return in TurboTax Online, be sure to download a PDF of your original tax return and save it on your own computer. Once you amend it, you will no longer be able to access the original in TurboTax.
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