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What is the Child Tax Credit?

SOLVEDby TurboTax7148Updated 1 month ago

The Child Tax Credit is a tax credit you can claim for each qualifying dependent child on your return. You can get up to

  • $3,600 per qualifying child under 6
  • $3,000 per qualifying child age 6–17

if your modified adjusted gross income (AGI) is less than,

  • $150,000 if you're Married Filing Jointly or a Qualifying Widow
  • $112,500 if you're filing as Head of Household, or
  • $75,000 if you're Married Filing Separately or Single

If your AGI is higher than the amounts listed above, the amount of Child Tax Credit you're eligible for is reduced ("phased out") by $50 for each $1,000 your modified AGI is above the income threshold. For example, if you're Married Filing Jointly making $151,000 and your child is under 6, you’re eligible for a total credit of $3,550. 

You’ll still qualify to receive $2,000 per child until your modified AGI in 2021 exceeds

  • $400,000 if married and filing a joint return; or
  • $200,000 for all other filing statuses

To qualify, your child must meet all of these requirements:

  • Be under age 18 at the end of the tax year
  • Is your child, stepchild, foster child, adopted child, sibling, step sibling, half sibling, or a descendant of any of them (for example, a grandchild, niece, or nephew)
  • Has their own Social Security Number
  • Lived with you for more than half the year
  • Didn't support themself (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 don't qualify

The Child Tax Credit is also fully refundable. Meaning that you’re eligible for the credit even if you don’t owe taxes.

Received advance payments last year?

The IRS distributed advances of your Child Tax Credit amount for this year, as payments last year. They estimated how much total Child Tax Credit you’re eligible for based on your last return, split that amount in half, and sent it in monthly payments. So now that you’re filing your taxes, you’ll get the remaining amount. While the credit you get on your return now might seem smaller, remember that you already got some of the credit as advance payments.

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