Child Tax Credit (CTC) is a tax benefit available to taxpayers with a qualifying child under the age of 17. It is designed to help families ease the financial burden of raising children by supplementing families’ ‘ earnings and making benefits available to new families.
How Much is Child’s Tax Credit (CTC) 2024
For the 2024 tax year to be filed in 2025, families are eligible to a maximum of $2000 credit for each qualifying child. A portion of this tax benefit, known as the Additional Child Tax Credit (ACTC), is refundable. For the 2023 tax year, the refundable portion stands at $1,600 ; this figure has increased to $1,700 in the 2024 tax year.
Eligibility Requirements: who is eligible for Child Tax Credit?
The Child Tax Credit is only beneficial if you have a qualifying dependent(s). To be a qualifying dependent for the 2024 Child Tax Credit (CTC), your child must:
- Be under 17 by the end of the tax year
- Be your son, daughter, brother, sister, stepchild, foster child, stepsister, stepbrother, half-sister, half-brother, or a descendant of one of these (for example, a grandchild, niece or nephew)
- Be claimed as a dependent on your tax return
- Have lived with you for at least half a year
- Be a US citizen, national or resident alien
- Have a valid Social Security Number (SSN) by your tax return due date
- NOT file a joint tax return with their spouse for the tax year
As a taxpayer, are eligible to claim the full amount of the 2024 Child Tax Credit if your child meets the eligibility qualifications for a qualifying dependent (listed above).
Also, your annual income must not be more than $200,000—or $400,000 if filing a joint tax return. Parents and guardians with a considerably higher income are not eligible for the Child Tax Credit. However, they may be able to claim a partial credit.
How to claim a Child Tax Credit
To claim this benefit, enter your children or dependents on the US Individual Income Tax Form 1040. Submit this form alongside a Credits for Qualifying Children and Other Dependents Schedule 8812. A Schedule 8812 helps you figure out the amount of tax credits your child is eligible for,
How to handle a denied Tax Credit claim
While claiming your Child Tax Credit should be a seemingly smooth process, there are situations where your claim is either audited or denied by the Internal Revenue Service (IRS).
If your claim is audited, it may be because your child is not qualified for a Child Tax Credit, or they have already been claimed by another taxpayer. To rectify this, submit copies of your proof or residency, proof of relationship and any other document specified in the letter or notice sent by the IRS.
If your claim is denied or was denied in the past, file an Information to Claim Certain Credits After Disallowance Form 8862 with your next tax return.
To check if your child or dependent meets the criteria for a Child Tax Credit, use this online tool developed by the IRS.
