How Much is the Child Tax Credit?

You may qualify for the Child Tax Credit, which is a tax credit for your dependent children that is better than a tax deduction since it lowers your taxes dollar-for-dollar.

Table of Contents

How Much is the Child Tax Credit for 2023 and 2024

How much is the child tax credit?

The Child Tax Credit can provide up to $2,000 in tax relief for qualified families with each child.

Families with 17-year-old children will be eligible to claim the Child Tax Credit.

If your income is less than $150,000 for married couples filing jointly, $75,000 for singles, or $112,500 if you are the head of household, you will be eligible for the entire credit.

What is Child Tax Credit?

For each qualified child under the age of 17, the Child Tax Credit program may lower your federal tax liability by thousands of dollars.

  • Beginning in the summer of 2021, significant improvements to the Child Tax Benefit will allow many families to receive early monthly payments of the credit.
  • Beginning July 15, 2021, the Internal Revenue Service (IRS) will pay half of the entire credit amount in advance monthly payments.

When you submit your 2021 income tax return, you'll be able to claim the other half. Only the tax year 2021 is affected by these changes.

Who is Eligible for Child Tax Credit?

To claim the Child Tax Credit, the child must be under the age of 17 to be eligible for this federal program.

A qualified child must be a son, daughter, foster child, brother, sister, stepbrother, stepsister, or descendant of any of these individuals (for example, your grandchild, niece, or nephew).

Adopted children who have been legally placed with you for adoption are also eligible.

Eligible families may get a $300 monthly advance payment of their 2021 Child Tax Credit for each child under the age of six, and a $250 monthly advance payment for each child aged six and older.

These payments may be made in advance and reflect a portion of the tax year 2021 Child Tax Credit, rather than receiving this credit as part of your return in 2022.

I Just Had a Baby. Am I Eligible for the CTC?

In a nutshell, sure. The child tax credit is available to parents of infants in 2021. The hitch is that you must notify the IRS.

Because the government department does not have information for your baby on file, you will need to use the CTC portal to update your number of qualified children.

Don't worry if you decide not to participate in the upfront payments. You may still claim the credit when you submit your tax return.

I'm Divorced and Share Custody of My Child. Am I Eligible for the CTC?

Only one individual may claim the Child Tax Credit (CTC) and get advance payments in 2021. The person who stays with the child for more than half the year is eligible to claim the credit.

Even if you are divorced and have joint custody of your child, the CTC cannot be divided or shared.

What is the Other Dependent Tax Credit?

If you don't qualify for the Child Tax Credit and your dependent child is beyond the age of 17, or you assist a friend or family, you may be eligible to claim the Other Dependent Tax Credit of up to $500 per qualified individual.

If your adjusted gross income exceeds $200,000 (or $400,000 for married filing joint returns), the credit will begin to taper down.

How to claim the child tax credit

The Child Tax Credit is a valuable tax benefit for families with children. It can provide up to $2,000 for each qualifying child under the age of 17.

Parents who meet the eligibility requirements may be able to claim the child tax credit on their federal tax return.

To get started, taxpayers should gather information about themselves and any eligible children they have.

This includes ensuring they have valid Social Security numbers or other acceptable identification documents for each relative they plan to include in the claim.