Child Tax Credit

Extracted Attributes

• Purpose

  Tax credit for parents with dependent children to reduce federal income tax liability

• Mechanism

  Reduces tax liability dollar for dollar; can be nonrefundable or refundable

• Qualifying Child Criteria

  Under age 17 (16 or younger) at the end of the tax year; must have a Social Security number valid for employment in the United States

• Forms Required (United States)

  Form 1040, Schedule 8812

• Initial Credit Amount (United States - 1997)

  $500 (nonrefundable)

• Eligibility (United Kingdom - Income Threshold)

  £42,000 per year

• Maximum Credit Amount (United States - 2024/2025 Tax Year)

  Up to $2,000 per qualifying child under age 17

• Eligibility (United States - Income Threshold for Full Credit)

  $400,000 per year (joint filers), $200,000 per year (single filers) for 2024

• Maximum Refundable Amount (United States - 2024/2025 Tax Year)

  Up to $1,700 per child (via Additional Child Tax Credit)

Timeline

• The Child Tax Credit was introduced with the Taxpayer Relief Act of 1997, initially providing a nonrefundable $500 credit. (Source: web_search_results)

  1997

• The Tax Cuts and Jobs Act of 2017 created the R&D Tax Problem, which later became linked to the Child Tax Credit. (Source: related_documents)

  2017

• Temporarily increased credit amounts were available: $3,600 for children under 6 and $3,000 for children under 18, with different income thresholds. (Source: web_search_results)

  2021

• The Child Tax Credit is worth up to $2,000 per qualifying child under age 17, with up to $1,700 as a refundable credit. (Source: web_search_results)

  2024-2025

• Refunds, including payments by direct deposit, for those claiming the Additional Child Tax Credit for the 2024 tax year will not be issued before this date. (Source: web_search_results)

  2025-03-03

• Unless extended, the federal Child Tax Credit is projected to drop to $1,000 per child. (Source: web_search_results)

  After 2025

• Legislative progress in Congress to address the R&D Tax Problem is stalled due to its link with the Child Tax Credit. (Source: related_documents)

  Ongoing

Child tax credit

A child tax credit (CTC) is a tax credit for parents with dependent children given by various countries. The credit is often linked to the number of dependent children a taxpayer has and sometimes the taxpayer's income level. For example, with the Child Tax Credit in the United States, only families making less than $400,000 per year may claim the full CTC. Similarly, in the United Kingdom, the tax credit is only available for families making less than £42,000 per year.

Web Search Results

• The Child Tax Credit: How It Works and Who Receives It

  The child tax credit allows eligible taxpayers to reduce their federal income tax liability by up to $2,000 per qualifying child. The maximum amount of the credit is equal to the number of qualifying children a taxpayer has multiplied by $2,200. If their tax liability is less than the value of their child tax credit, they may be eligible for a refundable credit calculated using the earned income formula. Under this formula, a family is eligible for a refund equal to 15% of their earnings in [...] to help ease the financial burden that families incur when they have children. Like other tax credits, the child tax credit reduces tax liability dollar for dollar of the value of the credit. Initially the child tax credit was a nonrefundable credit for most families. A nonrefundable tax credit can only reduce a taxpayer's income tax liability to zero, while a refundable tax credit can exceed a taxpayer's income tax liability, providing a cash payment primarily to low-income taxpayers who owe [...] to help ease the financial burden that families incur when they have children. Like other tax credits, the child tax credit reduces tax liability dollar-for-dollar of the value of the credit. Initially the child tax credit was a nonrefundable credit for most families. A nonrefundable tax credit can only reduce a taxpayer's income tax liability to zero. In contrast, a refundable tax credit can exceed a taxpayer's income tax liability, providing a cash payment to low- and some moderate-income

• 2025-2026 Child Tax Credit: Requirements, How to Claim

  The child tax credit is a benefit for parents and caregivers with dependent children under 17. You can get up to $2,200 per child, but the actual amount you receive depends on your modified adjusted gross income and filing status. High earners may receive a reduced credit amount or may not qualify at all. If the credit amount is worth more than the taxes you owe, you could receive a portion of the difference back as a refund through what's known as the additional child tax credit. [...] Although similar sounding, the child tax credit and the child and dependent care credit are not the same thing. The child tax credit is a tax incentive for people with children, while the child and dependent care credit is another tax credit for working parents or caretakers designed to help offset expenses such as day camp or after-school care. Both credits have different rules and qualifications. Article sources [...] The child tax credit is a popular benefit for taxpayers with dependents. Learn more about who qualifies, how it works and what changes were ushered in by the One Big Beautiful Bill Act.

• Child Tax Credit Payment Schedule for 2025 - Taxfyle

  The Child Tax Credit (CTC) for the 2024 tax year and 2025 tax year is worth up to $2,000 per qualifying child under age 17. However, the amount you receive depends on your income, tax liability, and eligibility for the Additional Child Tax Credit (ACTC). Here’s how the credit amount is determined: [...] The Child Tax Credit 2024–2025 is worth up to $2,000 per child, with up to $1,700 as a refundable credit. Refunds, including payments by direct deposit, won’t be issued before March 3, 2025, for those claiming the Additional Child Tax Credit. Parents must file a federal tax return to claim the child tax credit, using Form 1040 and Schedule 8812. Working with a tax pro can help you maximize tax deductions and reduce your tax liability. [...] Unless extended, the federal child tax credit will drop to $1,000 per child after 2025.

• 2024-2025 Child Tax Credit: Top 7 Requirements - TurboTax - Intuit

  The Child Tax Credit has seen many forms from its introduction with the Taxpayer Relief Act of 1997 (TRA). The original version of the CTC provided for a nonrefundable $500 for households with up to $110,000 in income. An alternative formula was provided for families with three or more qualifying children that made a portion of the CTC refundable. [...] ### Child Tax Credit for 2023, 2022, 2020, and earlier tax years (see below for 2021) To claim the Child Tax Credit for 2023, 2022, 2020, and earlier tax years, you need to determine if your child is eligible. All of these seven qualifying tests have to be met: 1) Age test - For these tax years, a child has to be under age 17 (i.e., 16 years old or younger) at the end of the tax year for which you claim the credit. [...] Qualifying families with incomes less than $75,000 for Single, $112,500 for Head of Household, or $150,000 for Married Filing Jointly returns were eligible for the temporarily increased credit of $3,600 for children under 6 and $3,000 for children under 18. Above these income amounts, the credit was reduced by $50 for each $1,000 over these limits.

• Child Tax Credit | Internal Revenue Service

  The Child Tax Credit helps families with qualifying children get a tax break. You may be able to claim the credit even if you don't normally file a tax return. ## Who qualifies You can claim the Child Tax Credit for each qualifying child who has a Social Security number that is valid for employment in the United States. To be a qualifying child for the 2024 tax year, your dependent generally must: [...] You can claim the Child Tax Credit by entering your children and other dependents on Form 1040, U.S. Individual Income Tax Return, and attaching a completed Schedule 8812, Credits for Qualifying Children and Other Dependents, Credits for Qualifying Children and Other Dependents"). ## Information if we audit or deny your claim: I received a letter from IRS about my credit: What should I do? What to do if we deny your claim ## Other tax credits for families [...] You qualify for the full amount of the 2024 Child Tax Credit for each qualifying child if you meet all eligibility factors and your annual income is not more than $200,000 ($400,000 if filing a joint return). Parents and guardians with higher incomes may be eligible to claim a partial credit. ## How to claim this credit