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Am I Eligible for the Child Tax Credit?

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    If you have a child, you may be eligible for the Child Tax Credit (CTC). The CTC is designed to offset some of the money you spend on that child. You may also be eligible for an Additional Child Tax Credit (ACTC) if you earn more than $3,000 a year.

    Who Is a Qualifying Child?

    The CTC is available to tax filers who have a qualifying child. A qualifying child is a child who meets all of these factors:

    • Is your biological or adopted child, stepchild, foster child, sibling, step-sibling, half-sibling, or a descendant of any of them (like your grandchild, niece, or nephew)

    • Was under age 17 at the end of the tax year (December 31)

    • Provided less than half of their own support for the year

    • Lived with you for more than half of the tax year

    • Is claimed as a dependent on your tax return

    • Did not file a joint tax return for the year

    • Is a U.S. citizen, a U.S. national, or a U.S. resident alien

    A child is considered to have lived with you for more than half of a tax year if the child was born or died during that year, and your home was this child’s home for more than half the time they were alive. For example, if your child was born in November and lived with you for the remainder of the year, you would meet this requirement.

    You and the child are allowed certain temporary absences. The absences can be for:

    • School

    • Vacation

    • Business

    • Medical care

    • Military service

    • Detention in a juvenile facility (for child—your incarceration is not an allowed absence)

    You can use a tool provided by the Internal Revenue Service (IRS) to help determine if your child is a qualifying child for CTC purposes.

    Claiming the Credit

    In order to claim the CTC, you must file your taxes using Form 1040, Form 1040A, or Form 1040NR. People who use Form 1040EZ or Form 1040NR-EZ to file their taxes are not eligible to claim the CTC. You will need to list the name and identification number (in most cases, Social Security number) for each qualifying child on the form.

    Along with using one of the required 1040 forms, you also need to complete and attach Form Schedule 8812 when either of the following is true:

    • A child claimed under the CTC has an Individual Taxpayer Identification Number (ITIN) instead of Social Security number

    • You are eligible for the Additional Child Tax Credit (ACTC) (learn more about the ACTC below)

    An ITIN is a nine-digit federal tax processing number issued by the Internal Revenue Service (IRS). ITINs are issued to people who do not have or not eligible to get a Social Security number but are required to file or be listed on U.S incomes tax returns.

    Limits on the Credit

    The maximum CTC amount is $1,000 per child. The credit amount you get depends on your earned income. Earned income usually refers to an income you get as a result of work. Some example of earned income are:

    • Wages and salaries

    • Commissions earned as employee

    • Profits from operation of business

    • Union strike benefits

    Some examples money that are not considered earned income are:

    • Interest and dividends

    • Pensions and annuities

    • Social Security and railroad retirement benefits (including disability benefits)

    • Alimony and child support

    • Welfare benefits

    • Worker’s compensation benefits

    • Unemployment insurance

    • Nontaxable foster care payments

    • Veteran’s benefits, including VA rehabilitation payments

    If your earned income was more than the following amounts, you will get less than the maximum CTC amount:

    • $110,000 if you are married filing jointly

    • $55,000 if you are married filing separately

    • $75,000 for all other taxpayers

    For every $1,000 your income is over your tax bracket limit, the CTC amount is reduced by $50.

    Using the CTC may make you eligible for more money than what you owe. If this happens, you don’t have to pay any taxes, but you don’t get any remaining money from the CTC. This is because The CTC is a nonrefundable tax credit. For example, if you owe $750 in taxes and you are eligible for $1,000 using the CTC, the credit will cover the taxes you owe, but you won’t get the $250 in a refund. However, you can get that $250 by claiming the Additional Child Tax Credit (ACTC).

    Additional Child Tax Credit (ACTC)

    The ACTC refers to the refundable portion of the Child Tax Credit. Being refundable means it may result in a tax refund from the IRS. The eligibility requirements for the ACTC are the same as the CTC, but you must have earned at least $3,000 in income for that tax year to get it.

    Using the example from above, the CTC would cover $750 to bring the taxes you owe down to $0, and you could claim the ACTC to get the remaining $250 as a refund from the IRS.

    To claim the ACTC, you must file one of the required 1040 forms (Form 1040, Form 1040A, or Form 1040NR) and Form Schedule 8812.

    Claiming the CTC When You Share Custody of Your Child

    If you and someone else could claim your child on their taxes, the IRS will apply some tie breaker rules to decide who has the right to claim your child. The first rule looks at whether a parent and a non-parent are claiming the child. In this case, the parent will be able to claim the child.

    If it is a case between two parents, the parent who had the child physically in their home for more nights during the year gets to claim the child. If the numbers of nights are the same, then the parent with the highest Adjusted Gross Income will be able to claim the child.

    If the parents agree that the parent not entitled to claim a child under these rules will get to do so, the entitled parent needs to sign Form 8332 Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent. This can be done for one or multiple years. Every year the other parent claims the child, they must attach Form 8332 to their tax return. Form 8332 allows the other parent to claim the child for purposes of the personal exemption, the CTC, and ACTC. It does not allow the other parent to use that same child to do any of the following:

    • Qualify for Head of Household filing status

    • Get the Child and Dependent Care Tax Credit

    • Get any additional Earned Income Tax Credit (for that child)

    What Happens When the Wrong Person Claims the Child?

    If you and someone else claim your child when you file your tax return, the IRS will accept the first return it gets and reject the second one. If your return is the second return the IRS gets, you will need to file a paper version of your tax return along with a cover letter explaining the situation. You need to include evidence that shows you should be the person claiming your child, like medical and school records showing that the child lived with you.

    After reviewing the documents you provide, the IRS will make a decision about who should be claiming your child. This process can be complex. You may want to speak with a lawyer before sending your documents. Use the Guide to Legal Help to find lawyers in your area. If you are low-income, a local tax clinic may be able to help you for free. The Guide will screen you to see if you qualify for free help from a local tax clinic.

    If you want to learn more about changing a custody order, read Changing a Custody Order. You may want to speak with a lawyer who can answer questions and give you advice about custody and taxes. Use the Guide to Legal Help to find lawyers and legal services in your area.

    Getting Your Taxes Done

    If you need help getting your taxes done but can’t afford to pay someone, there are organizations that can help you. To learn more about these organizations, read Getting Your Taxes Done (for Free).