2024 Child Tax Credit: Top 7 Requirements
The Child Tax Credit can significantly reduce your tax bill if you meet all seven requirements: 1. age, 2. relationship, 3. support, 4. dependent status, 5. citizenship, 6. length of residency and 7. family income. You and your child must pass all seven to claim this tax credit.
Key Takeaways
- There are seven qualifying tests to determine eligibility for the Child Tax Credit: age, relationship, support, dependent status, citizenship, length of residency and family income.
- If you aren't able to claim the Child Tax Credit for a dependent, they might be eligible for the Credit for Other Dependent.
- The standard child tax credit is non-refundable, but the Additional Child Tax Credit is refundable allowing for up to a $1,700 refund even if you don't owe any tax.
- To fight against fraud, the IRS can delay the processing of refunds that include the Child Tax Credit. but this shouldn't discourage you from claiming this valuable tax benefit.
Child Tax Credit for the 2024 and 2025 tax years
Before we discuss how to claim the Child Tax Credit, you need to understand what is meant when we talk about a "tax year." The "2024 tax year" refers to the income you earn and the taxes you'll file for the calendar year 2024, which are typically filed by April 2025.
To claim the Child Tax Credit for the 2024 and 2025 tax years, you are required 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 must have been under age 17 (i.e., 16 years old or younger) at the end of the tax year for which you claim the credit.
2) Relationship test - The child must be your own child, a stepchild, or a foster child placed with you by a court or authorized agency. An adopted child is always treated as your own child. ("An adopted child" includes a child lawfully placed with you for legal adoption, even if that adoption is not final by the end of the tax year.) You can also claim your brother or sister, stepbrother or stepsister. And you can claim descendants of any of these qualifying people—such as your nieces, nephews and grandchildren—if they meet all the other tests.
3) Support test - To qualify, the child cannot have provided more than half of his or her own financial support during the tax year.
4) Dependent test - You must claim the child as a dependent on your tax return. Bear in mind that in order for you to claim a child as a dependent, your child has to:
- be your child (or adoptive or foster child), sibling, niece, nephew or grandchild
- be under age 19, or under age 24 and a full-time student for at least five months of the year; or be permanently disabled, regardless of age
- have lived with you for more than half the year
- have provided no more than half of their own support for the year
5) Citizenship test - The child must be a U.S. citizen, a U.S. national or a U.S. resident alien. (For tax purposes, the term "U.S. national" refers to individuals who were born in American Samoa or in the Commonwealth of the Northern Mariana Islands.)
6) Residence test - The child must have lived with you for more than half of the tax year for which you claim the credit. There are important exceptions, however:
- A child who was born (or died) during the tax year is considered to have lived with you for the entire year.
- Temporary absences by you or the child for special circumstances, such as school, vacation, business, medical care, military services or detention in a juvenile facility, are counted as time the child lived with you.
- There are also some exceptions to the residency test for children of divorced or separated parents. For details, see the instructions for Form 1040.
7) Family income test - The Child Tax Credit is reduced if your modified adjusted gross income (MAGI) is above certain amounts, which are determined by your tax-filing status. For the 2024 and 2025 tax years, the phaseout of the credit begins with $200,000 in income ($400,000 for Married Filing Jointly).
TurboTax Tip:
If you have a dependent that doesn't meet the requirements of the Child Tax Credit, you might be able to claim them as a dependent and qualify for the Other Dependent Tax Credit.
What if the credit exceeds my tax liability?
For the 2024 and 2025 tax years, the standard Child Tax Credit is nonrefundable; if your credit exceeds your tax liability, your tax bill is reduced to zero, and any remaining unused credit is lost. However, you may be able to claim a refundable Additional Child Tax Credit for the unused balance:
- Up to $1,700 per qualifying child in 2024 and 2025 is refundable with the Additional Child Tax Credit.
- You can find out if you're eligible for this refundable credit by completing the worksheet in IRS Form 8812.
What is the Other Dependent Tax Credit?
If you have a dependent that doesn't meet the requirements of the Child Tax Credit, you might be able to claim them as a dependent and qualify for the Other Dependent Tax Credit.
The Other Dependent Tax Credit is an alternative credit that can be claimed for dependents. Some of the requirements include that the dependent:
- is a U.S. citizen, U.S. national, or U.S. resident alien
- can’t be claimed on the Child Tax Credit or Additional Child Tax Credit
- will be claimed on your tax return
- has a Social Security number or Individual Tax Identification Number (ITIN)
One thing to note for this credit is that dependents can be any age. The maximum for this credit is $500 per dependent.
When will I get my tax refund with the credit?
Typically, it takes 21 days or less for the IRS to issue a refund for taxpayers who filed electronically and chose to receive their refund via direct deposit.
However, the IRS can take a little longer to issue refunds that have certain credits such as the Child Tax Credit and the Additional Child Tax Credit in an effort to reduce tax return fraud.
To check the status of your refund, you can use our tool to track your refund.
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