Our program automatically calculates the Child Tax Credit and the Additional Child Tax Credit based on the dependents and income entered into your account.
Who can be considered a Qualifying Child?
A qualifying child for this credit is someone who:
- Is claimed as your dependent,
- Child must have a SSN (ITIN not allowed for Child Tax Credit or Additional Child Tax Credit)
- Was under age 17 at the end of the tax year (Age 17 or under for tax year 2021)
- Child did not provide more than half of his or her own support for the year
- Child lived with you for more than half of the year
- Child did not file a joint tax return for the year (or files only to claim a refund of taxes withheld or estimated tax paid)
- Is your son, daughter, adopted child, grandchild, stepchild or eligible foster child, your sibling, step-sibling or their descendant, and
- Is a U.S. citizen or resident alien.
Provided below is a comparison for the tax year 2020 and prior as compared to tax year 2021.
Child Tax Credit
|Tax Year 2020 and before||Tax Year 2021|
|How much is the credit?||
|How do I claim the credit?||Automatically calculated and included on tax return.||
*Example Limitations 2020 and prior: If the amount of the credit you can claim is $2,000, but the amount of your income tax liability is $400, the credit ordinarily will be limited to $1,600 ($2,000 - $400). However, because the credit is only partially refundable, the maximum credit you could claim would be $1,400.
If the amount of credit you can claim is $2,000, but the amount of your tax liability is $0, the maximum credit amount you could claim is limited to $1,400. This is generally indicated as the Additional Child Tax Credit (ACTC) on the return.
For more information covered in IRS Publication 972, click here.