The Child Tax Credit was worth $2,000 per qualifying child. The credit was first used to reduce your tax. If you had no tax liability, up to $1,500 may be refunded to you as long as you had earned a minimum of $2,500 during the taxable year. The refundable amount was equal to 15% of your earned income over $2,500, up to $1,400 and is referred to as the Additional Child Tax Credit.
To estimate how much of the refund you would receive, you can use the following equation:
(Your salary – 2,500) x .15
The credit eventually phases out for married taxpayers filing jointly with an income of $400,000 ($200,000 for all other taxpayers).
Tax year 2021 only
The Child Tax Credit has increased to $3,000 for children age 6 to 17 or $3,600 for children under age 6. The credit is fully refundable which means it will increase your refund or reduce your tax liability by this same amount.
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