The Child Tax Credit for 2024 offers families up to $2,000 per qualifying child, but eligibility requirements and potential changes loom on the horizon.
At a Glance
- Child Tax Credit for 2024 provides up to $2,000 per qualifying child under 17
- Refundable portion offers up to $1,700 per qualifying child
- Credit value decreases for high-income earners
- Current credit amount set to decrease to $1,000 per child in 2026
- Tax filing for 2025 begins January 29, with a deadline of April 15
Understanding the 2024 Child Tax Credit
As families prepare for the 2025 tax season, which covers the 2024 tax year, the Child Tax Credit remains a crucial financial support for millions of American households. This credit, offering up to $2,000 per qualifying child under 17, has been a cornerstone in efforts to combat child poverty since its enactment in 1997.
The Child Tax Credit assists approximately 40 million families annually in managing essential expenses. However, eligibility requirements are specific and must be met to claim the credit. The child must have a valid Social Security number for employment in the United States, be related to the filer, and not provide more than half of their own financial support during the tax year.
#TaxTwitter: For tax year 2025, the maximum credit allowed for an adoption of a child with special needs is the amount of qualified adoption expenses up to $17,280, increased from $16,810 for tax year 2024. Learn more at: https://t.co/YG3opfsbeN #adoptionmonth pic.twitter.com/7UeK6DKDFP
— IRS Tax Pros (@IRStaxpros) November 30, 2024
Eligibility Criteria and Benefits
To qualify for the Child Tax Credit, the child must live with the filer for more than half of the tax year and be claimed as a dependent on the tax return. The child must also be a U.S. citizen, U.S. national, or U.S. resident. It’s important to note that the credit value decreases if the parent’s or guardian’s gross income exceeds $200,000 for individuals or $400,000 for joint filers.
The refundable portion of the Child Tax Credit can provide up to $1,700 per qualifying child. This aspect of the credit is particularly beneficial for low-income families who may not owe taxes but can still receive the refundable portion as part of their tax refund.
Filing Tips and Future Outlook
To claim the Child Tax Credit, taxpayers must list children and dependents on a 1040 form and complete Schedule 8812. The tax filing season for 2025 begins on January 29, with IRS Free File available from January 12. The filing deadline is April 15, unless an extension is granted. However, it’s crucial to remember that extensions to file do not extend the payment deadline, and late payments incur fees and penalties.
Eligible workers with qualifying children could get up to $7,430 when claiming the Earned Income Tax Credit, up from $6,935 in 2022. Eligible workers between the ages of 25 and 64 with no dependents can get up to $600 by claiming the EITC. https://t.co/DtWmvtLD2I #IRS pic.twitter.com/rMR0Fb7OJS
— IRSnews (@IRSnews) February 13, 2024
Looking ahead, families should be aware that the current credit amount is set to decrease to $1,000 per child in 2026. This potential reduction has raised concerns among finance experts about the impact on low-income families who rely on this credit to make ends meet. As tax season approaches, it’s advisable for families to stay informed about any legislative changes that may affect the Child Tax Credit and to plan accordingly for their financial future.
