Child Tax Credit Income Limits: What You Need To Know
When figuring out your eligibility for the child tax credit, it’s important to know that there are income limits for each child under 21. The standard deduction also applies and can affect your eligibility, too.
How Your Income Affects Your Child Tax Credit
If you are married filing jointly, your income must be less than $110,000 if you have one qualifying child and less than $130,000 if you have two or more qualifying children. Your Adjusted Gross Income (AGI) is used to figure the credit. If your AGI is less than zero, then you are not eligible for the credit. The following table shows the income limits for each number of qualifying children:
Number of Qualifying Children
1 qualifying child $110,000
2 qualifying children $130,000
3 qualifying children $160,000
The Child Tax Credit is refundable so even if your tax liability is zero, the IRS will send you a check for the full amount of the credit. You can use this check to reduce your federal income tax liability or to pay down debt. child tax credit income limit
What is the Child Tax Credit?
The Child Tax Credit (CTC) is a tax credit available to parents of children under the age of 17. The CTC is worth up to $2,000 per child, which can be refunded back to the parent as a check. The CTC is considered an “in-kind” welfare payment and can be used to reduce the amount of income taxes you owe.
To qualify for the CTC, your child must meet the following requirements:
Your child must be a U.S. citizen or resident alien.
Your child must have been born or adopted after December 31, 1996.
Your child cannot have earned more than $4,000 in income in 2017. This income limit does not include income from Social Security benefits or other taxable sources like pensions, wages, and self-employment income. Income from student loans and scholarships also counts toward this limit.
If your child was disabled at any time during 2017, they may still qualify for the CTC if they meet all other eligibility requirements and their disability limits their ability to work or attend school full-time. If your child did not live with you throughout 2017 due to military service or an injury that kept them away from home for more than 60 days, they may still qualify for the CTC if you file a joint return with them and their qualifying parent(s). filemytaxesonline.org
What You Need To Know About The Child Tax Credit
The Child Tax Credit (CTC) is a tax credit available to parents who have children under the age of 17. The CTC offers a refundable tax credit, which means that you can receive a tax refund even if you don’t pay any income taxes.
There are several eligibility requirements for the CTC, including that you must have earned income and meet certain other financial qualifications. Additionally, you and your child must live in the United States to qualify for the CTC.
The CTC provides a maximum credit of $1,000 per child. The CTC is phased out gradually as your qualifying income increases. For 2018, the phase-out begins at $110,000 of adjusted gross income (AGI) for single individuals and $230,000 of AGI for married couples filing jointly. The CTC is completely eliminated at AGI levels above $400,000 for single individuals and $600,000 for married couples filing jointly.
To claim the CTC on your 2017 return, file Form 8863 by March 15, 2018. You can find more information about the CTC on IRS.gov or by calling 1-800-829-3676.
Other Ways to Get Tax Deductions
There are a few other ways to get tax deductions that aren’t based on income. You can deduct expenses for the care of a dependent, such as daycare or babysitting. You can also deduct amounts you pay for tuition and associated education expenses. And you can deduct medical expenses for yourself or your dependents.
As a family business owner, you might be wondering what the income limits are for claiming the Child Tax Credit. The following is a list of all of the income levels at which you can claim the credit:
For Tax Year 2019, you can claim the credit if your earned income is less than $2,000 or your spouse’s earned income is less than $4,000.
For Tax Year 2020 and later years, you can claim the credit if your earned income is less than $3,500 or your spouse’s earned income is less than $6,000.