Child Tax Credit in 2024: How much is the Child Tax Credit and how to get it? All We Know
Contents
Child Tax Credit 2024
The Child Tax Credit provides a benefit worth $2000 for individuals who have a child under 17 years old as a dependent. The CTC may be refunded up to $1600 for the fiscal year 2024. The CTC is federal tax which benefits taxpayers who have dependent children.
CTC was in the spotlight this year as legislators tried to expand it, but failed to do so prior to the 2024 tax filing season. The tax rates remained the same because the filers rushed to file their tax returns before the deadline of 15 April 2024. Children under 17 years old could claim up to $1600 in refunds and a maximum of $2000 per child.
What is the USA CTC Amount
The Child Tax Credit was $2000 for each qualifying child in the prior year. For married couples filing jointly with a modified adjusted gross, this amount is capped at $400,000. For single parents, however, it’s set at $200,000. Media reports indicate that the CTC is expected to be increased from $2000 per qualifying child to $3600 and to $3000 for children above the age of 6.
Your child tax credit is reduced by $50 per $1000 of income that exceeds the above limit. The return for the 2024 taxation will be filed the following year. For each child entitled to the CTC, it will be worth $2000, and there will be a potential refund of $1700 through an Additional Child Credit.
Who can apply for the CTC?
You can qualify for the Child Tax Credit in the USA if you pay annual taxes and meet the following eligibility criteria.
- The dependent child must be under the age of 17 at the end the tax year.
- The child must be a child of the applicant, such as a son, daughter, stepchild, foster child or grandchild.
- Some exceptions apply. The child dependent must have lived with the applicant at least half of the year.
- The child must have been financially supported by the recipient during the calendar year.
- The dependent child must also be a U.S. citizen or resident alien, with a valid social security number.
- As income exceeds the threshold, the credit is gradually reduced until it is phased-out.
Inland Revenue Service determines CTC by multiplying earned income above $2500 by 15 percent. CTC can be claimed in full or in part, but not both.
How do I get a child tax credit?
If you’ve requested a tax extension, you may claim the CTC as well as the additional child tax credit by filing Form 1040 by October 20, 2024. The Form 1040 allows you to calculate your taxable income by using several credits. These include education credits, child taxes credits, and more. Schedule 8812 is used to calculate the Child Tax Credit, Additional Child Tax Credit.
The official tax software can be used to get guidance on application questions that are asked during the application process and to automatically fill out the form. We recommend that you read Schedule 8812 if you have more than three children. Please note that you can get the IRS Free Filing Program if your income is below the threshold.
All We Know
The Child Tax Credit, as it stands today, is a nonrefundable credit available to taxpayers who have dependent children. The Child Tax Credit reduces their tax bill dollar for dollar. Please be informed that some taxpayers may be eligible to receive a partial CTC refund using the Additional Child Tax Credit.
The age of the child and the relationship between the child and the applicant are usually the criteria for eligibility. Income rule implies that those with low incomes can also get financial relief. The CTC will decrease automatically or be removed if the modified adjusted gross is above the maximum for the filling status.