Child Tax Credit: Everything You Need to Know about Publication 972

Child Tax Credit: What You Should Know

Child Tax Credit: What You Should Know

The Child Tax Credit is a tax benefit provided by the Internal Revenue Service (IRS) to help families with the cost of raising children. It is a valuable credit that can significantly reduce the amount of taxes owed or even result in a refund.

Here are some important things you should know about the Child Tax Credit:

  1. Eligibility: To qualify for the Child Tax Credit, you must have a qualifying child who meets certain criteria. This includes being under the age of 17, being a U.S. citizen, national, or resident alien, and being claimed as a dependent on your tax return.
  2. Amount: The maximum amount of the Child Tax Credit is $2,000 per qualifying child. However, the credit is subject to income limitations. The credit begins to phase out for single filers with a modified adjusted gross income (MAGI) of $200,000 and for married couples filing jointly with a MAGI of $400,000.
  3. Additional Child Tax Credit: If the amount of your Child Tax Credit exceeds the amount of taxes you owe, you may be eligible for the Additional Child Tax Credit. This credit is refundable, meaning you could receive a refund even if you don’t owe any taxes.
  4. Claiming the Credit: To claim the Child Tax Credit, you must include Form 8812 with your tax return. This form will calculate the amount of your credit based on your qualifying child’s information and your income. Make sure to follow the instructions carefully to ensure you receive the full benefit.

Publication 972: A Comprehensive Guide

Publication 972: A Comprehensive Guide

Publication 972 is a comprehensive guide provided by the Internal Revenue Service (IRS) that provides detailed information about the Child Tax Credit. This publication is designed to help taxpayers understand the eligibility requirements, calculation methods, and other important aspects of the Child Tax Credit.

The Child Tax Credit is a tax benefit that allows eligible taxpayers to reduce their federal income tax liability by a certain amount for each qualifying child. The credit can be worth up to $2,000 per child, and it is refundable up to $1,400 per child.

Publication 972 covers various topics related to the Child Tax Credit, including:

Topic Description
Qualifying Child Explains the criteria that a child must meet to be considered a qualifying child for the Child Tax Credit, such as age, relationship, residency, and support.
Phaseout Limits Provides information on the income limits that may reduce or eliminate the Child Tax Credit for higher-income taxpayers.
Calculating the Credit Details the step-by-step process for calculating the amount of Child Tax Credit that a taxpayer is eligible for, including examples and worksheets.
Additional Child Tax Credit Explains the Additional Child Tax Credit, which is a refundable credit that may be available to taxpayers who cannot fully utilize the Child Tax Credit.
Claiming the Credit Provides guidance on how to claim the Child Tax Credit on the taxpayer’s federal income tax return, including the necessary forms and documentation.

Publication 972 also includes examples, worksheets, and frequently asked questions to help taxpayers better understand and navigate the Child Tax Credit. It is an essential resource for taxpayers who have children and want to take advantage of this valuable tax benefit.

Categories IRS