What is the child tax credit for 2024?

Projected Changes to the Child Tax Credit for the 2024 Tax Year

Child Tax Credit for 2024

The Child Tax Credit (CTC) has undergone several changes in recent years, and for the 2024 tax year, taxpayers can expect the following:

1. Credit Amount

  - The initial amount of the CTC for 2024 is $2,000 for each qualifying child.

2. Phase-out Thresholds

  - The credit amount begins to phase out for taxpayers with adjusted gross income (AGI) exceeding $200,000, or $400,000 for those filing a joint return.

3. Refundability

  - The portion of the CTC that can be claimed as a refundable credit, known as the Additional Child Tax Credit (ACTC), has increased to a maximum of $1,600 for each qualifying child.

4. Qualifying Child Criteria

  - To be a qualifying child for the 2023 tax year, the dependent generally must:

    - Be under age 17 at the end of the year.

    - Be the taxpayer's son, daughter, stepchild, eligible foster child, sibling, stepsibling, or a descendant of one of these (e.g., grandchild, niece, or nephew).

    - Not provide more than half of their own financial support during the year.

    - Live with the taxpayer for more than half of the year.

    - Be properly claimed as the taxpayer's dependent on the tax return.

    - Not file a joint return with their spouse for the tax year unless it is only to claim a refund of withheld income tax or estimated tax paid.

    - Be a U.S. citizen, U.S. national, or U.S. resident alien.

5. Legislative Monitoring

  - The IRS is closely monitoring any legislation being considered by Congress that could affect the Child Tax Credit. If there are any changes to the CTC guidelines, the IRS will automatically make adjustments for those who have already filed, so no additional action will be needed by eligible taxpayers.

6. Expiration of Enhancements

  - Many of the changes to the CTC implemented by the American Rescue Plan Act of 2021 have expired. This includes the enhanced credit for qualifying children under age 6 and children under age 18.

7. Filing for the Credit

  - Taxpayers can claim the Child Tax Credit by entering their children and other dependents on Form 1040, U.S. Individual Income Tax Return, and attaching a completed Schedule 8812, Credits for Qualifying Children and Other Dependents.

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Sources:

Tax Time Guide 2024: What to know before completing a tax return 2024-08-02

Child Tax Credit | Internal Revenue Service 2024-08-01

Publication 505 (2024), Tax Withholding and Estimated Tax 2024-08-03

Tax and Estimated Withholding Tax - Internal Revenue Service 2024-08-01

Estimated taxes | Internal Revenue Service 2024-08-03

IRS advances innovative Direct File project for 2024 tax season; free ... 2024-07-31

IRS provides tax inflation adjustments for tax year 2024 2024-08-04

Tax Withholding Estimator | Internal Revenue Service 2024-08-02

2024 Form 1040-ES - Internal Revenue Service 2024-08-03

Questions and answers on the Premium Tax Credit 2024-08-02