If you have a child under the age of 17, the non-refundable Child Tax Credit may cut your federal income tax by up to $1,000 per qualifying child that you claim on your tax return. Your filing status and income may reduce or eliminate the Child Tax Credit.
If you receive less than the full Child Tax Credit, you may qualify for the refundable Additional Child Tax Credit, which means you could get a refund even if you owe no tax. If you qualify to claim the Child Tax Credit, be sure to check if you must file Schedule 8812 with your return. If you qualify to claim the Additional Child Tax Credit, you must complete and attach Schedule 8812. To determine if you qualify to claim the Child Tax Credit, you can use the ITA Tool at the IRS.gov.
Qualifications: A child must pass seven tests in order to qualify for this credit. These seven tests include:
- Age Test: The child was under the age of 17 at the end of 2013
- Relationship Test: The child is your son, daughter, stepchild, foster child, brother, sister, stepbrother, or stepsister. The child can also be a descendant of any of the above. For example, your grandchild, niece, or nephew will also meet this test. Adopted children also qualify. An adopted child includes a child lawfully placed with you for legal adoption.
- Support Test: The child did not provide more than half of his or her own support for 2013.
- Dependent Test: You claim the child as a dependent on your 2013 federal income tax return.
- Joint Return Test: A married child cannot file a joint return with their spouse they are filing jointly with, only to claim a tax refund.
- Citizenship Test: The child must be a U.S. citizen, U.S. national, or U.S. resident alien. For more information please view Publication 519, U.S. Tax Guide for Aliens.
- Residence Test: In most cases, the child must have lived with you for more than half of 2013.
For more information on the topic of the Child Tax Credit, please feel free to contact our office and/or view IRS Publication 972.
Reference: IRS Tax Tip 2014-18