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What is the Child Tax Credit for 2020?

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What is the Child Tax Credit for 2020?

The Child Tax Credit (CTC) is designed to give an income boost to the parents or guardians of children and other dependents.

Taxpayers can claim the Child Tax Credit if they have a qualifying child under the age of 17 and meet other qualifications. The maximum amount per qualifying child is $2,000. Up to $1,400 of that amount can be refundable for each qualifying child. So, like the EITC, the Child Tax Credit can give a taxpayer a refund even if they owe no tax.

The qualifying child must have a valid Social Security number issued before the due date of the tax return, including extensions. For tax year 2019, this means April 15, 2020, or if a taxpayer gets a tax-filing extension, Oct. 15, 2020.

The amount of the Child Tax Credit begins to reduceor phase out at $200,000 of modified adjusted gross income, or $400,000 for married couples filing jointly.

How does the child tax credit work?

The Child Tax Credit offers up to $2,000 per qualifying dependent child 16 or younger at the end of the calendar year. There is a $500 nonrefundable credit for qualifying dependents other than children. This is a tax credit, which means it reduces your tax bill on a dollar-for-dollar basis.

What are the qualifications for child tax credit?

To claim the Child Tax Credit, you must determine if your child is eligible. There are seven qualifying tests to consider: age, relationship, support, dependent status, citizenship, length of residency and family income. You and/or your child must pass all seven to claim this tax credit.

Can you get a child tax credit with no income?

This credit is refundable, which means you can take this credit even if you owe little or no income tax. To qualify for this credit, you must have more than $3,000in earned income. The Additional Child Tax Credit is based in part on the Child Tax Credit.

Can I get child tax credit if I don’t work?

Unfortunately, no. If you don’t have any income, you won’t benefit from most federal income tax credits. When it comes to the Child Tax Credit, you can’t claim the credit if you don’t have income.

What is the difference between child tax credit and additional child tax credit?

The additional tax credit is for certain individuals who get less than the full amount of the child tax credit. The child tax credit is nonrefundable. A refundable tax credit allows taxpayers to lower their tax liability to zero and still a receive a refund. The additional child tax credit is refundable.