Here's what you need to know about the Child Tax Credit (CTC), the Additional Child Tax Credit (ACTC) the refundable portion and the Credit for Other Dependents (ODC).
- Beginning with tax year 2018 and through tax year 2025, you may be able to claim ODC, a new nonrefundable credit for each eligible dependent who can't be claimed for the child tax credit.
- Know that for CTC/ACTC:
- The maximum amount of CTC per qualifying child is $2,000.
- The refundable part of the credit, ACTC, is worth up to $1,400 for each qualifying child.
- A qualifying child must have a Social Security Number issued by the Social Security Administration before the due date of your tax return (including extensions).
- CTC/ACTC begins to decrease in value if your gross incomes exceed $200,000 ($400,000 for Married Filing Jointly).
- ACTC is not allowed if you or your spouse (if filing a joint return) file a Form 2555 or Form 2555EZ (excluding foreign earned income).
- Know who is a qualifying child for CTC/ACTC. The child must:
- Be under 17 at the end of the tax year.
- Meet the relationship and residency tests for uniform definition of a qualifying child, see the Child-Related Tax Benefits Comparison Chart.
- Not provide more than half of his or her own support for the tax year
- Have lived with you for more than half the tax year (see Publication 972, Child Tax Credit, for exceptions for birth or death during the year, temporary absences, kidnapped or missing or children of divorced or separated parents)
- Be claimed as a dependent on your return
- Not file a joint return for the year (or filed the joint return only to claim a refund of taxes withheld or estimated taxes)
- Be U.S. citizen, U.S. National or a U.S. resident alien. For more information see Publication 519, U.S. Tax Guide for Aliens.
- Must have a Social Security Number issued by the Social Security Administration before the due date of your tax return (including extensions).
- Know that for ODC:
- This is a non-refundable tax credit of up to $500 per qualifying person.
- The credit begins to decrease in value if your adjusted gross income exceeds $200,000 ($400,000 for married filing jointly).
- Know who is a qualifying dependent for ODC. The dependent must be:
- A dependent claimed on your return.
- A dependent who can't be claimed for the CTC/ACTC.
- A U.S. citizen, U.S. national, or U.S. resident alien. For more information see Publication 519, U.S. Tax Guide for Aliens.
- A dependent is not required to have an SSN. They can have an SSN, ITIN, or ATIN that was issued before the due date of the return (including extensions).
- Know how to Avoid Common ACTC Errors and keep good records
Find the latest news for refundable credits on What's Hot?
Protect your clients by knowing the questions to ask to help your client's get the most out of refundable credits.
Compare child related benefits at a glance on our Child-Related Tax Benefits Comparison chart
Forms and Publications
Publication 972, Child Tax Credit
Schedule 8812, Child Tax Credit
Publication 4298, EITC, efile and Child Tax Credit Poster
What other resources do we have for you? Check out the EITC Central and Other Refundable Credits welcome page