How to Qualify for the Child Tax Credit
Parents who have dependent children may be eligible for the child tax credit to reduce their tax burden. However, to obtain this credit, parents or guardian must meet certain criteria in order to qualify for this tax credit such as the age, residency and income.
- Verify that your child meet the age limit, which is under the age of 17. The credit amount is $1000 per child. The credit amount reduces your tax bill. If you have three children less than 17 years, your tax credit is $3000. However, this amount is less if you income exceed the amount stipulated by the Internal Revenue Service, which currently is $110,000 for married filing jointly, $55,000 for married filing separately and $75,000 head of household.
- Understand that the child tax credit is separate from the exemption deduction of $3700, the amount for 2011 tax year.
- Meet the residency requirement. Dependents for the credit must be either being a U.S. citizen or a permanent resident alien. The definition of a qualifying child was changed recently to include stepsiblings, half-siblings along with children, stepchildren, adopted children, grandchildren and great-grandchildren. Foster children also are eligible if the court or an authorized agency places them in your custody. The child you claim must live with you for at least half the year.
- Get a valid social security number, as this is part of the qualification process. Make sure that the child is your depended listed on your tax return.
- Understand that in some cases your credit is nonrefundable. This means your tax liability was zero. In other cases with a zero tax liability, you can check to see if you qualify for the Additional Child Tax Credit.