Qualifying Standards

• In order for children to qualify as eligible for the Child Tax Credit, they must meet six qualifying criteria: an age test, a relationship test, a support test, a dependent test, a citizenship test and a residence test. In general, qualifying children must be 16 or younger as of the end of the tax year, must be related to the taxpayer claiming the credit, must not have provided more than half their own support and must be claimed by a dependent on the taxpayer's tax return. In addition, a qualifying child must be a U.S. citizen and must have resided with the taxpayer for more than half of the tax year.
  
  

Phase Out

• The Child Tax Credit is phased out and eliminated for higher income taxpayers. Married taxpayers filing jointly can claim the full credit with a modified adjusted gross income of $110,000 or less. For married taxpayers filing separately and for all other taxpayers, these amounts are $55,000 and $75,000, respectively. Above these amounts, the maximum credit is reduced and eventually eliminated over the next $20,000 of modified adjusted gross income. As a result, married taxpayers filing jointly with modified adjusted gross incomes of $130,000 or more can not claim any credit.
  
  

Reporting

• The Child Tax Credit is reported by individual income taxpayers to the IRS on page 2 of Form 1040, U.S. Individual Income Tax Return. Taxpayers compute the value of the credit using a worksheet available published in the instructions to Form 1040. Taxpayers with more than three qualifying children must additionally complete and attach Form 8812, Additional Child Tax Credit.
  
  

Refundable Credit

• The Child Tax Credit is a partially refundable credit, meaning that the credit may generate a refund to the taxpayer even if the credit is greater than the amount of tax paid by the taxpayer. The amount of any refund is related to the taxpayer's income and varies depending on the number of qualifying children the taxpayer claims.