What the Child Tax Credit Is

The Child Tax Credit is a federal tax reduction you can claim for each child you support. When you file your 2023 tax return in 2024, you reduce the federal income tax you owe by up to $2,000 per child under age 17. The credit applies to children who are U.S. citizens, nationals, or resident aliens, and you must have a valid Social Security number for each child to claim it.

This is not a refund you receive before filing taxes. It is a reduction in what you owe when you file your return. Depending on your income and tax situation, you may receive money back if the credit is larger than the tax you owe — this is called the refundable portion — but that happens only after you file and the IRS processes your return.

Key Takeaways

  • The Child Tax Credit reduces your federal tax by up to $2,000 per child under age 17 when you file your 2023 return in 2024.
  • Your income determines whether you receive the full $2,000 or a reduced amount; the credit begins to phase out at $400,000 for married couples filing jointly and $200,000 for single filers.
  • You must have a valid Social Security number for each child and claim them as dependents on your tax return to receive the credit.
  • The IRS uses your 2023 income to calculate the credit when you file in 2024; if your income changed significantly during 2023, you may owe money back when you file.

Income Limits and How Much You Receive

The amount of the credit depends on your modified adjusted gross income (MAGI) for 2023. If your income is below the phase-out threshold, you receive the full $2,000 per child. The phase-out thresholds are $400,000 for married couples filing jointly and $200,000 for single filers, head of household filers, and may have access to widows or widowers.

For every $1,000 of income above the threshold, the credit reduces by $50. This means if you are a single filer earning $210,000, your income is $10,000 over the $200,000 limit, so your credit reduces by $500 per child. If you have two children, your total credit would be $3,500 instead of $4,000.

The refundable portion of the credit — the amount you can receive back as a refund if it exceeds your tax liability — is limited to $1,700 per child for 2023. This means even if the full credit is $2,000 per child, you can receive no more than $1,700 back as a refund if you have no tax liability.

Who Can Claim the Credit

You can claim the Child Tax Credit for each child who meets all of these conditions: the child is under age 17 at the end of 2023; the child is your son, daughter, stepchild, foster child, sibling, or a descendant of any of these (such as a niece or nephew); the child lived with you for more than half of 2023; you provided more than half of the child's financial support during 2023; and the child is a U.S. citizen, national, or resident alien with a valid Social Security number.

You must also claim the child as a dependent on your tax return. If another person — such as a grandparent or ex-spouse — claims the child as a dependent, you cannot claim the credit for that child. Only one person can claim the credit per child each year.

If you are married, you and your spouse must file a joint return to claim the credit. If you file separately, neither of you can claim it.

How to Claim the Credit on Your Tax Return

When you file your 2023 tax return in 2024, you report the Child Tax Credit on Form 1040 (the main federal income tax form) or through tax software. You will need the child's full name, date of birth, and Social Security number for each child you are claiming.

If you use tax software or hire a tax preparer, they will ask you questions about each child and calculate the credit automatically based on your income. If you file by hand, you use the worksheet in the Form 1040 instructions to calculate the credit yourself. The IRS website (irs.gov) has the current forms and instructions available for download.

You file your return by the tax deadline, which is typically April 15 of the year after the tax year ends. For 2023 taxes, the deadline is April 15, 2024. If you cannot file by then, you can request an extension, but the extension only delays filing — you still owe any taxes due by April 15.

What Happened to Advance Payments in 2023

In 2021 and 2022, the IRS sent advance payments of the Child Tax Credit to many families throughout the year. These payments stopped in 2023. For the 2023 tax year, you receive the full credit only when you file your tax return in 2024 — there are no monthly payments sent to you in advance.

If you received advance payments in 2022 but your 2023 income was higher than expected, you may owe some of that money back when you file your 2023 return. This is one reason to file accurately and on time: the IRS will reconcile what you received in advance against what you actually owed based on your final 2023 income.

Documents You Need to Gather

Before you file, collect the following information for each child: the child's full legal name as it appears on their Social Security card; the child's date of birth; the child's Social Security number; and documentation showing the child lived with you for more than half of 2023 (such as school records, medical records, or a lease showing the child's name or your name at your address).

You also need your own Social Security number, your filing status (single, married filing jointly, etc.), and your income information for 2023. This includes W-2 forms from employers, 1099 forms for self-employment or other income, and records of any deductions you plan to claim. Keep these documents for at least three years in case the IRS asks questions about your return.

Frequently Asked Questions

Can I claim the credit if my child was born in December 2023?

Yes. The child must be under age 17 at the end of 2023, so a child born on December 31, 2023 still counts. You will need the child's Social Security number to claim the credit. If the number was not issued before you file, you can file your return and amend it later once you have the number.

What if I do not have a Social Security number for my child yet?

You cannot claim the credit without a valid Social Security number for the child. You can file your return without claiming the child, then file an amended return (Form 1040-X) once the Social Security number is issued. The amended return must be filed within three years of the original return date to claim the credit.

Do I have to repay advance payments if my income went up in 2023?

Only if you received advance payments in 2022. Since advance payments ended in 2023, there is nothing to repay for 2023. However, if your 2023 income was higher than your 2022 income and you received advance payments in 2022, you may owe back some of those 2022 payments when you file your 2023 return.

Can a foster parent claim the credit for a foster child?

Yes, if the foster child lived with you for the entire 2023 tax year and you provided more than half of their support. You must also claim the child as a dependent on your return. The child must have a valid Social Security number and be a U.S. citizen, national, or resident alien.

What if the child's other parent claims them as a dependent?

Only one person can claim the credit per child each year. If the other parent claims the child as a dependent on their return, you cannot claim the credit for that child on yours. If you both try to claim it, the IRS will contact you and one of you will have to remove the claim.