What the Child Tax Credit Is

The Child Tax Credit is a federal tax benefit that reduces the amount of income tax you owe, dollar for dollar, based on the number of children you support. It is not a refund or a payment — it is a credit that lowers your tax bill. For the 2024 tax year, the credit is worth up to $2,000 per child under age 17.

The credit applies to children who are your biological children, stepchildren, adopted children, or foster children, as long as you claim them as dependents on your tax return. The child must be a U.S. citizen, national, or resident alien with a valid Social Security number.

The credit is "partially refundable," which means if the credit is larger than the tax you owe, you may receive part of the difference as a refund. The refundable portion is called the Additional Child Tax Credit, and it is capped at $1,700 per child for 2024 (this amount changes yearly).

Key Takeaways

  • The Child Tax Credit reduces your federal income tax by up to $2,000 per child under 17 for the 2024 tax year.
  • Your income must be below a certain threshold to claim the full credit; the credit phases out at $400,000 for married couples filing jointly and $200,000 for single filers.
  • You claim the credit on your federal tax return using Form 1040 and Schedule 8812, or through tax software that guides you through the process.
  • If you received advance payments of the credit in 2024, you must report that amount when you file your 2024 return, and the IRS will reconcile what you received against what you actually owe.

Income Limits and Phase-Out Rules

The full $2,000 credit is available only if your modified adjusted gross income (MAGI) is below a set threshold. For the 2024 tax year, the threshold is $400,000 for married couples filing jointly, $200,000 for single filers and heads of household, and $200,000 for married couples filing separately.

Once your income exceeds the threshold, the credit decreases by $50 for every $1,000 (or fraction thereof) over the limit. This means if you earn $1 over the threshold, you lose $50 of the credit. The phase-out continues until the credit reaches zero or until you reach the refundable portion cap.

MAGI for this credit typically means your adjusted gross income (AGI) from your tax return, but certain types of income — such as foreign earned income — may be added back. If you are unsure whether your income affects the credit, the IRS worksheet in the tax instructions walks you through the calculation.

How to Claim the Credit on Your Tax Return

You claim the Child Tax Credit when you file your federal income tax return. If you file by paper, you report the credit on Form 1040 (the main tax form) and use Schedule 8812 to calculate the Additional Child Tax Credit if you think you may be owed a refund.

If you use tax software — such as the IRS Free File options, TurboTax, H&R Block, or TaxAct — the software will ask you questions about your children and automatically calculate the credit and any refundable portion. You will need each child's full name, date of birth, and Social Security number.

You must file a return to claim the credit, even if your income is below the filing threshold. If you do not file, you do not receive the credit or any refund owed to you. The deadline to claim the credit for a given tax year is typically three years from the original due date of the return.

Advance Payments and Reconciliation

In some years, the IRS has issued advance payments of the Child Tax Credit to may be able to access families before they file their tax return. These payments were sent monthly or as a lump sum, depending on the program. If you received advance payments in 2024, you must report the total amount received when you file your 2024 return.

The IRS will compare what you received in advance against the credit you are actually owed based on your final 2024 income and tax situation. If you received more than you were owed, you may owe the difference back when you file. If you received less, you will receive the remainder as a refund or credit against other taxes owed.

The IRS sends a notice (Form 6419) in January showing how much advance payment you received. Keep this notice with your tax records. If the amount on Form 6419 does not match what you received, contact the IRS before filing to correct it.

Children Who Do Not may have access to

You cannot claim the credit for a child who does not have a valid Social Security number or Individual Taxpayer Identification Number (ITIN) issued by the IRS. The number must be valid for employment in the United States.

You also cannot claim the credit if the child is not a U.S. citizen, national, or resident alien. Foster children and adopted children do may have access to as long as they meet the age, residency, and relationship requirements and you claim them as dependents.

If another person (such as an ex-spouse or grandparent) claims the child as a dependent on their return, only that person can claim the credit for that child. If two people try to claim the same child, the IRS will disallow the credit for one or both of you and may assess penalties.

What Happens If Your Circumstances Change

If your income, filing status, or number of dependents changes during the year, it may affect the credit you can claim. For example, if a child turns 17 during the year, you can still claim the credit for that child for that tax year (the age is determined on December 31 of the tax year).

If you had a child in 2024, you can claim the credit for that child on your 2024 return even if the child was born on December 31. If you adopted a child or took in a foster child during the year, you may be able to claim the credit as long as the child lived with you for the required time and you meet all other rules.

If your income increased significantly during the year and you received advance payments, you may owe some or all of the advance payments back when you file. The reconciliation process on your return will calculate this. If you expect a large income increase, you can notify the IRS to reduce or stop advance payments.

Frequently Asked Questions

Can I claim the credit if I do not owe any federal income tax?

Yes. The refundable portion of the credit (the Additional Child Tax Credit) means you can receive money back even if you owe zero tax. However, you must file a return to receive it. The refundable amount is limited to $1,700 per child for 2024, so you may not receive the full $2,000 credit as a refund.

What if my child's other parent claims them on their return?

Only one person can claim a child as a dependent in a given year. If both parents try to claim the same child, the IRS will typically allow the claim for the parent with the higher income, but both may face penalties. If you and the other parent share custody, you should agree in advance who will claim the child each year, or alternate years.

Do I need to report the credit if I received advance payments?

Yes. You must report the total amount of advance payments you received on your 2024 tax return using Form 6419. The IRS will reconcile this against your actual credit. If you do not report it, the IRS will correct your return and may assess penalties or delay your refund.

What if I earned income from self-employment or a side job?

Self-employment income counts toward your MAGI for purposes of the income limit. You calculate your net self-employment income (after deducting half of self-employment tax) and add it to your other income to determine whether you are over the threshold. Tax software will do this calculation for you.

Can I claim the credit for a grandchild or niece or nephew I support?

Yes, but only if you claim them as a dependent on your tax return. The child must live with you for more than half the year, you must provide more than half their financial support, and they must be related to you (or meet other specific tests). A foster child placed with you by an authorized agency also qualifies.