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Child tax credit: 2019 tax year
Attention all taxpayers with kids — this credit could lower your tax bill.
The Child Tax Credit has changed in recent years thanks to the GOP tax reform bill. If you have a child, here’s everything you need to know about the Child Tax Credit.
What's in this guide?
What is the Child Tax Credit?
The Child Tax Credit is a federal tax credit that applies to families and taxpayers with children. It’s worth up to $2,000 per qualifying child under 17 and reduces your taxes. Only $1,400 of the credit is refundable, meaning you may receive a refund if the credit reduces your tax bill to zero.
If you have a qualifying child that is 17 or 18 or is a full-time college student under 24, you can claim a reduced, nonrefundable credit worth up to $500.
How does the Child Tax Credit work?
Let’s look at three examples to see how these credits work.
Drew owes $5,000 in taxes and has one child that’s 10 years old. He claims 100% of the Child Tax Credit and his tax bill is reduced to $3,000.
Lisa owes $3,000 in taxes and has one qualifying child who is 10 and one who is 20 but attends college full-time. She receives the $2,000 credit for her 10-year-old and the $500 credit for her 20-year-old, which reduces her tax bill to $500.
Reid doesn’t owe any taxes, but he has one qualifying child who is 16. He receives the refundable portion of the Child Tax Credit, which is worth up to $1,400 per child. But if his child was 17, he wouldn’t receive a refund because he’d only qualify for the $500 nonrefundable credit.
How much is the Child Tax Credit worth in 2019?
For taxes due in April 2020, you can claim the $2,000 child tax credit if your modified adjusted gross income is:
| Child Tax Credit | Married filing jointly | Single, head of household, qualifying widow(er) |
|---|---|---|
| $2,000 | Up to $400,000 | Up to $200,000 |
If you have a small tax bill or don’t owe any taxes at all, you can receive up to $1,400 of the Child Tax Credit as a refund as long as you meet the minimum income requirement. The Child Tax Credit hasn’t changed for taxes due in April 2021.
Limits
The Child Tax Credit has the following limitations:
How has the Child Tax Credit changed?
Prior to 2018, the Child Tax Credit was a $1,000 nonrefundable credit. Thanks to a change in tax legislation in 2018, the credit doubled to $2,000 and the modified adjusted gross income (MAGI) limits increased. Here’s what the Child Tax Credit for 2018, 2017 and 2016 looked like:
| Child Tax Credit | MAGI limit for married filing jointly | MAGI limit for single, head of household, qualifying widow(er) | |
|---|---|---|---|
| 2018 | $2,000 | Up to $400,000 | Up to $200,000 |
| 2017 | $1,000 | Up to $110,000 | Up to $75,000 |
| 2016 | $1,000 | Up to $110,000 | Up to $75,000 |
Who qualifies for the Child Tax Credit?
You may qualify for the $2,000 Child Tax Credit if you’re caring for any family-related dependents younger than 17. Or you’ll qualify for the $500 credit for any family-related dependents ages 17 and 18 or 19- to 24-year-old full-time college students. This includes grandchildren, nieces, nephews, adopted children and foster children.
A child must meet the following eligibility requirements for the credit:
- A US citizen, national or resident alien with a valid Social Security number
- Spend at least 50% of the tax year living with the person filing the credit
- Qualifies as a dependent on the person’s tax return
Taxpayers can qualify for the Child Tax Credit as long as they:
- Provide at least 50% of the child’s financial support
- Have a MAGI under $400,000 for married filing jointly or $200,000 for all other filing statuses
How to calculate the Child Tax Credit
Click on the income situation that applies to you to see step-by-step instructions on how to calculate your credit.
If you need help calculating your credit, use the IRS Child Tax Credit and Credit for Other Dependents worksheet.
However, if you file your tax return with a tax professional or preparation software, they can calculate the Child Tax Credit amount for you. You meet the eligibility requirements for up to $2,000 per qualifying child under 17 and $500 per qualifying child over 17 as long as you meet the income requirements.
Only one taxpayer can claim a qualifying child. If you’re divorced and you and your ex-spouse provide equal support to your child, you need to mutually agree on who gets to claim the credit each year.
What to watch out for
If you qualify for the Child Tax Credit, the current rates apply through 2025. The credit will likely change after this time.
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Updated April 2nd, 2020
Related tax credits or deductions
There are two other child-related tax credits you can use to reduce your tax bill. There’s the Child and Dependent Care Tax Credit and the Earned Income Tax Credit.
The Child and Dependent Care Tax Credit
If you work and are paying for professional care for a child younger than 13 or an incapacitated spouse or a parent, you may qualify for the Child and Dependent Care Tax Credit.
The Earned Income Tax Credit
This refundable tax credit was designed to help low-income families. If you qualify, you could earn up to $6,557 depending on your income, filing status and number of children.
Bottom line
If you have qualifying dependents, the Child Tax Credit could reduce your tax bill. Claim up to $2,000 for each qualifying child and $500 for other qualifying dependents. Just keep in mind that only one taxpayer can claim the Child Tax Credit and there are qualification limitations.
Most tax preparation software packages calculate your Child Tax Credit for you. Before you file your taxes, consider hiring a professional or shopping around for an online service to help you file your tax return.
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