What is the Child Tax Credit?
If your child is a parent, you may have heard of the Child Tax Credit. It’s a huge tax break for families and can reduce your tax bill (or increase your refund!) We’ll explain what the Child Tax Credit is, who qualifies, and how to claim it on your federal income tax return. We’ll go over what the Child Tax Credit is, who qualifies, and how to claim the CTC on your federal income tax return.
At a glance:
The Child Tax Credit is worth up to $2,000 per qualifying child under age 17 for 2024 and 2025.
- Income limits apply — the full credit is available for those earning under $200,000 (or $400,000 if married filing jointly).
- Up to $1,700 of the credit may be refundable if you meet certain income requirements.
- You’ll need to file a tax return to claim the credit.
- What is the CTC?
The Child Tax Credit is a federal tax benefit designed to help taxpayers with the costs of raising children. The Child Tax Credit reduces your tax liability on a dollar for dollar basis. To claim the federal Child Tax Credit you and your dependent child must meet certain eligibility requirements. This is what it looks like.
Your dependent child must meet the following criteria to be considered a qualified child:
Be younger than 17 at the end the tax year.0100 The full Child Tax Credit will be available to filers who meet certain income thresholds. Once your modified adjusted gross income (MAGI) goes above a certain amount, the credit begins to phase out.
- Here are CTC income limits for both 2024 and 2025:
- Filing status
Phaseout begins at
Married filing jointly
$400,000
- Single or head of household
- $200,000
- Married filing separately
- $200,000
- Your credit gets reduced by $50 for every $1,000 (or part of $1,000) above these limits.
- CTC qualifications at a glance
How much is the Child Tax Credit for 2025?
- The maximum Child Tax Credit amount for 2024 and 2025 is $2,000 per qualifying child.
- Note:
The Tax Cuts and Jobs Act (TCJA) set this amount from 2018 through 2025. If Congress does nothing to extend the TCJA beyond 2025, the CTC amount will revert to the pre-2018 $1,000 per child. As changes happen, we will update this page accordingly!
Is the Child Tax Credit refundable?
The CTC is only partially refundable, meaning:
| You can use the credit to lower your tax bill to $0. | If you still have unused credit left, you might get a refund through the Additional Child Tax Credit (ACTC) — but only up to the refundable limit. The maximum amount of refundable credit per child for 2024 and 2025 is $1,700. |
| Still have questions? Read our full ACTC guide here. | How to get the Child Tax Credit |
| Claiming the CTC isn’t complicated, especially if you file with TaxAct! We’ll guide you through the process and help you claim your credit automatically. Our tax preparation software will calculate the CTC based on your answers. It will also determine if any amount is refundable. If everything looks good, a screen will appear showing you how much you qualify for. There are currently no advance Child Tax Credit payments scheduled for 2025. There are currently no advance Child Tax Credit payments scheduled 2025. | How many children can I claim the Child Tax Credit for? |
| There’s no official limit to how many children you can claim the CTC for, as long as each child meets the eligibility requirements. | Can I claim the CTC if I had a baby in 2024? |
Yes! If your child was born in 2024 at any point, they are considered to have lived with the taxpayer for the entire year. So, for example, you’ll be able to claim any qualifying children born in 2024 on your 2024 tax return (the taxes due April 15, 2025).
Who claims the CTC when parents are divorced?
The CTC is simple enough for married couples filing a joint return, but what if you are unmarried or divorced?
Only one parent can claim the credit per child, per year. The custodial parent is usually the parent who has the child for the majority of the year, unless a different arrangement has been made. The Internal Revenue Service will consider the parent with the highest adjusted gross income to be the custodial parents if the child lives with you both equally. If you are an adoptive parent you can claim the CTC if the following conditions are met:
The child meets the age and residency rules.You legally adopted them or are You can claim the Child Tax Credit for your adopted child if you meet the following requirements:
The adopted child must be a child who is legally adopted or in the process of adoption (and was We talk more about this, the Earned Income Tax Credit (EITC), and other credits for new parents in Bottles, Diapers, and 7 Tax Benefits: Life with a Newborn.
What’s the difference between the CTC and the Adoption Tax Credit?
- While both credits benefit parents, they serve different purposes. The Child Tax Credit offers ongoing tax relief to families who raise children, including adopted ones. Adoption Credit helps with upfront costs such as court fees and travel expenses. The Child Tax Credit (CTC) is only available to qualifying children under 17 years of age who meet IRS requirements. This includes having a valid Social Security Number (SSN). You cannot claim the CTC for any other dependents such as older children or parents or relatives living with your. The ODC is nonrefundable and can be up to $500 for each qualifying person. While it won’t increase your refund like the CTC can, it can help reduce your tax liability.
- What is the Child and Dependent Care Credit?
- This is another tax credit that often gets confused with the Child Tax Credit, but it covers a different kind of expense. The Child and Dependent Care Credit can help you offset the costs of childcare (or care for an incapacitated spouse or dependent), so you can go to work or find work. It is based on actual care costs and is separate from Child Tax Credit which is aimed at reducing your taxes just for having children who qualify.
The bottom-line
