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IRS; Five Things to Know About the Child Tax Credit

Posted by: Zaher Fallahi
Posted On: Feb 09, 2017

The Child Tax Credit is a tax credit that may save taxpayers up to $1,000 for each eligible qualifying child. Taxpayers should make sure they qualify before they claim it. Here are five facts from the IRS on the Child Tax Credit:


  1. Qualifications.

For the Child Tax Credit, a qualifying child must pass several tests:

i) Age

The child must have been under age 17 on Dec. 31, 2016.

ii) Relationship

The child must be the taxpayer’s son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half-brother or half-sister, or a descendant of any of these individuals. A qualifying child could also include grandchildren, nieces or nephews. Taxpayers would always treat an adopted child as their own child. An adopted child includes a child lawfully placed with them for legal adoption.

iii) Support

The child must have not provided more than half of his or her own annual support.

iv) Dependent

The child must be a dependent on a taxpayer’s federal tax return.

v) Joint return

The child cannot be a joint return filer, unless the only reason they are filing is to claim a refund.

vi) Citizenship

The child must be a U.S. citizen, a U.S. national or a U.S. resident alien (Green Card Holder).

vii) Residence

In most cases, the child must have lived with the taxpayer for more than six momths.

The IRS Interactive Tax Assistant tool – Is My Child a Qualifying Child for the Child Tax Credit? – helps taxpayers determine if a child is a qualifying child for the Child Tax Credit.


  1. Limitations

The Child Tax Credit is subject to income limitations and may be reduced or eliminated depending on the taxpayer’s filing status and income level.

  1. Additional Child Tax Credit

If a taxpayer qualifies and gets less than the full Child Tax Credit, could receive a refund, even if he or she did not owe any taxes, with the Additional Child Tax Credit.

Because of a new tax-law change, the IRS cannot issue refunds before Feb. 15th, 2017, for tax returns that claim the Earned Income Tax Credit (EITC) or the ACTC. This applies to the entire refund, even the portion not associated with these credits. The IRS will begin to release EITC/ACTC refunds starting Feb. 15th.

However, the IRS expects these refunds to be available in bank accounts or debit cards at the earliest, during the week of Feb. 27, 2017. This will happen as long as there are no processing issues with the tax return and the taxpayer chose direct deposit. Read more about refund timing for early EITC/ACTC filers.


  1. Schedule 8812

A taxpayer who qualifies to claim the Child Tax Credit, may need to check to see if she or he must complete and attach Schedule 8812, Child Tax Credit, with their tax return.


  1. IRS E-file

The easiest way to claim the Child Tax Credit is with IRS E-file. This system is safe, accurate and easy to use. Taxpayers can also use IRS Free File to prepare and e-file their taxes for free.

All taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return

Zaher Fallahi, Tax attorney, CPA, defends taxpayers before the IRS (FBAR, FATCA and OVDP), FTB, EDD and BOE. Telephone: (310) 719-1040 (Los Angeles), (714) 546-4272 (Orange County), or e-mail: taxattorney@zfcpa.com