• Skip to content
  • Skip to primary sidebar
  • Skip to footer

Long Island Tax Resolution Services

  • Home
  • About
  • Blog
  • Free Consultation
  • Testimonials
  • En Español
  • Representation
  • Notices
  • Wage Garnishment
  • Back Taxes Help
  • Unfiled Returns
  • Levy
  • .
  • .
  • Call us at: 631-244-1650
You are here: Home / Other / Learn Everything About the Child Tax Credit in USA

December 2, 2014 by James Grennen Leave a Comment

Learn Everything About the Child Tax Credit in USA

Something you don’t realize until you have children of your own is exactly how expensive they are. The cost of providing food, clothing, baby products, healthcare, education, and other necessities can quickly mount. Thankfully, the IRS and the United States government understand the cost of being a parent and offer the Child Tax Credit to qualifying individuals.

 What is the Child Tax Credit?

The Child Tax Credit is designed to bring relief to families with children. It is worth up to $1,000 per child under the legal age of 17. The child must be claimed as a dependent and additional criteria must be met to qualify.

Child tax credits are designed to help parents reduce their child’s federal income tax liability to zero. When this happens, the child tax credit may be refundable to the benefit of the taxpayer. As the income level grows, the amount a taxpayer qualifies for is gradually reduced.

What You Need to Know About the 2014 Child Tax Credit

 The 7 Child Tax Credit Requirements

To qualify for child tax credit, you must meet a list of pre-established requirements. Here are the official necessities, according to the IRS:

  •  The age test: Your child must be under the age of 17 at the end of the 2014 calendar year.
  • The relationship test. The child must be your legal daughter or son, or your brother or sister. Your stepchild, foster child, stepbrother, or stepsister will also qualify for the relationship test. It is also possible for the child to be a descendant of any of these people. This means grandchildren, nieces, and nephews can sometimes meet this test. According to the IRS, adopted children and children placed for adoption also qualify.
  • The support test. The third test refers to the level of financial support you provide for your child. Passing the support test requires you provided at least half of their support throughout 2014. A child who provided the majority of their own financial resources does not qualify for a child tax credit.
  •   The dependent test. Meeting the fourth requirement means you must claim the child as a dependent on your 2014 income tax return.
  •  The joint return test. A married child is not permitted to file a joint return with his/her spouse if the sole intention is to claim a tax refund.
  •   The citizenship test. The child is required to be a U.S. citizen, U.S. resident alien, or U.S. national.
  •   Residence test. In most situations, you must prove the child lived with you for more than half of 2014.

 Additional Requirements and Information

While those seven requirements are clear, there are some additional limitations that sometimes come into effect. Depending on your filing status or income level, you may be disqualified from receiving child tax credits. Only those with a modified adjusted gross income less than $110,000 (for those who are married filing jointly), $55,000 (for those who are married and filing separately), or $75,000 (for those who are single and the head of household) can claim the credit.

It’s also worth noting the Child Tax Credit is nonrefundable. In the situation that the tax credit exceeds the tax liability, your tax bill is reduced to zero and the remaining credit is forfeited. However, in some situations, you may be eligible to claim an extra credit. Known as an Additional Child Tax Credit, this allows you to use the unused balance towards your income tax return. Finding out if you qualify is as easy as completing the IRS Form 8812.

 The Vote to Boost Some Child Tax Credits

This past July, the House voted to boost child tax credits to include higher income families by tying the figure to inflation. It also targets illegal immigration by prohibiting people without Social Security numbers from receiving tax credits. As you may guess, the dispute divides Democrats and Republicans.

Democrats typically follow the viewpoint of Rep. Sander Levin of Michigan, who said, “This bill leads to harm for millions of low and middle income families and their children.” The Republican opinion is largely aligned with Rep. Dave Camp of Michigan, who said, “It is time we make some simple improvements to the child tax credit, so it keeps up with the cost of raising children.”

In 2012, 37 million taxpayers claimed the Child Tax Credit. These taxpayers were able to reduce their tax bills by a collective $57 billion. While there is much political debate surrounding the finer details of the credit, nearly everyone agrees some form of tax relief is good. For assistance navigating the Child Tax Credit, discuss your options with a qualified tax professional.

 

Filed Under: Other

Learn About Us

  • About Us
  • Enrolled Agents
  • Groups and Associations
  • Our Tax Resolution Process
  • Seven Reasons to Hire Us

About James Grennen

James Grennen is a Certified Tax Resolution Specialist who is expert in solving IRS tax problems and New York State tax problems. He has decades of financial tax experience in addition to being an IRS Enrolled Agent.

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

Search Form

DOWNLOAD A FREE COPY OF THE ESSENTIAL TAX RESOLUTION GUIDE

Cover of the Guide

Your information is safe with us.

Attorney Plus Program

Long Island Tax Resolution Services is Not a Law Firm of Attorney Practice


Please click here to see why our Attorney Plus Program is the smartest way to resolve your IRS or State tax problems.

Be Smart Check List

IRS On Enrolled Agents :

"The Enrolled Agent is the most expansive license that the IRS grants a tax professional.

An Enrolled Agent has earned the privilege of representing taxpayers before the IRS.

Enrolled Agents are generally unrestricted as to which taxpayers they can represent, what types of tax matters they can handle and the IRS offices before which they can practice."


IRS Publication 4693A
(A Guide to the Enrolled Agent Program)

Man trapped by tax

NYS Tax Warrants: What Every Taxpayer Needs to Know

Man thinking. New York State Tax Problems FAQ

10 Frequently Asked Questions about New York State Tax Problems

Top 4 NY State Department of Taxation Collection Actions

Top 4 NY State Department of Taxation Collection Actions and What to Do About Them

Offer In Compromise (OIC): Tips To Getting Yours Accepted

The Penalties for Failing to File a Return or Pay Taxes

Footer

LITRS Company Profile

Long Island Tax Resolution Services specializes in providing affordable solutions to both individuals and small businesses experiencing back tax problems. These are either IRS tax problems or State tax problems.

Resources

Our Process

Privacy Policy

Recent Posts

  • NYS Tax Warrants: What Every Taxpayer Needs to Know
  • 10 Frequently Asked Questions about New York State Tax Problems
  • Top 4 NY State Department of Taxation Collection Actions and What to Do About Them
  • Offer In Compromise (OIC): Tips To Getting Yours Accepted
  • The Penalties for Failing to File a Return or Pay Taxes

Tags

Innocent Spouse Relief IRS Back Taxes IRS Bank Levy IRS Hardship irs notices IRS Offer IRS Penalties IRS Plans IRS Tax Relief IRS Tax Services IRS Wage Garnishment Tax Debts Tax Returns

Locations

Head Office (map above)
    80 Orville Drive, Suite 100Bohemia, NY 11716
    Phone: (631) 244-1650
    Fax: (720) 294-1650
Manhattan Location
    5 Penn Plaza, 23rd FloorNew York, NY 10001
2nd Long Island Location
    626 Rexcorp PlazaWest Tower, 6th FloorUniondale, NY 11556
Westchester Location
    50 Main St, 10th FloorWhite Plains, NY 10606

© Copyright 2014 - 2017 Long Island Tax Resolution Services · All Logos & Trademark Belongs To Their Respective Owners·