OLT TAX CORNER ~ Child Tax Credit

Child Tax Credit FAQ

1.	What is the child tax credit?
2.	Does the Form 8332 (used to release the exemption to the noncustodial parent) affect the Child Tax Credit?
3.	My daughter did not turn 17 until March 24th. Why am I not receiving a child tax credit?
4.	Why did I get the EIC but not the child tax credit this year on my tax return?
5.	My ex-wife is claiming my son as a dependent this year. Can I still claim him for the Child Tax Credit?
6.	What is the Additional Child Tax Credit?
7.	What is the maximum amount I can receive for the Additional Child Tax Credit?
8.	Are there any special forms I need to fill out in order to claim the Additional Child Tax Credit?

What is the child tax credit?	Top
This credit is for people who have a qualifying child. A qualifying child for purposes of the child tax credit must be all of the following: Claimed as your dependent on Form 1040 or Form 1040A. Under age 17 at the end of the tax year. Your son, daughter, adopted child, stepchild, or a descendant of any of them (for example, your grandchild); brother, sister, stepbrother, stepsister, or a descendant of any of them (for example, your niece or nephew), whom you cared for as you would your own child; foster child (any child placed with you by an authorized placement agency whom you cared for as you would your own child). A U.S. citizen or resident alien.
Does the Form 8332 (used to release the exemption to the noncustodial parent) affect the Child Tax Credit?	Top
Yes. The Child Tax Credit can only be claimed by the parent claiming the exemption. In this case the noncustodial parent would qualify for the dependency exemption and therefore the child tax credit.
My daughter did not turn 17 until March 24th. Why am I not receiving a child tax credit?	Top
You are not receiving the child tax credit because your daughter turned 17 in the tax year. This credit is for children under the age of 17 as of the end of the tax year.(Example: In 2011 you are filing the 2009 tax return, your child must still be at age 16 as of December 31, 2009 in order to qualify.)
Why did I get the EIC but not the child tax credit this year on my tax return?	Top
There are a couple of reasons why you could qualify for EIC but not for the child tax credit. One, your child could be over 17, therefore disqualifying you for the credit. Two, if you did not have any taxes owed after the standard deduction and exemptions, then you would not get the child tax credit. The child tax credit reduces the amount of tax that you owe. If you don’t owe any, there is nothing to reduce. The earned income credit is a refundable credit, as long as you qualify for it you will get it whether you still owe tax or not.
My ex-wife is claiming my son as a dependent this year. Can I still claim him for the Child Tax Credit?	Top
No, only the parent who is claiming the exemption can claim the Child Tax Credit.
What is the Additional Child Tax Credit?	Top
The additional child tax credit allows a portion of the child tax credit to be refundable for certain taxpayers. Taxpayers must complete Form 8812 to compute the refundable portion of the credit. Taxpayers with one or more qualifying children may be able to claim the additional child tax credit.
What is the maximum amount I can receive for the Additional Child Tax Credit?	Top
You could receive up to $1,000 per child. This is a partially refundable credit, which means even if you owe no federal income tax, you may even be entitled to a refund.
Are there any special forms I need to fill out in order to claim the Additional Child Tax Credit?	Top
Form 8812 must be completed and attached to Form 1040 to figure and claim your Additional Child Tax Credit.