How the Child Tax Credit Works and Who Can Claim It

What the child tax credit actually does

The child tax credit reduces the federal income tax you owe, dollar for dollar. If you owe $2,000 in tax and you have one child under 17, the credit brings that down to $1,000. If the credit is larger than what you owe, you may get money back — that's called a refund.

The credit is worth up to $2,000 per child under age 17. You claim it on your tax return, and the IRS processes it when they process your return. There is no separate form to fill out beyond your regular tax paperwork.

The credit has changed several times in recent years, and the amount you can claim depends on your income, the number of children, and which tax year you're filing for. The rules that applied in 2023 are different from 2024, which is different from what may happen in 2025.

Key Takeaways

• The child tax credit is worth up to $2,000 per child under 17 and reduces your federal income tax dollar for dollar.
• You must have earned income to claim the credit, and the amount phases out if your income exceeds a certain threshold that varies by filing status.
• You claim the credit on your tax return using Form 1040 and Schedule 8812; you do not apply for it separately.
• If the credit exceeds what you owe in tax, you may receive a refund, but the refundable portion has a limit that changes year to year.
• The credit amount and income limits are set by Congress and can change, so the rules for 2024 may not match 2025.

Income limits and how much you can claim

The full $2,000 credit per child is available if your income is below a certain threshold. That threshold is $400,000 for married couples filing jointly and $200,000 for single filers. If your income is above that, the credit begins to phase out — it reduces by $50 for every $1,000 (or fraction of $1,000) of income over the limit.

For example, if you are single with one child and your income is $210,000, you are $10,000 over the $200,000 threshold. That $10,000 reduces your credit by $500, bringing it from $2,000 to $1,500.

Your income for this purpose is your modified adjusted gross income, which is on your tax return. If you are unsure what your income is, a tax preparer or the IRS can help you calculate it.

Who can claim the credit

You can claim the credit for a child if you meet all of these conditions: the child is your son, daughter, stepchild, foster child, sibling, or descendant of any of these (like a grandchild or niece); the child was under age 17 at the end of the tax year; the child lived with you for more than half the year; you provided more than half the child's financial support; the child is a U.S. citizen, national, or resident alien; and the child has a valid Social Security number.

You must also have earned income during the year — income from work, self-employment, or certain other sources. If you had no earned income, you cannot claim the credit, even if you have children.

Only one person can claim the credit for each child. If parents are divorced or separated, the parent who has custody for the greater part of the year usually claims the credit, unless they sign a form agreeing to let the other parent claim it.

Refundable versus non-refundable portions

Part of the child tax credit is refundable, meaning you can get money back even if you owe no tax. The refundable part is called the Additional Child Tax Credit or the refundable child tax credit. The amount that is refundable changes year to year and is set by Congress.

In recent years, the refundable portion has been as high as $1,600 per child, but it has also been lower. For the current tax year, check the IRS website or your tax software to see what the refundable limit is.

The non-refundable portion means you can only use it to reduce tax you actually owe. If you owe $500 in tax and have a $2,000 credit, the non-refundable part covers the $500, and the refundable part may give you the rest back — up to the refundable limit.

How to claim the credit on your tax return

You claim the child tax credit on Form 1040, the main federal income tax form. You list each child's name, date of birth, and Social Security number. The form itself walks you through the calculation.

If you use tax software, it will ask you questions about your children and calculate the credit for you. If you file by hand or work with a tax preparer, they will fill in the form.

You do not need to send proof of the child's relationship to you or proof that they lived with you unless the IRS asks. Keep records like birth certificates, school enrollment, medical records, or lease agreements in case you need to show them later.

What happens if the rules change year to year

Congress has changed the child tax credit rules multiple times. In 2021 and 2022, the credit was temporarily higher and partially paid out in advance during the year. Those changes expired, and the credit went back to lower amounts in 2023.

Future changes are possible. Before you file, check the IRS website (irs.gov) or use current tax software to see what the rules are for the year you are filing. Do not assume the credit amount or income limits are the same as last year.

If you received advance payments of the credit in prior years and the actual credit you are owed is less, you may have to repay part of it when you file. The IRS will calculate this automatically on your return.

What to do if you think you were denied the credit

If you filed a return and did not claim the credit, or if the IRS denied it, you can file an amended return using Form 1040-X. You have three years from the original due date to amend and claim the credit you missed.

If the IRS sent you a notice saying you do not meet the requirements, read the notice carefully. It will explain which requirement was not met — for example, the child's Social Security number was invalid, or the child did not live with you long enough. You can respond to the notice or file an amended return with corrected information.

If you need help understanding the notice or filing an amended return, the IRS has a free helpline at 1-800-829-1040, and many nonprofits offer free tax preparation services.

Frequently Asked Questions

Can I claim the credit for a child who does not have a Social Security number?

No. The child must have a valid Social Security number. If your child was born in the U.S. but does not have a number yet, you can request one from the Social Security Administration. If your child is not a U.S. citizen or resident alien, they are not may be able to access for the credit.

What if my child turned 17 during the year?

You can claim the credit for that child for the tax year in which they turned 17. Once they are 17 at the end of the tax year, they no longer may have access to. For example, if your child turns 17 on December 31, 2024, you can claim the credit on your 2024 return, but not on your 2025 return.

Can I claim the credit if I did not work during the year?

No. You must have earned income — from a job, self-employment, or certain other sources like unemployment benefits or military housing allowance. If you had no earned income, you cannot claim the credit, even if you have dependent children.

Do I have to file a tax return to get the refundable part of the credit?

Yes. You must file a federal income tax return to claim any part of the child tax credit, including the refundable portion. If your income is very low, you may not be required to file, but you still need to file to receive the refund.

What if my income is above the phase-out threshold?

The credit reduces by $50 for every $1,000 of income over the threshold. You can still claim a credit unless your income is so high that the credit phases out completely. Use the IRS worksheet or tax software to calculate the exact amount you can claim.