Families With Children - CPA Clinics
The full amount of the Child Tax Credit is refundable.
Age 6 to age 17: $3,000 Under age 6: $3,600
The increased credit amount ($1,000 or $1,600) phases out by $50 for each $1,000 of modified AGI above:
Maximum credit if phased out of increased credit: $2,000 per qualifying child under age 18.
The $2,000 credit is reduced by $50 for each $1,000 of modified AGI above:
Maximum credit: $500 per qualifying dependent.
A nonrefundable credit of up to $500 is allowed for dependents other than a qualifying child for the Child Tax Credit.
The credit is up to 50% of the smallest of:
Note: For 2021, the credit is refundable if your principal place of abode is in the United States for more than half the year.
Instead of taking the credit, you may be eligible to exclude from income an amount up to $10,500 for dependent care benefits received under an employer plan.
The EIC is a refundable credit for low-income earners.
Note: For purposes of calculating the EIC, 2019 earned income may be used if 2021 earned income is less than 2019.
The following requirements must be met whether or not you have qualifying children.
• Valid Social Security Numbers. You and your spouse (if filing jointly) must have valid Social Security Numbers. Qualifying children must also have valid Social Security Numbers except a child who was born and died during the year. Adoption and individual taxpayer identification numbers (ATINs and ITINs) do not qualify. A Social Security Number on a card that reads “Not Valid for Employment” does not qualify. A Social Security Number on a card that reads “Valid for work only with DHS (or INS) authorization” qualifies.
• You must be a U.S. citizen or resident alien for the entire year. A nonresident alien can claim the credit if married to a U.S. citizen or resident alien, and the nonresident alien chooses to be treated as a resident for the entire tax year by filing a joint return.
• Filing status may not be Married Filing Separately.
• You may not be a qualifying child of another taxpayer.
• You may not file a tax form relating to foreign earned income.
• Your investment income must be $10,000 or less.
If you meet all the requirements and you do not have a qualifying child for the year, can claim EIC if the following additional requirements are met.
• You must be at least age 24 (if a student), age 19 (if not a student), or age 18 (if former foster or homeless youth).
• You cannot be the dependent of another person.
• Your principal place of abode is in the United States for more than half the year. Residence in U.S. possessions, such as Guam and Puerto Rico, does not qualify.
A taxpayer can claim a credit of up to $14,440 (2021) and also exclude up to $14,440 of employer-provided benefits from income for expenses of adopting an eligible child. The same qualifying expenses cannot be used for both. Limits apply to the total spent over all years for each effort to adopt an eligible child. An attempt that leads to adoption and any unsuccessful attempt to adopt a different child is treated as one effort. Unmarried persons who adopt a child can divide each limit in any way they agree.
A child under age 18 or a person who is physically or mentally unable to care for themselves.
American Opportunity Credit. Credit of up to $2,500 per student for the first four years. 40% of the credit may be refundable.
Lifetime Learning Credit. Credit of 20% of the first $10,000 of qualified education expenses (maximum credit is $2,000). No limit on the number of years the credit may be claimed.
