IRS Child Tax Credit

The IRS child tax credit rules can be confusing. The following will instruct you  where to go for additional information about this federal government tax break for people with qualifying dependents.

 IRS Child Tax Credit

Individuals will find information on the federal tax credit for dependents beginning on page 42 of the 2009 Form 1040 instructions. Taxpayers will also need to refer to page 17 of the 2009 Form 1040 instructions in order to determine if they have any qualifying children for the 2009 child tax credit.

Some taxpayers will need to refer to Publication 972 for further guidance, as the Child Tax Credit Worksheet in the Form 1040 instructions isn’t comprehensive enough to consider all tax situations. As a taxpayer reviews the Form 1040 instructions beginning on page 42, he or she will be directed to Publication 972 if necessary.

2009 IRS Child Tax Break Value

At most, taxpayers are allowed $1,000 per qualifying child. Individuals with modified adjusted gross income (AGI) above these thresholds will begin to phase out of the child tax credit:

* Married filing jointly - $110,000

* Single, head of household, or qualifying widow(er) - $75,000

* Married filing separately - $55,000

Who Qualifies for Federal Tax Credit for Dependents

A large number of U.S. taxpayers who have at least one qualifying child, make under a certain amount of income, and don’t partake in advanced income tax planning strategies will qualify for the child credit. Many people wonder how many children per household are eligible for the credit. There is really no cap on this, except that the child credit cannot reduce tax liability below zero (resulting in a refund of the excess).

In a nutshell, anyone caring for a dependent who is eligible for the child tax credit may claim up to $1,000 for that child. Certain income limitations and other bars to claiming the full $1,000 tax credit per child exist, but those exceptions are too numerous and dependent upon intermingling factors to be listed definitively in a single article. Only a taxpayer who completes the Child Tax Credit Worksheet in Publication 972 or the Form 1040 instructions will be able to tell for sure how much of a credit he or she is eligible for.

IRS Rules On Child Tax Credit

There are a multitude of reasons someone would not qualify to take the dependent tax credit. Among other limitations, the child tax credit phases out over varying income levels depending on filing status, dependents must be under a certain age, no one else can claim the same child, and the taxpayer must provide over half of the child’s support during the tax year.

How to Claim  Child Tax Credit

There is no special form required to claim the child tax credit. Individuals must claim the amount on their individual income tax returns. However, Form 1040EZ and Form 1040NR-EZ cannot be used to claim the federal tax credit for children and other dependents. One of the following IRS forms are required: Form 1040, Form 1040A, or Form 1040NR.

Below is exactly where taxpayers need to claim a child tax credit on each tax form (once it is calculated using the Child Tax Credit Worksheet in Publication 972 or the individual income tax return instructions):

* Form 1040 – Line 51

* Form 1040A – Line 33

* Form 1040NR – Line 47

Common Questions on Tax Credit

taxes issues are complex, but all of the information needed to prepare individual federal income tax returns is available online at irs.gov. Any questions that can’t be answered by documents accessed online can be addressed by calling the IRS hotline.