The Child Tax Credit can reduce your tax bill by as much as $1,000 per child, if you meet all seven requirements.
The Child Tax Credit is an important tax credit that may save you up to $1,000 for each eligible qualifying child. Be sure you qualify before you claim it. Here are five useful facts from the IRS on the Child Tax Credit:
Here are some important facts about the Child Tax Credit: The Child Tax Credit is intended to offset the many expenses of raising children. The Child Tax Credit can be worth as much as $1,000 per child for 2013 and later Tax Years. For 2014, the Child Tax Credit is at least partially refundable if you had an earned income of more than $3,000 (see the Additional Child Tax Credit). This refundable portion of the credit will expire at the beginning of 2017. For 2014, the Child Tax Credit begins to phase out (decrease in value) at an adjusted gross income of $75,000 for Single filers and Heads-of-Household, $110,000 if Married Filing Jointly, and $55,000 if Married Filing Separately.
Most parents wouldn’t trade the experience of raising children for anything in the world. If only it weren’t so darn expensive. Between the medical bills, child care and college tuition, it’s a wonder parenting hasn’t gone the way of the wet nurse. Fortunately, the government offers some generous tax breaks to help ease the financial burden. It’s up to taxpayers, of course, to take full advantage of them -- and in some cases this can be difficult, since it may involve figuring out which breaks are more beneficial than others. There are a few things parents should understand. First, most child-related deductions and credits are available whether families take the standard deduction or itemize deductions. Second, there’s a difference between deductions and the more coveted tax credits.
Raising children can be expensive, as any parent knows. Knowing what taxpayers are eligible for when they become parents can keep them from paying more in taxes than they owe. Just outfitting a nursery and stockpiling diapers can really add up. According to a “baby-cost” calculator on BabyCenter, parents can expect to spend $72 per month on disposable diapers and $76 per month on a cloth diaper service. And of course, day care is likely to be much more expensive. H&R Block advises new parents to make sure they claim all the tax breaks they are eligible to claim, which can help put money in their pocket to cover new expenses. Following are some tax breaks taxpayers need to keep in mind as they file their 2014 tax returns.
Mela Frankfort wishes the current tax code would expand to allow parents who are supporting their grown children while they are living at home and looking for a job. That, of course, is a phenomenon all too familiar for parents of Millennials. Frankfort, who lives in Ventura, Calif., is helping out her 20-year-old son who is an unemployed guitarist. There are no deductions she can take advantage of since he is one year older than the cutoff age required by the IRS for dependent children if you are not a student. “If Americans are helping our struggling adult kids, we should at least be able to write off the space,” she said. “It would just make sense.”
As Tax Day inches closer, you are likely (hopefully) getting your important documents in order. And if you have children, you may be wondering about how much you can claim in the form of a child tax credit. This can be a huge tax saver for parents. However, there are some certain criteria that need to be met, according to the Internal Revenue Service. Here are six things to keep in mind when using the child tax credit, as provided to Patch by the IRS: