The Child Tax Credit 2021 is basically a tax benefit that is granted to American taxpayers for each of their qualified dependent children. It is designed to support and help taxpayers support their families.
It decreases taxpayers’ tax liability on a dollar-for-dollar basis. The recently released legislation increased the maximum annual credit from $2,000 per child (under 17) in 2020 to $3,000 per child (under 18) or $3,600 (children younger than 6) for 2021.
Child Tax Credit 2021
While the 2020 credit was partially refundable, the 2021 credit is fully refundable and in addition, the 2021 child tax credit will be highly distributed to eligible taxpayers in advance payments, possibly beginning on a monthly basis as early as July 2021.
We would be giving you a more detailed explanation of what child tax credit 2021 is all about as we proceed in this article
What is the Child Tax Credit For 2021
For 2022, the child tax credit is $3,000 per child from ages 6 through 17; and $3,600 for children under age 6. Under the former law, the tax credit was $2,000 per child under the age of 17. This new law increased the amount of the credit and also increased the age limit to under age 18
How The Child Tax Credit Work
The child tax credit is simply a tax credit that provides a financial benefit to Americans with children
Can You Claim The Child Tax Credit With No Income?
The new provision allows households who are with no income to claim the credit, this a major change due to the fact that the previous rule limited the credit to those that are earning at least $2,500
When You Should Stop Claiming A Child As A Dependent
For your child to qualify for the credit, Your child must be younger than you and either younger than 19 years old or be a “student” younger than 24 years old as of the end of the calendar year and there is no age limit if your child is “permanently and totally disabled” or meets the qualifying relative test
The Requirements to Claim the Child Tax Credit
For those who want to claim the credit, you must first determine if your child is eligible or not, and the basic determinants are age, relationship, support, dependent status, citizenship, length of residency, and family income. You and/or your child must pass all seven to claim this tax credit.
Who is Eligible for Child Tax Credits
You can obtain your Child Tax Credit so far you are 16 or over. If you are under 16 your parents, or someone who is responsible for you, could include you and your child in their own claim
Can you Claim your Child if They Do Not Live With You?
For those who fall into this scenario then you should note that the custodial parent is entitled to claim the child as a dependent instead and without the form, you cannot claim a child who did not live with you as a dependent because they are the qualifying child of someone else. More research can be done on Google.