There’s talk of the Child Tax Credit being expanded to $3,600 per child as it was in 2021 and claimants need to be aware of the current situation. According to the official IRS website, the amount has not been increased for 2025. There are ongoing discussions about raising the CTC and this may come to pass in the future. However, for now, Americans should only count on the original figure set for the 2025 credit, which is significantly lower but will still be welcomed.
You can find information on the confirmed CTC amount, the refundable portion, the eligibility criteria, and the application process below.
What is the confirmed CTC for 2025?
There are millions of families across the United States who depend on the annual Child Tax Credit to offset their taxes and assist with the costs of raising children. The funds are intended to cover essentials such as housing, food, clothing, and healthcare and the credit can be claimed for dependents aged from birth to 17 years.
This year, the Child Tax Credit is $2,000 per child. This doesn’t mean that you will be refunded $2,000 in cash if you have credit left after covering your tax liability because only a portion of the CTC is refundable. This amount is $1,700 (referred to as the Additional Child Tax Credit). What this means is that after paying your taxes, the credit will be paid out to you up to a maximum of $1,700 per child. This will be less if some of the refundable amount was used to cover your taxes.
Eligibility criteria for the 2025 Child Tax Credit
These are the eligibility criteria for the CTC:
- Child’s age: The maximum age for each child is 17 years and this applies to their age at the end of the tax year for which you are claiming the credit.
- Citizenship: The minor must be a US citizen, US national, or US resident alien.
- Relationship: The child must have one of the following relationships to the taxpayer: child, stepchild, foster child, sibling, or a descendent of any of these, for example, grandchild, niece, nephew).
- Residency: The child must have lived with the tax filer for more than half the year.
- Financial support: The child must not have provided more than half of their own financial support during the tax year (such as if they are employed part-time and cover their own expenses).
There are also income limits that apply according to taxpayers’ modified adjusted gross income (MAGI), which means that filers who earn above a threshold won’t be eligible for the CTC, or they may receive only a portion of it. For individual taxpayers, the threshold is $200,000 per year. The amount is exactly double for those who file jointly at $400,000.
How to claim the 2025 CTC
This is the procedure to claim the Child Tax Credit on your tax return:
- File your federal tax return by completing Form 1040 or Form 1040-SR.
- Complete Schedule 8812, which calculates the credit amount and what your refund will be.
- Submit the necessary documentation and make sure you have each qualifying child’s Social Security number and any other necessary additional documents.
What do you do if your claim is rejected?
There may be ways to rectify your CTC claim if you submitted incorrectly, so if it was rejected, take the following steps:
- The IRS sends a notice explaining why your claim was denied, so you should read and understand it.
- Ensure all dependent information is accurate, including Social Security numbers, as an error may have been made in entering the information.
- If you believe the denial was incorrect, you can file an appeal via the Taxpayer Advocate Service.
- Contact the IRS through any of their official channels, such as email, on the website, or by phone, if you need further support.
To maximize credits and refunds, taxpayers are reminded to file their taxes correctly and ahead of the deadline to avoid complications later on. In addition to the CTC, filers can claim another credit called the EITC (Earned Income Tax Credit).