Posted by Cindy
on Feb 13, 2012 in Individuals
| 0 comments
Parents, guardians and other taxpayers who are eligible to claim a child as a dependent on their tax return may also be eligible for a federal tax credit of up to $1,000 per child. The Child Tax Credit is one of serveral tax-related benefits for families and children. Remember that a tax credit is different (and in most cases better) than a deduction. The Child Tax Credit is available to “eligible taxpayers” with “qualifying children” under age 17. Be aware that there are additional criteria and not all dependents will qualify.
With the Child Tax Credit, you may be able to reduce your federal income tax by up to $1,000 for each qualifying child under age 17.
A qualifying child for this credit is someone who meets the qualifying criteria of seven tests: age, relationship, support, dependent, joint return, citizenship and residence.
Age Test: To qualify, a child must have been under age 17 – age 16 or younger – at the end of 2011.
Relationship Test: To claim a child for purposes of the Child Tax Credit, the child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister or a descendant of any of these individuals, which includes your grandchild, niece or nephew. An adopted child is always treated as your own child. An adopted child includes (more…)