The Child Tax Credit is worth up to $2,200 per qualifying child under age 17 for the 2025 tax year, and it reduces your federal income tax dollar for dollar.1Internal Revenue Service. Instructions for Schedule 8812 (Form 1040) – Credits for Qualifying Children and Other Dependents The One Big Beautiful Bill Act, signed in 2025, raised the credit from $2,000 and tied future amounts to inflation, so the per-child figure will drift upward over time.2Congress.gov. H.R.1 – 119th Congress – An Act to Provide for Reconciliation If the credit is larger than the tax you owe, up to $1,700 per child can come back to you as a refund.
How Much You Can Get
The base credit is $2,200 per qualifying child under 17. Starting with the 2026 tax year, the IRS adjusts that figure for inflation, with any increase rounded down to the nearest $100.2Congress.gov. H.R.1 – 119th Congress – An Act to Provide for Reconciliation A family with three qualifying children subtracts $6,600 from their federal income tax before any refund or balance is figured.
The Refundable Portion
If your tax bill is smaller than the credit you qualify for, the Additional Child Tax Credit lets you receive up to $1,700 per child as an actual refund.1Internal Revenue Service. Instructions for Schedule 8812 (Form 1040) – Credits for Qualifying Children and Other Dependents You need at least $2,500 in earned income to get any refundable amount.3Internal Revenue Service. Child Tax Credit The refundable piece then equals 15 percent of your earned income above $2,500, capped at $1,700 per child. Low-income families who owe little or no federal tax can still benefit, and the refund grows as earnings rise.
Income Phase-Out
The credit shrinks for higher earners. Phase-out begins at $200,000 of modified adjusted gross income for single filers and $400,000 for married couples filing jointly.1Internal Revenue Service. Instructions for Schedule 8812 (Form 1040) – Credits for Qualifying Children and Other Dependents For every $1,000 of income above the threshold, the credit drops by $50. A single parent earning $220,000 with one child would lose $1,000 of the credit and be left with $1,200. At high enough incomes the credit disappears entirely.
Which Children Qualify
A child has to pass four tests, all drawn from the federal definition of a qualifying child.
- Age. The child must be under 17 at the end of the tax year. A child who turns 17 on December 31 does not qualify for that year.
- Relationship. The child must be your son, daughter, stepchild, foster child, sibling, step-sibling, or a descendant of any of these (a grandchild or niece, for example). Legally adopted children and children lawfully placed with you for adoption count the same as biological children.4Office of the Law Revision Counsel. 26 USC 152 – Dependent Defined
- Residency. The child must live with you for more than half the year. Temporary absences for school, medical care, or military service generally don’t break this test.4Office of the Law Revision Counsel. 26 USC 152 – Dependent Defined
- Support. The child cannot have provided more than half of their own financial support during the year.
A child born at any point during the tax year qualifies for the full credit for that year, even if the birth happens on December 31, as long as all four tests are met.5Internal Revenue Service. Dependents 8 You must also claim the child as a dependent on your return.
Social Security Number Rules
Each child you claim must have a Social Security Number issued before the due date of your return, including extensions.6Internal Revenue Service. Dependents 9 An ITIN does not satisfy this requirement. If the name or number on your return doesn’t match Social Security Administration records exactly, the IRS will reject the credit automatically. Under the One Big Beautiful Bill Act, both parents filing the return may also need valid Social Security Numbers themselves to claim the credit, a change from prior rules that only required the child’s SSN.2Congress.gov. H.R.1 – 119th Congress – An Act to Provide for Reconciliation
Divorced or Separated Parents
When parents live apart, the custodial parent (the one the child lived with for the longer part of the year) is typically the one who claims the credit. The noncustodial parent can claim it instead, but only if the custodial parent signs IRS Form 8332 releasing the claim.7Internal Revenue Service. Dependents 3 The noncustodial parent must attach that signed form to their return every year they claim the credit.8Internal Revenue Service. Form 8332 – Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent If both parents claim the same child without this form on file, expect processing delays and a possible audit.
If Your Child Is 17 or Older
Children who are 17 or older don’t qualify for the main credit, but you may still claim the Credit for Other Dependents, a separate nonrefundable credit worth up to $500 per dependent.9Internal Revenue Service. Understanding the Credit for Other Dependents Unlike the Child Tax Credit, this one allows dependents who have an ITIN instead of a Social Security Number. Full-time students between 19 and 23 who still qualify as your dependents fall into this category. The same $200,000 and $400,000 phase-out thresholds apply, and you report it on the same Schedule 8812.
How to Claim It
You calculate the Child Tax Credit, Additional Child Tax Credit, and Credit for Other Dependents on Schedule 8812, filed with your Form 1040.1Internal Revenue Service. Instructions for Schedule 8812 (Form 1040) – Credits for Qualifying Children and Other Dependents The form asks for each dependent’s name, SSN or ITIN, and relationship, and walks you through the earned-income calculation that determines your refundable amount. Most tax software fills this out automatically once you enter your dependents on the main return.
When Your Refund Arrives
E-filed returns are generally processed within 21 days.10Internal Revenue Service. Processing Status for Tax Forms If your refund includes the Additional Child Tax Credit, though, federal law delays it. Under the PATH Act, the IRS cannot release any refund that includes an ACTC or Earned Income Tax Credit before mid-February, even if you filed in January. The hold applies to your entire refund, not just the credit-related portion.11Internal Revenue Service. When to Expect Your Refund if You Claimed the Earned Income Tax Credit or Additional Child Tax Credit The IRS uses that window to cross-check your income against employer-filed W-2s and 1099s before refunds go out.
Penalties for Claiming It When You Shouldn’t
Claiming the credit when you don’t qualify has consequences beyond paying the money back. If the IRS finds your claim was reckless or showed intentional disregard of the rules, you’re banned from claiming the Child Tax Credit, Additional Child Tax Credit, and Credit for Other Dependents for two years. If the improper claim rises to fraud, the ban stretches to ten years.12Internal Revenue Service. What to Do if We Deny Your Claim for a Credit
The IRS can also impose a penalty equal to 20 percent of the excessive amount claimed.13Internal Revenue Service. Erroneous Claim for Refund or Credit Once a ban expires, you can’t simply resume claiming the credit. You must first file Form 8862 to show you now meet all the eligibility requirements before the IRS will process the credit again.14Internal Revenue Service. Information To Claim Certain Credits After Disallowance
State Child Tax Credits
The federal credit isn’t the only one available. At least 15 states offer their own child tax credits on top of the federal benefit, with amounts ranging from roughly $100 to $1,000 per child depending on the state, the child’s age, and household income. Some state credits are refundable and others only reduce state tax liability. If your state offers one, it’s calculated on your state return separately from the federal credit. Check your state tax agency’s website for specific eligibility rules and amounts, since these programs change frequently.