Are You Set To Collect Your Child Yax Credit? – Did You File Them Properly?

How to collect your child tax credit

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Author: Anderson Geoffrey

You may be eligible for the most significant Child Tax Credit increase in the history of the U.S.A. For the first time, you can claim up to $3,000-$3,600 per child in tax credit. 

But have you claimed your Child Tax Credit (CTC)? If you haven’t, then keep reading to learn more about your CTC and how to collect it.

What is Child Tax Credit?

In 1997, the United States introduced the Child Tax Credit (CTC) as part of the 1997 Taxpayer Relief Act. This type of Tax Credit is made for parents with dependent children and is partially refundable. 

In 2021, the Child Tax Credit saw its biggest increase where it provided tax reliefs of $3,600 each for children below six years and $3,000 for children between the age of 6 to 17 years old. 

However, the credit will return to its prior value in 2022, which was established under the 2017’s TCJA (Tax Cuts and Jobs Act). This means that the CTC amount will be back to $2,000 each for children under 17 years.

Furthermore, President Biden’s Administration seeks to extend the 2021 tax increase for an additional year.

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Who is Eligible for Child Tax Credit?

Any taxpayer who meets the requirements below is eligible for the Child Tax Credit. 

  • For full benefits, your annual earnings must be less than $75,000 if you’re a single parent. On the other hand, married couples must earn below $150,000. But, single parents who make below $240,000 or married couples earning below $440,000 are still eligible for some CTC.
  • A citizen who have stayed in the U.S. for over six months in that tax year. 
  • The child in question must either be your child, grandchild, sibling, nephew/niece, great-nephew/niece, step relative, half-relative, or foster relative.
  • A Social Security Number is required from the parent and child. The parent or tax filer can also use a Taxpayer Identification Number (ITIN).
  • The child must be below 17 years. But it was increased to 18 years for 2021.
  • You must have lived with the child for at least six months within the year. 
  • The child must not be responsible for more than half of their living expenses.

How to Collect Child Tax Credit?

Getting your CTC (Child Tax Credit) is as simple as filing a tax return. You still have to file a tax return even if you received monthly payments in 2021. 

Most people who collected the advanced monthly payment received $1,800 per child (under six years) and $1,500 per child under the age of eighteen. However, people who didn’t receive any monthly payments are eligible to collect their total CTC, which is $3,600 for a child under six years and $3,000 per child under eighteen years.

What happens if You Miss the Tax Filing Deadline?

The deadline for filing a tax return was set for 18 April 2022. This means you have missed the deadline if you haven’t filed a tax return. But it’s not too late. You can still file for a tax return without penalty for missing the tax filing deadline. You can also request a deadline extension that lasts till October. Regardless, you must file to claim your CTC before 2025, or else the money becomes the property of the U.S. Treasury. 

Conclusion

Child Tax Credit (CTC) is an incredible program specially created to enhance of lives of low and middle-class families. If you have a child between the age of 6 – 17 years, you might be leaving some money on the table.

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