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Congress has increased the child tax credit for this tax season. It seems that with the state of the current economy even congress is getting into the act of helping take the burden off of the family. One of the nice parts about the child tax credit is that it is a credit taken after your personal child exemptions. This makes it a dollar for dollar reduction in the amount of tax you may owe.
The credit is limited to 1,000.00 per qualifying child you have residing in the U.S and must be under 17 before December 31 and must be living with you more that 6 months during the year.
If you will not be obliged to pay any tax, you can qualify for the refund if you meet other required set standards. One area of change is the income upper limit; it has been reduced from 8,500 to 3,000 for this tax year. In other words if you have one or more eligible children and have an AGI of more than 3,000, you may qualify for the refund.
You must meet the following conditions for the child tax credit.
* Married filing jointly up to $110,000.00 * Single, qualifying widow(er), or head of household up to $75,000.00 * Married filing separately up to $55,000.00
If you AGI exceed the above conditions you may still get the credit but you must reduce the credit by 50.00 dollars for every 1,000.00 dollars over the above limits. For example if your income is 140,000.00 you would reduce you credit by 3 times 50.00 or 150.00.
In addition if you had to reduce your tax credit you may be eligible for the additional child tax credit.
The additional child tax credit is provided for tax payers that may not get the full tax credit. Unlike the child tax credit you can get a refund even if your taxes are zero.
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