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Who is eligible for the revised child tax credit as a dependent? It’s complicated



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Are your children counting towards the 2021 child discount, and for how much?

Angela Lang / CNET

Your kids could bring in thousands of dollars if they meet the age requirement for the new child discount and if so you are eligible. (You can calculate how much you get here.) The age eligibility guidelines differ from the dependent qualifications for the third stimulus check. With the new child discount, the older the child is, the less money the household will receive. We will explain how it works based on what we know so far.

The first child discount payout will ship in July, with monthly payouts through December – the rest of the payout will come in next year. (If you’d rather get one big payment, you can unsubscribe from receiving monthly payments.) Parents of babies born or adopted in 2021 can also receive the checks this year. You can get up to $ 3,600 per qualified child, depending on the age of the child and your age adjusted gross income (AGI). For example, if you have a single income of less than $ 75,000 and you have one child under the age of 6, you qualify for $ 3,600.

The IRS should release more details as the date approaches for the first payment of the child discount. In the meantime, this is how President Joe Biden’s next incentive law could bring in even more money and what we know about a possible fourth stimulus control and forgiveness of student loans. This story has been updated.

Children up to and including 17 years are eligible for a child discount

If you have dependents who are 17 or younger, they can each count towards the new child tax credit (CTC). However, the amount they qualify for depends on their age. Children between the ages of 6 and 17 each count up to $ 3,000. Children under the age of 6 can charge up to $ 3,600 each.

The previous child tax credit offers families $ 2,000 per child ages 16 and under, so adding an extra $ 1,000 to $ 1,600 per child can help families significantly financially. In addition, the new CTC will add 17 year olds to the mix.






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Persons between the ages of 18 and 24 are eligible for partial benefits

If you are a dependent of 18 years old, they can qualify for up to $ 500 each for the amount of the child discount you receive. If you have a dependent between the ages of 19 and 24 who is attending college full-time, they may also qualify for up to $ 500 each for your total amount, according to the new incentive bill.

Babies born this year are also eligible for money

If you expect your baby to arrive before the end of 2021, the newborn is also eligible for up to $ 3,600 for the child discount. This includes children who are adopted, assuming they are US citizens (more below). You will likely be able to use the IRS portal as soon as it becomes available to update your information to add your new family member or you can claim the tax credit when you file your 2021 tax return next year, according to Garrett Watson, a senior policy analyst. at Tax Foundation. While it’s unclear when the portal will open, it’s likely in July when the IRS is expected to send the payments.

What you need to know about dependents with disabilities

Children with disabilities may qualify for the child discount and deduction separately from the child discount, Watson said. You may be able to claim this credit if you paid costs for the care of an eligible dependent to enable you to work, according to the IRS. Watson says the child discount would apply in the same way to children with disabilities.

If you share custody of a dependent, here’s what you need to know about the child discount

Double-dipping benefits for the same child worked for the first two incentive checks, with a loophole entitling unmarried parents to share custody of both claim the child as a dependent, in a specific situation. Which is not the case with the 2021 child discount. In fact, an overpayment can result in you being asked to pay the money back to the IRS.

The dependent must live with you for at least half of the year

When applying for the new child tax credit for your child, keep in mind that they will have to live with you for at least six months a year. However, there are exceptions to this rule, including temporary absence. According to the IRS, “a person is believed to have lived with you during periods when one or both of you is temporarily absent due to special circumstances,” including illness, education, business, vacation, and military service.

A newborn child born later in 2021 also falls under the exception and is considered to be living with you all year round. However, the IRS will be working on the 2020 tax return, which according to Joanna Powell, Certified Financial Planner and general manager at CBIZ, will not have children born in 2021, so don’t forget to update your information in the portal.






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More requirements that your child must meet

If your child isn’t a U.S. citizen and doesn’t have a Social Security number, there’s no getting around this: they don’t qualify. When you file your individual income tax return (Form 1040), be sure to include your family members and their Social Security numbers when you claim them for the child discount.

This also applies to adopted children. An adopted child who is not a U.S. citizen and has an ATIN or ITIN (Adopted / Individual Taxpayer Identification Number) is not eligible for the child discount, according to the IRS. “The child must have an SSN to be an eligible child to be eligible for the child discount.”

In contrast to the third stimulus check, this is true households of mixed status could get a check and only one household member needed a social security number.

For more information, here everything you need to know about the 2021 child discount, when the CTC payments will come and qualifications for parents to receive the payments.


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