The Child Tax Credit Just Got Bigger: Do You Qualify?

The child tax credit is a valuable federal tax break for families, aimed at helping defray the costs of raising children.

Taxpayers who qualify can cut their tax bill by up to $2,200 in 2025, up from $2,000 in 2024, for each qualifying dependent under age 17. And some taxpayers may qualify for up to $1,700 of that to be paid out to them as a refund, as part of the additional child tax credit.

The child tax credit is one of a few tax breaks eligible taxpayers with dependent children can claim. Don’t confuse it with the child and dependent care credit, which helps offset the costs of child care, or the earned income tax credit, for lower-income working people. Plus, there’s a credit for other dependents — those that don’t qualify for the child tax credit — worth up to $500 (its name is just that: credit for other dependents).

Keep in mind that a tax credit reduces your tax bill dollar-for-dollar, unlike a tax deduction, which simply reduces how much of your income is subject to taxes.

How to qualify for the child tax credit

To qualify for the child tax credit, you must meet some specific requirements:

• Each qualifying child must be under age 17 at the end of the tax year. For example, your child must be 16 or younger at the end of 2025 if you want to claim the child tax credit on your 2025 tax return, which is due April 15, 2026.
• If your modified adjusted gross income (MAGI) exceeds certain thresholds — $400,000 for married couples who file jointly and $200,000 for all other filers — your credit amount is reduced by $50 for each $1,000 of income exceeding the threshold. For most taxpayers, their MAGI for the child tax credit is the same as their AGI. (MAGI for the purposes of the child tax credit is calculated by adding these items back into your AGI: income you excluded as a resident of Puerto Rico or American Samoa, foreign earned income and housing that you excluded from your income, and the tax deduction for foreign housing.)
• Each qualifying child must be a U.S. citizen, U.S. national or resident alien and have a valid Social Security number.
• As of 2025, the taxpayer claiming the child tax credit also must have a Social Security number (if it’s a married-filing-jointly return, at least one of the spouses must have a Social Security number).
• The child must be a legally recognized child, stepchild, foster child, sibling, half-brother or half-sister or a descendant of one of these categories (such as a grandchild, niece or nephew).
• The child must not have provided more than half of their own financial support for the year.
• The child must have lived with you for more than half of the year.
• You must claim the child as a dependent on your tax return.

If you meet all the eligibility factors, including the income requirements, you can claim the full $2,200 credit per eligible dependent child for 2025 ($2,000 in 2024). Taxpayers with higher incomes may claim a partial credit.

For example, if you’re married and filing jointly with two qualifying children and your modified adjusted gross income is $350,000, then you can claim $4,400 ($2,200 per child). However, the amount you can claim is phased out if your household income, as married filing jointly taxpayers, is greater than $400,000.

How to claim the child tax credit

Most reputable tax software products will calculate your eligibility for the child tax credit and the refundable additional child tax credit.

But if you’re wondering how the credit is calculated, check out IRS Schedule 8812. Completing that form tells you how much of the child tax credit you can claim, including any refundable portion (aka the additional child tax credit). The IRS has step-by-step instructions on how to fill out Schedule 8812.

Or you can consult with a tax preparer to determine if you’re eligible for the child tax credit based on your income and filing status. Here are five tips to find the best tax preparer for you.

The additional child tax credit: How it works

If you break even on your taxes — that is, you don’t owe any money — then the child tax credit can’t help you. However, you may qualify to claim the additional child tax credit.

This refundable portion of the child tax credit allows you to receive up to $1,700 per qualifying child in 2025 as a refund — even after your tax bill is reduced to zero. (The amount of the additional child tax credit is adjusted for inflation each year.)

The additional child tax credit is calculated at 15 percent for every dollar of earned income starting at $2,500. Again, filling out Schedule 8812 can help you calculate the amount of your refundable child tax credit.

Some states also offer child tax credits

In addition to the federal child tax credit, 17 states plus the District of Columbia offer a child tax credit, according to the National Conference of State Legislatures: Arizona, California, Colorado, Georgia, Idaho, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey,  New Mexico, New York, Oklahoma, Oregon, Utah and Vermont.

And 12 of those 17 states, plus the District of Columbia, have made their child tax credit refundable: California, Colorado, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey,  New Mexico,  New York, Oregon and Vermont.

Eligibility and benefits vary, so check with your state tax website for details.