The Child Tax Credit can provide significant financial benefits for families with qualifying children. Learn about common mistakes to avoid, including filing before obtaining the child's Social Security number and using outdated tax information. Ensure you maximize your refund by understanding the eligibility requirements and claiming the credit accurately.
For 2024 tax returns, the child tax credit is worth up to $2,000 per child under age 17, and decreases once adjusted gross income exceeds $200,000 for single taxpayers or $400,000 for married couples filing jointly. The refundable portion, known as the additional child tax credit (ACTC), is up to $1,700. Filers can claim the ACTC even without owing taxes, which often benefits lower earners.
However, a lower-income family who doesn't know how to claim the credit 'misses out on thousands of dollars,' according to the National Taxpayer Advocate.The rules can be 'very confusing,' according to Tom O'Saben, an enrolled agent and director of tax content and government relations at the National Association of Tax Professionals. One common mistake is filing for the child tax credit before obtaining the child's Social Security number. You may avoid some eligibility errors by filing via tax software or using a preparer versus filing a paper return on your own, O'Saben said. Tax software typically includes credit eligibility, which can minimize errors. The IRS advises families to wait for the Social Security card before filing to ensure accuracy and avoid potential delays.Getting a Social Security number for a newborn can take weeks from application to receive that number, according to the agency, which can create time pressure for families with a new addition around tax season. 'I have seen dependents denied for people who have filed before they got the Social Security number for a dependent,' O'Saben said. 'And there's no going back.'
CHILD TAX CREDIT TAX REFUND SOCIAL SECURITY NUMBER TAX MISTAKES TAX PREPARATION
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