The Child Tax Credit (CTC) is one of the most valuable tax breaks available to American families with children. It directly reduces the amount of income tax you owe — dollar for dollar — rather than just reducing taxable income. For millions of families, it is the single largest factor in determining whether they owe money at tax time or receive a refund. Understanding how it works, who qualifies, and how to claim it ensures you do not leave money on the table.
2026 Child Tax Credit Amount
For tax year 2025 (filed in 2026), the Child Tax Credit is $2,000 per qualifying child under age 17. Up to $1,700 of that amount is refundable as the Additional Child Tax Credit (ACTC) — meaning you can receive it even if you owe less than $2,000 in taxes.
Note: The doubled Child Tax Credit from the 2017 Tax Cuts and Jobs Act is scheduled to revert to $1,000 per child after 2025 unless Congress acts. Legislation to extend or expand the credit has been actively debated. Check the IRS website or a tax professional for the latest status when you file.
Who Qualifies as a Qualifying Child
To claim the credit, the child must meet all of the following IRS tests:
- Age: Must be under age 17 at the end of the tax year
- Relationship: Must be your child, stepchild, foster child, sibling, step-sibling, half-sibling, or a descendant of any of these
- Dependent: Must be claimed as a dependent on your tax return
- Residency: Must have lived with you for more than half the tax year
- Financial support: Must not have provided more than half of their own financial support
- Social Security number: Must have a valid SSN issued before the due date of your return
- Citizenship: Must be a U.S. citizen, U.S. national, or U.S. resident alien
Income Limits and Phase-Out
The full $2,000 credit is available to taxpayers with modified adjusted gross income (MAGI) below:
- Married filing jointly: $400,000
- Single, head of household, married filing separately: $200,000
Above these thresholds, the credit phases out by $50 for every $1,000 of income over the limit. At $440,000 (married filing jointly) for two children, the credit phases out entirely.
The Additional Child Tax Credit (Refundable Portion)
The refundable portion — up to $1,700 per child in 2025 — is called the Additional Child Tax Credit. This matters if your total tax liability is less than the credit. For example, if you owe $800 in taxes and have a $2,000 Child Tax Credit, the first $800 eliminates your tax bill; you can then receive up to $1,700 of the remaining $1,200 as a refund through the ACTC.
To claim the ACTC, you must have earned income of at least $2,500. The refundable amount is calculated as 15% of your earned income above $2,500, up to the per-child limit.
How to Claim the Child Tax Credit
The credit is claimed on your federal tax return (Form 1040). Attach Schedule 8812, Credits for Qualifying Children and Other Dependents, to calculate the credit and the refundable portion. If you use tax software (TurboTax, H&R Block, FreeTaxUSA), it calculates and applies the credit automatically when you enter your dependents’ information.
Other Child-Related Tax Benefits
The Child Tax Credit is the largest, but not the only child-related tax benefit:
- Child and Dependent Care Credit: Covers up to 35% of qualifying childcare expenses (up to $3,000 for one child, $6,000 for two or more) to enable you to work or look for work. Separate from the CTC.
- Dependent Care FSA: Up to $5,000 per household in pre-tax dollars through your employer to pay for qualifying childcare expenses.
- Earned Income Tax Credit (EITC): A separate credit for low-to-moderate income workers. Having children significantly increases the EITC benefit amount.
- Education credits: The American Opportunity Tax Credit and Lifetime Learning Credit apply to college-age dependents.
Bottom Line
The Child Tax Credit is one of the most straightforward and high-value tax benefits available to families. If you have a qualifying child under 17, claim it. If your income is below the phase-out thresholds, the full $2,000 credit directly reduces your tax bill — and up to $1,700 comes back as a refund even if you owe little or nothing in taxes. Use tax software or consult a tax professional to ensure you capture every dollar you are entitled to.