Families are looking forward to the possible enhancement of the Child Tax Credit (CTC) in 2024. After significant improvements were implemented in 2021, it is planned to further expand the CTC in 2024 in order to increase its accessibility for a greater number of families.
CTC 2024 Updates
The Child Tax Credit (CTC) is a government-mandated tax benefit that offers qualifying families with qualifying dependent children financial support to ease the financial strain of raising a child by either lowering tax liabilities or boosting tax refunds.
The number of qualified children and household income determine the credit amount. The CTC was extended in 2021 by the American Rescue Plan Act, which also increased the maximum credit amount, extended eligibility to more families, and made the credit entirely refundable.
Raising the credit limit and broadening the pool of eligible applicants, aims to help children escape poverty. The House of Representatives has already approved the Tax Relief for American Families and Workers Act of 2024, and the Senate is currently debating it.
If approved, it will put the suggested extension of the Child Tax Credit into effect.
Eligibility Criteria For CTC 2024
| Citizen | Parents and child must be citizens of the USA |
| Age | Under the age of 17 years. |
| Relation | Relation of a child with family should be as follows:-
biological child, stepchild, foster child, adopted child, sibling, half-sibling, or a descendant of any of these (such as a grandchild, niece, or nephew). |
| Residency | The child must have lived with their family for at least 6 months in the year. |
| Dependency | Parents must be claiming their child as a dependent on their tax return. |
| Social security number | Parents and children must have a social security number. |
| Income | Modified Adjusted Gross Income (MAGI) must be below a specific threshold:
● Married Filing Jointly: Under $400,000 ● Single/Head of Household: Under $200,000 |
| Financial support | Parents must have provided over half of the child’s financial support during the financial year for which they will claim the tax credit. |
CTC Amount
$2,000 will be the proposed payment amount for each qualifying kid under the age of 17 as of December 31st, 2023, for the child Tax Credit expansion in 2024 (to be submitted in 2025) and 2023 (to be filed in 2024).
If it is approved, then the credit amount may increase, although specific details are still being awaited.