Depending on your income, the child tax credit can reduce your federal income taxes by up to $1,000 for each qualifying child. Normally, in order to claim the child tax credit the child must have lived with you in your home for more than half the year. But there are certain cases in which you can claim the credit even if the child lived with you for less than six months.
According to the IRS, for purposes of this credit, if a child was born or died during the year, the child is considered to have lived with you for the entire year if your home was the child’s home for the time he or she was alive. So even if your qualifying child was born on December 31st, you could qualify for the child tax credit. You do not have to wait until next year when the child has lived with you for more than six months.
If the child is temporarily away from your home, that time may count as time lived with you. And time you are temporarily away from home can also count as time the child lived with you. The IRS points out temporary absences for circumstances such as for school, vacation, business, medical care, military service, or detention in a juvenile facility.
If you are divorced or separated and you are the noncustodial parent, you may still be able to claim the child tax credit. The child must have received more than half of his or her support from the parents and must have been in the custody of one or both parents for more than half the year (except for temporary absences). If the custodial parent signs a Form 8332 or a similar statement, indicating that he or she will not claim the exemption for the child, you could claim the exemption and the child tax credit as the noncustodial parent.
There are other tests you must meet in order to claim the child tax credit:
Age test: The child must have been under age 17 at the end of the year.
Relationship test: The child must be your son, daughter, adopted child, stepchild, or foster child. The child could also be your brother, sister, stepbrother, stepsister, niece, nephew, grandchild, or great grandchild.
Support test: The child must not have provided more than half of his or her own support.
Dependent test: You must claim the child as a dependent.
Citizenship test: The child must be a U.S. citizen, U.S. national, or a resident of the U.S.
To determine whether you are eligible, you can use the IRS tool Am I Eligible for the Child Tax Credit?
Sources:
1040 Instructions, IRS
Am I Eligible for the Child Tax Credit? IRS
Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent
Publication 972, Child Tax Credit, IRS
Ten Facts About the Child Tax Credit, IRS
Reference:
- Form 8812, Additional Child Tax Credit: www.irs.gov/pub/irs-pdf/f8812.pdf
- Topic 602 – Child and Dependent Care Credit: www.irs.gov/taxtopics/tc602.html
- Who Can I Claim as a Dependent? www.irs.gov/uac/Who-Can-I-Claim-as-a-Dependent%3F
