The Child Tax Credit, which is a tax benefit provided by the United States federal government, is $2,000 for tax year 2025 (to be filed) in 2026. By claiming the CTC to reduce the amount of tax you owe, potentially down to zero. If your total tax liability is less than the credit amount, you may get a refund upto $1,700 for each child.
To avail the benefits of CTC, one is required to claim it with the tax return. For tax year 2025, the filing is likely to begin by late January 2026, and refund via direct deposit is likely to be received by early March 2026, only if your tax liability will be less the CTC. To check the eligibility, claiming and other details, you are requested to stay tuned.
Eligibility for CTC
To avail the benefits of Child Tax Credit, the certain eligibility criterias must be met by the child as well as taxpayer.
Child:
- The child must be a US resident, additionally he/she must have a Social Security Number.
- The child’s age shouldn’t be above 17 years by the end tax year 2025 i.e. December 31, 2025.
- The child must be your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, grandchild, niece, or nephew.
- The child must have spent more than half a year (six months) with you.
- The child shouldn’t have spent more than half of their own support during the tax year 2025.
Taxpayer:
- You must be a permanent resident of the United
- States and valid SSN to file the taxes as Single, Head of Household, Married Filing Jointly, or Qualifying Widow(er).
- Your Modified Adjusted Gross Income (MAGI) shouldn’t exceed $200,000 and $400,000 if you are filing individually and jointly, respectively.
Note: The tax credit is reduced by $50 for every $1,000 increase in the Modified Adjusted Gross Income (MAGI) for a single taxfiler; and will be reduced by the same amount, if the MAGI exceeds by $2,000 for joint filers.
How to Claim?
To claim the CTC for tax year 2025, one has to file the Form 1040, U.S. Individual Income Tax Return, with Schedule 8812, Credits for Qualifying Children and Other Dependents. The forms to claim the Child Tax Credit are likely to be available around late January 2026, individuals will also claim it using the IRS Free File or IRS Direct Deposit.
The step-by-step instructions to claim the CTC for the tax year 2025 using the Free File or Direct File is available below.
Free File:
- Visit at https://www.irs.gov/file-your-taxes-for-free and click on ‘Use IRS Free File.’
- Click on ‘Explore Free Guided Tax Software,’ if your AGI is $84,000 or less; and if your AGI is above this amount, click on ‘Use Fillable Forms.’
- If you have clicked on the first option, now you need to click an option that reads ‘Browse all trusted partners,’ click on it; if you have choose the second option, you need to tap on the ‘Start Free File Fillable Forms,’
- Now, you have to tap on the FreeTaxUSA, and then on Start your free return; or click on Start Free File Fillable Forms to create an account and file your return for tax year 2025.
Direct File
- Navigate to https://www.irs.gov/file-your-taxes-for-free and click on Use IRS Direct File, which is available in only 25 states of the United States.
- Now, you need to click on ‘Check eligibility now,’ and get redirected to the next webpage.
- Now, you will see the list of 25 eligible states of the US, tap on it and make visible other options; here you will see a button of Next, click on it.
- Post tapping on the above mentioned option, you will be given the instructions, make sure to read it properly and go to the page of ID.me.
- Lastly, you have to sign up and then log in to file a tax return for tax year 2025 by providing required details.
To stay tuned regarding the Child Tax Credit 2025 recent developments, it is highly recommended to keep an eye on the official website of the IRS.