The Child Tax Credit (CTC) is claimed on your federal tax return for each qualifying child under 17 with a valid Social Security number. Part of the credit is refundable as the Additional Child Tax Credit for families with earned income above a small threshold. The credit amount was increased by federal law in 2025. Claim it by filing a return - free help is available at VITA sites.
How it works
The short version, before the detail.
The Child Tax Credit reduces the tax you owe for each qualifying child. If the credit exceeds your tax, part of it can be refunded through the Additional Child Tax Credit, which depends on earned income above a threshold. Families with no earnings generally cannot receive the refundable portion.
Federal law enacted in 2025 increased the maximum credit per child and indexed it for inflation. The temporary fully refundable, monthly-advance version of 2021 has long ended; today the credit is claimed annually on your tax return.
Qualifying children must be under 17 at the end of the tax year, be your son, daughter, stepchild, foster child, sibling or a descendant of one, live with you more than half the year, and have a Social Security number valid for work. A separate smaller credit for other dependents applies to older children and other relatives.
Higher-income families see the credit phase out. Most low and moderate income families receive the full credit if they have enough tax liability or earnings.
Some states have their own child tax credits, often refundable and aimed at lower-income families.
Two families with the same number of children can receive very different amounts because of how the refundable part works. The non-refundable Child Tax Credit reduces the tax you owe. If your tax bill is smaller than the credit, the Additional Child Tax Credit can refund some of the difference - but only based on earnings above a threshold. A family with low but steady earnings can therefore receive a substantial refund, while a family with no earnings receives none of the refundable portion.
Who claims the child matters. Only one taxpayer can claim a child for the credit each year, generally the parent the child lived with for more than half the year. Separated parents sometimes agree that the other parent will claim the child, using IRS Form 8332. If two people claim the same child, the IRS applies tie-breaker rules and the refund of one may be delayed.
Families should also check the Child and Dependent Care Credit for child care costs, the EITC, and any state child tax credit. Several states now offer refundable credits that, unlike the federal one, reach families with very low or no earnings.
Who usually qualifies
Factors the agency looks at. Only they make the final decision.
Amounts change with law and inflation; check IRS guidance each year.
How to apply, step by step
Confirm each child qualifies
Age, relationship, residency, SSN.
Gather income documents
W-2s, 1099s.
File a federal return
Claim CTC and ACTC.
Use free filing
VITA or IRS free options.
Claim state credits
If available.
Use direct deposit
Faster refunds.
What to have ready
Missing one item is rarely a reason to wait - start now.
- Children's Social Security cards
- Proof children lived with you
- Income documents
- Child care expenses (for related credits)
What happens after you apply
How it compares
Similar programmes, and which one fits which need.
| Programme | What it covers | Best for |
|---|---|---|
| Child Tax Credit | Per-child tax credit, partly refundable | Families with children under 17 |
| EITC | Refundable tax credit for workers | Low to moderate income workers |
| Child and Dependent Care Credit | Credit for child care costs | Working parents paying for care |
| State child credits | Additional state credit | Residents of participating states |
Real situations
How this plays out for people in common circumstances.
Two kids, modest wages
A couple with two children earns modest wages.
They claim CTC and EITC through VITA.
Grandparent raising grandchild
A grandmother has her grandson living with her all year.
He is a qualifying child for her.
Child turned 17
A family's eldest turns 17.
They claim the smaller credit for other dependents.
No earnings
A parent had no earned income.
The refundable portion requires earnings; check other benefits.
Separated parents both want to claim
A child lives with her mother most nights, but her father also wants to claim the Child Tax Credit.
Under the rules, the mother is the custodial parent. She agrees to sign Form 8332 in alternate years so the father can claim the credit, avoiding rejected returns and delays.
What people miss
True, rarely explained, and it changes the outcome.
State child credits exist
Check.
Grandparents can claim
If rules met.
Credit for other dependents
For older children.
Free filing
Keeps the full amount.
Amounts changed in 2025
Check current figures.
Common reasons people get stuck
Missing SSNs
Required.
Both parents claiming
Causes delays.
Not filing
Loses the credit.
Paying high fees
Use VITA.
Confusing with 2021 advance payments
Those ended.
How it differs by state
Several states offer refundable child tax credits with their own rules.
Key terms explained
The words on forms and letters, in plain English.
- Child Tax Credit (CTC)
- A federal tax credit for each qualifying child under 17.
- Additional Child Tax Credit (ACTC)
- The refundable portion of the Child Tax Credit, available to families with earned income above a threshold.
- Refundable credit
- A credit that can be paid to you as a refund even if you owe no tax.
- Qualifying child
- A child who meets the age, relationship, residency, support and Social Security number tests.
- Credit for other dependents
- A smaller, non-refundable credit for dependents who do not qualify for the CTC, such as children aged 17 or 18.
- Form 8332
- An IRS form a custodial parent uses to release the claim to a child's exemption-related credits to the other parent.
Questions people ask
How much is the Child Tax Credit?
Is the Child Tax Credit refundable?
Who is a qualifying child?
How do I claim the Child Tax Credit?
Can I get the Child Tax Credit with no income?
Are there monthly Child Tax Credit payments?
Can grandparents claim the Child Tax Credit?
Does my state have a child tax credit?
Who gets the Child Tax Credit if parents are divorced?
Can I claim the Child Tax Credit for a newborn?
Does the child need a Social Security number for the Child Tax Credit?
Can I get the Child Tax Credit if I do not owe any tax?
Does the Child Tax Credit affect Medicaid or other benefits?
How do I claim a grandchild for the Child Tax Credit?
What if someone else already claimed my child?
Is the Child Tax Credit the same as the child care credit?
Numbers to call
Free lines. We are not affiliated with any of them.
Official sources
Current figures and applications live here.