Child Tax Credit
A tax credit worth up to $2,000 per qualifying child under age 17. Up to $1,700 is refundable in 2025, meaning you can receive it even if you owe no tax.
The Child Tax Credit (CTC) provides up to $2,000 per qualifying child under age 17 at the end of the tax year. The child must be your dependent, a US citizen or resident, and have a valid Social Security number. The credit directly reduces your tax liability dollar for dollar, making it one of the most valuable family tax benefits.
For 2025, up to $1,700 of the credit is refundable as the Additional Child Tax Credit (ACTC), meaning families with little or no tax liability can still receive a refund. The refundable portion is calculated as 15% of earned income above $2,500.
The credit begins to phase out at $200,000 of modified AGI ($400,000 for married filing jointly), decreasing by $50 for every $1,000 of income above the threshold. There is also a $500 non-refundable credit for other dependents (such as children 17 and older or aging parents) who do not qualify for the full CTC.
Related Terms
Adjusted Gross Income (AGI)
Your gross income minus specific adjustments such as student loan interest, IRA contributions, and self-employment tax. AGI is the starting point for calculating your taxable income.
Tax Liability
The total amount of tax you owe for the year before accounting for payments, withholding, and refundable credits. It is the bottom-line tax calculated on your return.
Filing Status
Your tax classification based on marital and family situation — Single, Married Filing Jointly, Married Filing Separately, Head of Household, or Qualifying Surviving Spouse.
Earned Income Credit (EITC)
A refundable tax credit for low- to moderate-income workers. The amount depends on income, filing status, and number of qualifying children — worth up to $7,830 in 2025 with three or more children.
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