Your child isn’t officially an adult until they reach age 18, but with the passing of the Tax Cuts and Jobs Act, signed by President Trump on Dec. 22, 2017, most tax breaks disappear after the age of 17. Among them is the Child Tax Credit. Age 17 is the cutoff date for qualifying.
Children aged 17 and over are not eligible for the Child Tax Credit.
Child Tax Credit Age 17
Children that qualify for the Child Tax Credit are under age 17 on Dec. 31, must have lived with you for more than six months and did not pay for more than 50 percent of half of their own support. Biological or adopted children are not the only ones to qualify. If they meet the living and support qualifications, you can claim the Child Tax Credit with stepchildren or foster children, and even siblings, stepsiblings or grandchildren. However, only U.S. citizens, U.S. nationals or resident aliens are considered qualifying children. The TCJA is set to expire on Dec. 31, 2025.
No More Personal Exemptions
One of the biggest changes in the TCJA involves the end of the personal exemption. Formerly, claiming a 19-year-old as a dependent on taxes was possible as a personal exemption, which for 2017 was $4,050. Now, there are no more personal exemptions, but the standard deduction has been raised to $24,000 for a married couple filing jointly, so far fewer people will itemize their taxes. The 2017 standard deduction for a married couple filing jointly was $12,700.
The Child Tax Credit 2018
The Child Tax Credit doubled under the TCJA, from $1,000 to $2,000 per child. This year’s income limitations for the Child Tax Credit are higher than in previous years before a Child Tax Credit phase out occurs. Single parents may claim the entire tax credit if earning up to $200,000, and are eligible for a partial credit if earning up to $240,000. For married couples filing jointly, the full credit is available for those earning up to $400,000, with a partial credit available for those whose income is less than $440,000. Another benefit: This is not a tax deduction, but a tax credit, meaning the money comes directly off the tax bill. That can save you money in other ways. For example, if you have two children under age 17 and owe the IRS $4,000, once you include the credit for both of them you will not owe any tax. The Additional Child Tax Credit for 2018 is refundable up to $1,400.
The Child Tax Credit 2017
For 2017, the Child Tax Credit is worth up to $1,000 per child. The Child Tax Credit phase out begins at an adjusted gross income of $75,000 for single taxpayers and $110,000 for those married and filing jointly. Claim the Child Tax Credit on either Form 1040, Form 1040-A, or Form 1040-NR. The IRS does not permit you to claim the Child Tax Credit if you use Form 1040-EZ or Form 1040NR-EZ.
If your Child Tax Credit exceeds the amount of income taxes you owe, you may prove eligible for the Additional Child Tax Credit if you have at least three qualifying children. You must have earned income of at least $3,000 for eligibility. The Child Tax Credit itself is nonrefundable if it reduces the tax bill below zero, but that’s not the case with the Additional Child Tax Credit. The amount you didn’t use, any amount in excess of $3,000, is refundable. The tax credit is figured by taking 15 percent of a taxpayer's taxable earned income above $3,000 up to the maximum credit amount of $1,000 per child. Those in income brackets above 15 percent are ineligible for the Additional Child Tax Credit.
- IRS.gov: Publication 972 — Child Tax Credit
- Saving2Invest: 2017 vs 2018 Child Tax Credit Qualification and Income Thresholds with Trump GOP Tax Reform Updates
- NOLO: Child Tax Credit
- Institute on Taxation and Economic Policy: Parents of College Students: The Tax Plans’ Losers that No One Is Talking About
- IRS: In 2017, Some Tax Benefits Increase Slightly Due to Inflation Adjustments, Others Are Unchanged
- What’s new with the child tax credit after tax reform | Internal Revenue Service
A graduate of New York University, Jane Meggitt's work has appeared in dozens of publications, including PocketSense, Financial Advisor, Sapling, nj.com and The Nest.