The 7 Step Checklist
If you are a parent, guardian, or someone who can claim a child as a dependent on your income tax return, you may be eligible to claim the child tax credit. This is a refundable federal tax credit which may be worth as much as $1,000 per child.
Some tax benefits are created for families with children to help ease the financial costs, and this is one that is often missed. Don’t confuse this with the Child and Dependent Care tax deduction. They are very different.
You can claim the child tax credit by using TurboTax Online. Tax software helps busy families by finding tax deductions and credits in a quick and easy way. There are many facets to this valuable tax credit and checking eligibility for a qualifying child is just one step of many.
You must be able to say yes to all 7 questions.
Here is a checklist to determine if your child or dependent can be claimed for the credit;
1) Relationship Test – The dependent child is a son, daughter, stepchild, foster child, adopted child, brother or sister; or a descendant of any of these relations such as a grandchild, nephew, or niece
2) Residency Test – The dependent child lived with the taxpayer for more than half the year (there are exceptions to this rule)
3) Age Test – The dependent the child is 16 years old or younger, not 17 or older
4) Support Test – The dependent child did not provide more than half of his or her own financial support
5) Citizenship Test – The dependent child is a citizen or resident alien of the United States
6) Dependency Test – The dependent child meets the criteria to be claimed as a dependent of the taxpayer
7) Income Tax Return Test – The dependent child does not file a joint tax return or (files only to claim a tax refund)
You will save yourself a lot of trouble by referring to the child tax credit checklist before you try to claim a child as a qualifying child who is not. There are strict tax laws in place, and the IRS will be going over your income tax form with a fine tooth comb to ensure you are entitled to the tax refund.
The Child Tax Credit Worksheet IRS Publication 972