What Was Publication 972: Child Tax Credit?
It was utilized for information about the child tax credit from tax years 2020 and prior. For tax years 2021 and later, you will never again utilize Publication 972 to figure your child tax endlessly credit for different dependents. Rather use Schedule 8812 related to Form 1040.
The document remembered an update for any changes in the tax credit for the year, a worksheet to assist taxpayers with computing their child credits in certain unusual cases, as well as guidelines for deciding the child tax credit to claim.
Understanding Publication 972: Child Tax Credit
Most parents, foster parents, and watchmen of children under age 17 can utilize the child tax credit to lower their taxable income for the year. This benefit can be claimed utilizing Form 1040 or 1040NR.
IRS Publication 972, downloadable here, was utilized in tax years 2020 and prior to decide whether a child was eligible. As per the document, a qualifying child or dependent must have been:
- younger than 17 toward the finish of the tax year;
- claimed as a dependent on the taxpayer's federal tax return;
- a U.S. citizen, resident alien, or public — more information on residency requirements can be found in IRS [Publication 519](/irs-bar 519);
- lived with the taxpayer for the greater part of the tax year; and
- Not have given the greater part of their own financial support.
Publication 972 likewise revealed how much credit a taxpayer can receive. In the 2020 tax year, the maximum amount that could be requested for a qualifying child was $2,000. That limit has been in effect starting around 2018, when the IRS multiplied the $1,000 credit accessible on 2017 tax returns.
IRS Publication 972 gave a worksheet that can be utilized to decide the amount of child tax credit that can be claimed.
Publication 972 gave guidance on possibly getting a portion of any unused credit refunded, too. Following changes to the law in 2017, the refundable portion of the child tax credit, known as the [additional child tax credit](/extra child-tax-credit) (ACTC), increased to $1,400 from $1,000. This implied low-income taxpayers whose credits surpass their tax liabilities could get refunded up to $1,400.
The IRS allows families with an annual income of more than $2,500 to request a refund utilizing the ACTC. To make a claim for a refund, filers must complete Schedule 8812.
The child tax credit has limits and isn't accessible to taxpayers at certain major league salary levels.
In 2020, the tax credit was decreased for single parents with a adjusted gross income (AGI) of $200,000. In the mean time, for married couples filing jointly, qualification was diminished at $400,000 and wiped out at $440,000.
- There are upper-income limits on qualification for the credit.
- Publication 972 was utilized to work out one of America's most well known tax credits, the Child Tax Credit.
- The form is at this point not being used from tax years 2021 and forward.