Child Tax Credit - Additional Child Tax Credit and ARRA

Some taxpayers cannot take full advantage of the child tax credit because their credit amount is more than the taxes they owe. These taxpayers may receive a payment for some or all of the remaining credit amount. This additional child tax credit is refundable, which means taxpayers can receive refunds even when they do not owe any tax.

Your credit amounts are automatically calculated based on the dependent and income information you have entered. To review your child tax credit and additional child tax credit:

  1. From within your TaxAct® return (Online or Desktop) click Federal. On smaller devices, click the menu icon in the upper left-hand corner, then select Federal.
  2. Click Other Credits in the Federal Quick Q&A Topics menu to expand the category and then click Child tax credit
  3. The program will proceed with the interview questions for you to enter or review your credit information

The provisions of the American Recovery and Reinvestment Act (ARRA) changed the way the additional child tax credit is figured. As a result, more families are now eligible for the credit.

The ARRA reduced the minimum earned income amount used to calculate the additional child tax credit to $3,000. Before the ARRA, the minimum earned income amount was set to rise to $12,550. Reducing the amount to $3,000 allowed more taxpayers to use the additional child tax credit, and increased the amount of payments they received.

The Tax Relief Act of 2010 extended these changes through 2011 and 2012. The American Taxpayer Relief Act of 2012 further extended the changes through December 2017. 

The Tax Cuts and Jobs Act (TCJA) of 2017 increased the additional child tax credit to $1,400, increased the income at which the credit begins to phase out, and reduced the refundability threshold. Along with those changes, TCJA mandates that every child must have a Social Security Number in order to qualify. These changes are set to expire at the end of 2025. 

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