Grandparents With Eligible Dependents Could Qualify For 2021 Child Tax Credit

Many taxpayers think that parents are the only ones who can claim child-related tax benefits, like the Child Tax Credit (CTC) when filing a yearly tax return. The reality, however, is that any taxpayers who claim a dependent on their returns could be entitled to CTC benefits. This includes eligible taxpayers who received the advance Child Tax Credit payments last year and who can also file to receive the second half of the credit, while qualifying taxpayers who didn’t receive advance Child Tax Credit payments last year can still claim the full credit when they file their 2021 returns.

Eligible Taxpayers

Families that claim dependents when they file their returns could be eligible for the Child Tax Credit (CTC). This includes not only parents, but also:

• Grandparents;
• Foster parents; and
• Individuals who care for siblings or other relatives.

The dependent who is being claimed will need to satisfy certain requirements. They must, for instance:

• Be under the age of 18 years old at the end of the year;
• Be the taxpayer’s child, stepchild, foster child, sibling, step sibling, half sibling, or a descendant of one of these individuals;
• Have lived with the taxpayer for at least half the year;
• Provide no more than half of their own financial support; and
• Be a U.S. citizen, U.S. national, or U.S. resident alien.

However, to qualify for the credit, taxpayers themselves must still satisfy the other eligibility factors. For example, to be eligible for the Child Tax Credit, a taxpayer cannot have an income of more than:

• $150,000 if married and filing a joint return, or if filing as a widow or widower;
• $112,500 if filing as the head of a household; or
• $75,000 if single or if married and filing a separate return.

Guardians with higher incomes could still be eligible for a partial credit, so even if you think your income may be too high to qualify for the CTC, you should still think about reaching out to an attorney who can help determine whether you could be eligible for a partial credit.

The Child Tax Credit Expansion

The Child Tax Credit expansion increased the amount of money that families can receive per child. The amount of the credit was increased, for instance, from:

• $2,000 to $3,600 per child for children who are under the age of six years old;
• $2,000 to $3,000 for children who are over the age of six years old.

In addition to these changes, the age limit for a qualifying child was raised from 16 to 17 years old. It’s important to note that the CTC has only been extended for tax year 2021.

Call Today for Help Claiming the Child Tax Credit for 2021

The recent changes made to the Child Tax Credit can make it difficult for taxpayers to know whether or not they qualify for benefits. To learn more about the eligibility requirements and the filing process, please call CPA, former FBI Special Agent, and experienced tax return preparation lawyer Ronald Cutler, P.A. at 386-490-9949.

Sources:

irs.gov/newsroom/grandparents-and-other-relatives-with-eligible-dependents-can-qualify-for-2021-child-tax-credit

irs.gov/credits-deductions/individuals/child-tax-credit