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Child Tax Credit: what is the income limit for joint filers, single filers and heads of household?

Under the Child Tax Credit scheme, parents under the specified income threshold will receive $3,600 for each child under six years old and $3,000 for each child under 17 years of age.

Child Tax Credit: what is the income limit for joint filers, single filers and heads of household?
Timothy A. Clark AFP

On 15 July, the IRS began issuing payments to millions of American families as part of the new enhanced Child Tax Credit scheme. These payments are an advance on the 2021 Child Tax Credit that was increased as part of President Joe Biden’s $1.9 trillion American Rescue Plan passed in March by Democrats, which aims to give more financial help to US families struggling amid the coronavirus pandemic.

Parents under the specified income threshold will receive $3,600 for each child under six years old and $3,000 for each child under 17 years of age. Up to 2020, parents could only claim up to $2,000 for each dependent age 16 and younger, so this enhanced tax credit will be a significant boost. The payments will be made in 12 monthly installments of $360 for children under six and $250 for children under 17.

Parents will also receive a credit of $500 for children aged 18 years old, or for college-attending children aged between 18 and 24.

As things stand, the credit has only been expanded for the 2021 fiscal year and the IRS was given four months to get the payments up and running. As a result, families will only get half of the credit split over six installments this year. The other half can be claimed on 2021 tax returns next year.

Over 90% of US households are set to receive payments under the 2021 Child Tax Credit scheme, although payments will be phased out for families earning above the specified income thresholds.

Income thresholds for Child Tax Credit

Single filers

Single taxpayer parents with an adjusted gross income (AGI) under $75,000 will qualify for the full child tax credit amount of $3,600 for children under six and $3,000 for children under 17. Payments will be phased out for those earning above $75,000, up to a threshold of $240,000. Single filers earning more than $240,000 will not be eligible to receive the child tax credit.

Head of households

Head of households with an adjusted gross income of less than $112,500 will be eligible for the full child tax credit amount of $3,600 for children under six and $3,000 for children under 17. At $112,500, payments begin phasing out, up to a limit of $240,000. Heads of households earning more than $240,000 will not be eligible to receive the child tax credit.

Married/Joint filers

Joint filers/married couples with a combined adjusted gross income of less than $150,000 will be entitled to claim the full child tax credit amount of $3,600 for children under six and $3,000 for children under 17. Payments will be phased out for couples earning above a combined $150,000, up to a threshold of $440,000. Couples with a combined income above $440,000 will not be eligible to receive the child tax credit.

Payments for non-filers

Child tax credit payments will be automatically sent to parents who filed their 2020 tax returns or claimed all their dependents on their 2019 tax return. If you don't normally file taxes, because your income is too low or you don't have a bank account or a permanent address, you are still entitled to the payment however you will not be sent it automatically. For nonfilers, the IRS has opened a new online portal so they can register their information, which is available in both English and Spanish.