The 2022 child tax credit calculator is created for fast estimating the CTC , you can avail in the tax year 2022 when the CTC rules are not same as the tax year 2021 when the enhanced child tax credits were allowed due to passing of American Rescue Plan (ARP) . Now for the tax year 2022, the quantum of tax credit , nature of tax credit and the rules of eligibility reverted to rules applicable in year 2020 . So this post is exclusively on child tax credit rules applicable when you file tax return for year 2022 (due date 18th April 2023)
Rules for 2022 child tax credit calculator
Under the US tax laws, taxpayers having children are allowed a tax credit that can offset any tax liability for the year 2022. Following is the features of child tax credit in allowed in the year 2022
- Only allowed to taxpayer having eligible children .
- The maximum child tax credit is $2,000 per child.
- There is phaseout of child tax credit if the income of taxpayer filing Single status return exceeds $2,00,000 in a year . For married filing Jointly, the threshold for phaseout is $400,000. The rate of the phaseout is $50 per $1000 increase .
- The tax credit is not refundable . It means the CTC will be used for adjusting with the tax liability. But if there is no tax liability , the extra unused child tax credit shall not be refundable.
Test the 2022 Child Tax Credit Calculator
What is eligibility rule for claiming child tax credit in 2022?
Please do not confuse with child tax credit rule for year 2021. when certain rules were relaxed by ARP . For the year 2022 (Filing April 2023 ) , the eligibility rules are as under :
- You must not claim child tax credit for a child who is not a U.S. citizen, U.S. national, or U.S. resident alien. So, child must have a Social Security Number (SSN) issued by the Social Security Administration.SSN number for each child for whom you claim CTC , must be filled in the tax return.
- There must be any one of the relationships mentioned below between you and the child
- son, daughter, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew.
- The age of child should not be more than 17 years at the end of 2022.
- The child must live with you of at least half of the Calendar year 2022 (jan to December 2022) and should not provide 50% of the expense on the his or her own support for 2022.
- You must claim the child as dependent in your tax return.
- The child does not file a joint return for the year (or files it only to claim a refund of withheld income tax or estimated tax paid).
Child tax credit vs child & dependent care credit.
Is child tax credit available even if one claims child and dependent care expense?The short answer is Yes. As a rule, an Individual needs to put the child as dependent in his tax return .But , he can also claim child and dependent care credit if he has paid a person or an organisation to care for a qualifying child and satisfies other conditions like having minimum earned income etc..For the year 2022 , a person claiming child tax credit can also claim additionally $3,000 per child of tax credit under the child & Dependent Care .Please also note that like the child tax credit, the credit for child & dependent care is also non-refundable.
How to claim child tax credit in 2022?
Now , a tax payer will have to use the Schedule 8812 to form 1040 to compute the tax credit allowable for the tax year 2022. Please note that IRS made the Publication 972, Child Tax Credit obsolete from year 2021 and introduced the new form 8812 for the computation of child tax credit.
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