Child Tax Credit is one of deductions and reliefs the IRS offers. It can save you as much as $2,000 per child if you meet all the requirements. We have gathered all the necessary information, which you need to know about Child Tax Credit in this infographic.
Paying for childcare and dependent care can be quite expensive. Thus there is a tax credit to help reduce the costs. You can claim it in cases if you had to pay for someone to take care of your child, dependent or spouse so that you could work or go to school. Children must be 12 or younger at the end of the tax year, or dependent adult family members or spouses who were not able to care for themselves due to mental or physical illness. The largest possible credit is $1,050 with one dependent and $2,100 with multiple. The CDCTC is non-refundable.
Summary of Child Tax Credit for US citizens living abroad
As we all know the costs of childcare can be significant. However, if you know US tax laws, you can take advantage of available credits for dependents, including children and others. It helps to directly reduce the amount you owe to the IRS. If you as a US expat parent have a tax bill of $4000 USD and you are eligible for $1000 USD tax credit, then your bill will be reduced to $3000 USD. Another example, if you qualify for the Child Tax Credit and you owe below 0, then the IRS will send you the remaining amount of the credit, up to $1400 USD.
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