The Additional Child Tax Credit (ACTC) is offering much-needed financial relief for families in 2025. With up to $1,700 available per qualifying child, this refund can make a significant impact on household budgets. Here’s everything you need to know to check if you’re eligible and how to claim your refund.
Who Qualifies for the ACTC?
To qualify for this refund, both parents and children must meet certain conditions. Here are the main requirements:
- The child must be under 17 at the end of 2024.
- The child must be related to you, this includes children, stepchildren, siblings, or grandchildren and must have lived with you for over half the year.
- The child must have a valid Social Security number and be a U.S. citizen or resident.
Parents also need to meet income requirements:
- Your income must exceed $2,500 to qualify for the refundable credit.
- The full $1,700 is available for households earning up to $200,000 (or $400,000 for joint filers). After that, the credit reduces by $50 for every $1,000 of additional income.
How Is the Refund Calculated?
The ACTC is a portion of the Child Tax Credit that’s refundable. This means even if you don’t owe taxes, you could still get money back.
For example:
- If you earned $25,000 in 2024, your refund calculation would look like this:
($25,000 – $2,500) × 15% = $3,375
Since the ACTC has a $1,700 cap per child, that’s the most you’d receive for each qualifying child.
Filing for the Refund
When tax season arrives, here’s how to claim the ACTC:
- File Form 1040 or 1040-SR for your 2024 taxes.
- Attach Schedule 8812, which calculates the Child Tax Credit and ACTC.
- Ensure that every qualifying child has a valid Social Security number issued before the filing deadline.
When to Expect Your Refund
The IRS processes ACTC refunds starting mid-February. For early filers, this means:
- Direct deposits by February 27, 2025.
- Paper checks will follow in early March.
Why This Matters
With rising costs and financial pressures, the ACTC could provide a welcome boost for families. Don’t miss out review your eligibility, prepare your documents, and file on time to maximize your benefits.
Keep an eye on your tax filings, and ensure you claim every dollar you’re entitled to. This $1,700 could make a big difference in your family’s financial well-being in 2025.
