- Days left
bundled baby tax creditTaxpayers can receive a credit toward their taxes for each qualifying child. Tax credits are very advantageous to taxpayers because they represent a direct reduction in the tax dollars to be paid. For 2007, the maximum credit per child is $1,000. A credit is only given for a qualifying child, and in order to qualify, the child must:
  • Be under age 17 at the end of 2007
  • Be your son, daughter, stepchild, foster child, brother, stepbrother, sister, stepsister, or the child of anyone on this list
  • Receive over half of their support from you
  • Live with you for more than half of 2007
  • Be a U.S. citizen, a U.S. national, or a U.S. resident alien.
All of the above requirements must be fulfilled in order for you to potentially claim the child tax credit on your taxes. The full amount of the credit is $1,000 per child, but it is reduced for married couples with adjusted gross income over $110,000 or single people with adjusted gross income over $55,000. The amount of the reduction in the credit depends upon your income.

There are special rules if a child qualifies for more than one person, as in the case of a divorce. There are also special rules for children who don't live with you because of special circumstances such as medical care or living in a juvenile detention facility. See IRS Publication 972 for more details on the Child Tax Credit and for instructions on filing.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Increase your money and finance knowledge from home

Getting out of debt

Everyone hates debt. Get out of it.

View Course »

How to Avoid Financial Scams

Avoid getting duped by financial scams.

View Course »

TurboTax Articles

What is Schedule F: Profit or Loss from Farming

If you earn a living as a self-employed farmer, you may need to include a Schedule F attachment with your tax return to report your profit or loss for the year. The Internal Revenue Service defines ?farmer? in a very broad sense?whether you grow crops, raise livestock, breed fish or operate a ranch.

5 Tax Tips for Single Parents

Filing taxes as a single parent requires coordination between you and your ex-spouse or partner. Usually the custodial parent claims the child as a dependent, but there are exceptions. A single parent is allowed to claim applicable deductions and exemptions for each qualifying child. Even though you claim your child as a dependent, she may still have to file her own tax return if she has income, such as from an after-school job.

Add a Comment

*0 / 3000 Character Maximum