COVID IRS Tax Tip: Grandparents With Eligible Dependents Should Not Miss Out on Child Tax Credit

by | Jan 20, 2023 | Taxes |

Grandparents, foster parents or people caring for siblings or other relatives should check their eligibility to receive the 2021 child tax credit. People who claim at least one child as their dependent may not realize they could be eligible to benefit from the child tax credit. 

Eligible taxpayers who received advance child tax credit payments last year should file a 2021 tax return to receive the second half of the credit. Eligible taxpayers who did not receive advance child tax credit payments last year can claim the full credit by filing a 2021 tax return. 

People should review the eligibility rules to make sure they still qualify for the credit. The Interactive Tax Assistant can help people who aren’t sure. Taxpayers who haven’t qualified in the past should also check because they may now be able to claim the credit. The only way to receive the credit is to file a 2021 federal tax return. 

What is the child tax credit expansion?
The child tax credit expansion increased the amount of money families can receive per child and expanded who can receive the payments. The credit increased from $2,000 to $3,600 per child for children under the age of six, from $2,000 to $3,000 for children over the age of 6 and raised the age limit from 16 to 17 years old. 

The child tax credit expansion applies to tax year 2021 only.

Who qualifies for the child tax credit?
Taxpayers can claim the credit for each qualifying child who has a Social Security number that is valid for employment in the United States and issued by the Social Security Administration before the due date of their tax return. This includes the filing extension if the taxpayer requested the extension by the tax return’s original due date. 

To be a qualifying child for the 2021 tax year, the child must fit certain criteria.

What are the eligibility factors?
Individuals qualify for the full amount of the 2021 child tax credit for each qualifying child if they meet all eligibility factors and their annual income is not more than:

  • $150,000 if they’re married and filing a joint return, or if they’re filing as a qualifying widow or widower.
  • $112,500 if they’re filing as a head of household.
  • $75,000 if they’re a single filer or are married and filing a separate return. 

Parents and guardians with higher incomes may be eligible to claim a partial credit.

If you need assistance in filing a petition for guardianship of your grandchild, contact the Law Offices of Renee Lazar at 978-844-4095 for a FREE one hour no obligation consultation.

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