The Child Tax Credit (CTC) for 2024 is expected to undergo changes based on the Tax Relief for American Families and Workers Act of 2024, approved by the House Ways and Means Committee on January 19, 2024. The proposed modifications include adjustments to the credit calculation, extension of certain tax benefits, and relief measures. This article provides insights into the potential start date for the Child Tax Credit in 2024, eligibility criteria, and the proposed changes to the credit amount.
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Legislative Approval and Proposed Changes
The Tax Relief for American Families and Workers Act of 2024, with a notable 40-3 vote from the House Ways and Means Committee, includes provisions to enhance the Child Tax Credit. The proposed changes involve a per-child basis calculation, multiplying earned income exceeding $2,500 by 15 percent and multiplying the result by the total number of children.
To be eligible for the Child Tax Credit, taxpayers and their children must meet specific eligibility requirements, including their age and relationship to the person claiming them. Income limits influence the phase-out for higher-income people. The claiming process for the tax year 2023 is submitting the federal tax return (Form 1040 or 1040-SR) by April 15, 2024, or October 2024, with a tax extension. Additionally, Schedule 8812 is necessary to calculate the CTC amount and probable partial refund.
The current Child Tax Credit is $2,000 per child, with a refundable portion of up to $1,600. The proposed changes aim to adjust the calculation method, with modifications applying to the 2023, 2024, and 2025 tax years. The maximum refundable credit amount is expected to increase to $1,800 for 2023, $1,900 for 2024, and $2,000 for 2025. The overall Child Tax Credit maximum will also be subject to inflation adjustments in 2024 and 2025.
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Eligibility Criteria and Relationship to Proposed Changes
Eligibility criteria for the CTC include the child’s age and the relationship to the taxpayer. The proposed changes emphasize a per-child basis calculation linked to earned income, with adjustments in the maximum refundable credit amount. Taxpayers must stay informed about these changes to ensure accurate filing and potential benefits.
While the article doesn’t specify an exact start date for the Child Tax Credit in 2024, the legislative progress indicates a commitment to implementing changes for the selected tax years. Taxpayers should monitor official announcements and updates regarding enacting the proposed modifications.
