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Grandparents with eligible dependents? Don’t miss out on the 2021 child tax credit

Posted on November 16, 2022

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

That’s because 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. It’s often overlooked, but eligible taxpayers who did not receive advance child tax credit payments last year can claim the full credit by filing a 2021 tax return.

The CPAs at Teipen CPA Group can help you review the eligibility rules to make sure you still qualify for the credit. Or you can check out the IRA Interactive Tax Assistant link. It can also help people who aren’t sure. The only way to receive the credit is to file a 2021 federal tax return. 

What to know:

  • 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?

  • You can claim the credit for each qualifying child with 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.

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.

For more information call Teipen CPA Group or go to IRS.gov:
2021 Child Tax Credit and Advance Child Tax Credit Payments Frequently Asked Questions