What Is the Child Tax Credit?
The Child Tax Credit (CTC) is a federal income tax credit available to US taxpayers who have dependent children under the age of 17. For the 2025 tax year, the credit is worth up to $2,200 per qualifying child — an increase from the previous $2,000 limit, reflecting changes introduced by the One Big Beautiful Bill (see below).
Unlike a tax deduction, which reduces the amount of income subject to tax, a tax credit reduces your actual tax bill dollar-for-dollar. If you owe $4,000 in federal income tax and you have two qualifying children, the CTC can reduce that bill to zero — and part of the credit may be paid to you as a refund.
Quick-Reference Table: CTC for the 2025 Tax Year
| Component | Amount per Child |
|---|---|
| Total Child Tax Credit | $2,200 |
| Non-refundable portion | $500 |
| Refundable portion (ACTC) | up to $1,700 |
| Child age limit | Under 17 at December 31 |
| Income phase-out (single filers) | Begins at $200,000 AGI |
| Income phase-out (married filing jointly) | Begins at $400,000 AGI |
Who Qualifies for the Child Tax Credit?
To claim the CTC, both the child and the taxpayer must meet specific criteria.
The child must:
- Be under 17 years old at the end of the tax year (December 31, 2025)
- Be your son, daughter, stepchild, foster child, sibling, or a descendant of any of these
- Have lived with you for more than half the tax year
- Not have provided more than half of their own financial support
- Be claimed as your dependent on your tax return
- Be a US citizen, US national, or US resident alien
- Have a valid Social Security Number (SSN) issued before the due date of your return
The parent or guardian must:
- Have earned income during the year (required for the refundable ACTC portion)
- File a federal tax return
- Not exceed the income phase-out thresholds
Income Limits and Phase-Out
The Child Tax Credit begins to phase out once your adjusted gross income (AGI) exceeds:
- $200,000 for single filers, heads of household, and married filing separately
- $400,000 for married couples filing jointly
Above these thresholds, the credit reduces by $50 for every $1,000 of income over the limit. For example, a married couple with two children and an AGI of $420,000 would see their credit reduced by $1,000 (20 x $50), leaving a credit of $3,400 instead of $4,400.
There is no income floor — even low-income families can benefit through the refundable Additional Child Tax Credit.
The Refundable Portion: Additional Child Tax Credit (ACTC)
The Additional Child Tax Credit (ACTC) is the refundable part of the CTC. For 2025, up to $1,700 per child is refundable, meaning you can receive it as a cash refund even if your federal income tax liability is zero.
To qualify for the ACTC, you generally need earned income of at least $2,500. The refundable amount is calculated as 15% of your earned income above $2,500, up to the $1,700 per-child cap.
The ACTC is claimed on Schedule 8812 (Credits for Qualifying Children and Other Dependents), which is filed alongside your Form 1040.
How to Claim the Child Tax Credit
- File Form 1040 (the standard US individual income tax return)
- List each qualifying child as a dependent, including their name, SSN, and relationship
- Complete Schedule 8812 to calculate your CTC and any refundable ACTC amount
- The credit will automatically reduce your tax liability; any refundable amount is added to your refund
If you use tax software, the software will walk you through Schedule 8812 automatically once you enter your dependents.
The One Big Beautiful Bill: CTC Increased to $2,200
Prior to the One Big Beautiful Bill, the Child Tax Credit was $2,000 per qualifying child — a level that had been in place since the Tax Cuts and Jobs Act of 2017. The One Big Beautiful Bill raised this to $2,200 per child for the 2025 tax year, with the refundable ACTC cap increasing to $1,700.
This change was intended to partially offset the cost-of-living pressures on American families, particularly for households with multiple children.
Related Resources
- Child Tax Credit 2026: Rates, Changes and Calculator
- Child Tax Credit vs Additional Child Tax Credit: What Is the Difference?
- Child Benefits Calculator
Source: IRS.gov, Schedule 8812, Publication 972. Rates reflect the 2025 tax year. Tax law can change; verify current figures at IRS.gov before filing.