Child tax credit: Who is eligible?
One of the key benefits that US ex-pats can take advantage of from the convenience of their home is the Child Tax Credit or CTC. Every US citizen and foreign resident is entitled to this fundamental right. The easiest way to utilize the Child Tax Credit efficiently is to get advice from a personal tax consultancy service in Toronto.
What is Child Tax Credit and who is eligible?
Regarding the Child Tax Credit or CTC, there have recently been certain modifications that you need to be aware of. According to the revised policies, parents are now eligible to request CTC advance payments for the corresponding year. For each child under the age of six, parents can, for example, claim up to $300 per month. For each child between the ages of six and seventeen, the monthly payment is settled as $250 per child.
Therefore, if you have already requested and obtained the advance payments as described above, you might not be able to claim the full amount of the Child Tax Credit on your IRS returns. Please get in touch with US tax consultants in Toronto if you need any further clarification on this subject.
Let’s now look at how to utilize the Child Tax Credit while residing abroad.
This is typically available to American ex-pats living abroad, and theoretically, the most recent changes still permit this. To collect the Child Tax Credit, you must, however, meet some requirements for eligibility.
Firstly, as was said above, every ex-pat is eligible to apply for the standard Child Tax Credit for their entitled children. To be eligible for the benefits that the American Rescue Plan adds to the 2021 Child Tax Credit, you must have lived in the United States for at least half of the year for which you are claiming.
This implies that you won’t be eligible for the increased credit amounts or advance monthly payments unless your main residence (house address) was in the US for at least six months in 2021.
If your offspring have migrated abroad, the rule stays the same i.e. they must have stayed in the US for at least six months of the accountable year
To receive the Child Tax Credit, get in touch with the Toronto tax consultation service
The new Child Tax Credit policy allows expatriates to claim up to a $2000 credit per child on their annual tax return. Please contact the ex-pat tax consultants in Toronto for further information on this.
