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Home » Taxes

2013 Child Tax Credit of $1,000 Extended

Last updated by on 9 Comments

The Child Tax Credit Extended into 2013 & Beyond

The full $1,000 Child Tax Credit has now been extended through 2013 and beyond due to the fiscal cliff deal, signed in to law on Jan 3, 2013.

Here’s a bit of history on why this is happening.

The Child Tax Credit was Scheduled to Drop in 2013

As part of the Obama tax cut deal reached with Republicans, the previous Bush tax cuts that raised the Child Tax Credit to $1,000 from $500 were extended through 2011 and 2012.

Without further extension, the child tax credit was set to drop back down to $500 in 2013.

However, with the fiscal cliff deal, the $1,000 tax credit was extended for at least the next 5 years.

What is the Child Tax Credit?

2013 child tax creditFor those looking for a little more background, the Child Tax Credit allows you to claim a maximum $1,000 per qualified child.

This is a non-refundable income tax credit, meaning that if your credit exceeds your income tax liability, then you won’t get a check for the difference.

Still, non-refundable credits are great, because they represent a subtraction from your actual tax liability, which is much more valuable than a deduction (which is only a subtraction from your taxable income).

However, if your income is below a certain threshold, you can also claim the ‘Additional Child Tax Credit‘, which allows you to get a refund for the difference if your credit exceeds your tax liability.

Can you Claim the Child Tax Credit in the Year the Child was Born?

What if the child was born in the second half of the year, or even the last day? Can you still claim the child tax credit for that year?

In short, yes. Publication 972 lists this as one of the exceptions in which you can claim the credit.

Child Tax Credit Income Levels & Qualifying Criteria

The Child Tax Credit is limited if your MAGI is above a certain amount. The amount at which this phase-out begins varies depending on your filing status. For married taxpayers filing a joint return, the credit phase-out begins at $110,000. For married taxpayers filing a separate return, it’s at $55,000. For all other taxpayers, the phase-out begins at $75,000.

According to the IRS Child Tax Credit FAQ, a qualifying child for this credit is someone who must also meet the qualifying criteria of six tests: age, relationship, support, dependent, citizenship, and residence. So you’ll want to double-check that your child qualifies before filing for the credit.

There are also tax credits for child care you may want to look in to.

Deep Thoughts by G.E. Handy

So, let me first state that I would not recommend anybody schedule a December inducement or c-section for a January estimated due date just to be able to shave off $1,000 in tax liability. But for those due in mid or late December, holding off until January could cost you $1,000!

And to that point, it got me thinking some crazy thoughts…

You would have to assume those that are aware of this special tax scenario are on top of their finances. And they are probably fairly intelligent, or well educated on top of that. Which makes me wonder:

  • Do babies born in the last week of December have a higher average IQ than those born in other weeks of the year?
  • What is the average income of the households they are born into vs. other weeks of the year?

Ponder those deep thoughts for a moment…

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9 Comments »
  • William says:

    Check out the book Outliers by Malcolm Gladwell about kids being born during certain parts of the year. Typically those born nearest the beginning of the school year perform better. Obviously though he is just one guy and not a “definitive” authority.

  • Ron Ablang says:

    I would not expect a “near record number of births the last week of this year” or even a near record number of births in December of this year.

    A lot of families have babies in spite of the economy or in ignorance to those Child Tax Credits. At my age I simply don’t have the luxury of timing.

  • Natalie H says:

    I successfully timed my pregnancy to not be in my third term during the desert summer. The April due date was great for me. However, I doubt anyone would be planning 9 months ahead for that small a tax credit. The difference is only $500. Deep thoughts, though.

  • crazybaby4taxcut says:

    I completely agree with Ron about his comment i know about a hand full of ignorant people who are known to conceive just to get that tax cut and are ignorant enough to admit it in public, if you are settled and have been planning a baby its fine to plan your due date but to do out just for the tax cut its ridiculous and crazy………

  • shoshana says:

    i got a ? i lost my child in october 2012 he only lived for three hours after i gave birth i was wondering if i could claim him on my taxes even though he only lived for three hours someone told me i could just wanted to make sure?

  • bree says:

    OMG is a mother who lost her child at 3 hours old seriously asking if she can claim him/her? Jesus christ the people in this world are becoming more and more pathetic I would be still grieving and so heartbroken I could barely function much less be worrying about THAT

    • MISTY CLOUSE says:

      Bree,since you are so high and mighty, are you going to cough up the funeral expenses for this mother? I don’t think so. In a case like this you should just shut up and not judge her. If she is entitled to money then give her what is due to her. SELF- RIGHTEOUS people like you make me sick!!

  • Ash says:

    Chill Bree. Until you’ve been there you wouldn’t understand. No matter how long a life there are expenses to worry about. Whether you’re ready to think about them or not, the people collecting don’t give a rat’s behind how it feels.

  • Erica says:

    Question. Does the child credit depend on how much you made or is it a flat 500 extra on your refund? Somebody? Thanks ❤

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