What Is a Qualifying Child for the Child Tax Credit?

The Child Tax Credit (CTC) helps families reduce their federal income tax liability, but not every child qualifies. The IRS has specific requirements, including relationship, age, residency, financial support, and identification. Tie-breaker rules apply if multiple people attempt to claim the same child.

Relationship Criteria

To qualify, the child must have a direct familial relationship with the taxpayer. Eligible relationships include biological children, stepchildren, legally adopted children, and foster children placed by an authorized agency or court order. Grandchildren also qualify.

Siblings and their children can also be eligible. This includes brothers, sisters, half-siblings, step-siblings, nieces, and nephews. However, cousins do not qualify, even if they live with and are financially supported by the taxpayer.

A legally adopted child is treated as a biological child for tax purposes, even if the adoption is not finalized by the end of the tax year. Foster children qualify if they are placed by a recognized agency or court order.

Age Criteria

In 2024, a child must be under 17 at the end of the tax year to qualify, meaning they must be 16 or younger on December 31. Once they turn 17, they are no longer eligible, regardless of when their birthday falls during the year.

This rule applies even if the child is still in high school or financially dependent on their parents. Other tax benefits, like the Credit for Other Dependents, may apply to older children who no longer meet the CTC age limit but still rely on their parents.

Residency Criteria

A child must have lived with the taxpayer for more than half the tax year—at least 183 nights—to qualify. Temporary absences, such as time spent at school, in medical care, or on military service, do not count against this requirement if the child would have otherwise lived with the taxpayer.

For divorced or separated parents, the custodial parent—the one with whom the child spends the majority of nights—typically claims the credit. The noncustodial parent may claim it only if the custodial parent signs IRS Form 8332, releasing the exemption. Without this form, the IRS defaults to awarding the credit to the parent with primary custody.

Taxpayers who move during the year may need documentation to prove residency. School records, medical records, and official correspondence, such as utility bills or lease agreements listing the child’s address, can help verify residency. The IRS may request such evidence if multiple people attempt to claim the same child or if a return is flagged for review.

Support Requirements

A qualifying child must not provide more than half of their own financial support during the tax year. Support includes necessities such as food, housing, clothing, education, and medical care.

If a child has earned income, received Social Security benefits, or had investment income, these amounts must be considered. For example, if a child earns $10,000 in wages but total support expenses amount to $25,000, they have not provided more than half of their own support and still qualify. However, if a child has substantial income from trust distributions or scholarships that cover living expenses, these amounts may affect eligibility. Scholarships used exclusively for tuition do not count as the child’s contribution to support.

Identification Criteria

A child must have a valid Social Security Number (SSN) issued before the tax return’s due date, including extensions, to qualify. An Individual Taxpayer Identification Number (ITIN) or an Adoption Taxpayer Identification Number (ATIN) does not meet this requirement, though they may allow the taxpayer to claim other credits, such as the Credit for Other Dependents.

If a child does not have an SSN by the filing deadline, the taxpayer cannot retroactively claim the credit for that year, even if the number is issued later. Parents of newborns or newly adopted children should apply for an SSN as soon as possible. If an SSN is incorrect on tax documents, the IRS may delay processing the return or deny the credit. Ensuring that the SSN matches the child’s legal name as recorded with the Social Security Administration helps prevent these issues.

Tie-Breaker Rules for Multiple Claimants

When more than one taxpayer attempts to claim the same child, the IRS applies tie-breaker rules. The parent with whom the child lived the longest during the tax year has priority. If the child spent an equal number of nights with both parents, the credit goes to the parent with the higher adjusted gross income (AGI).

If neither claimant is the child’s parent, such as when a grandparent or other relative provides care, the IRS again uses AGI to determine eligibility. The taxpayer with the highest AGI can claim the credit. However, if a parent is also eligible, they take precedence over a non-parent, regardless of income. These rules ensure the credit is awarded fairly and prevent multiple claims for the same child.