What’s the difference between the child tax credit and a dependent exemption?
An exemption will directly reduce your income. A credit will reduce your tax liability.
A dependent exemption is the income you can exclude from taxable income for each of your dependents. In 2019, you can exclude $4,200 for each dependent.
The child tax credit:
- Is a credit that offsets the tax you owe dollar for dollar
- Is available if you have a child younger than age 17 at the end of the year
- Can reduce your tax by as much as $1,000, (2003 – 2019, through the Working Families Tax Relief Act) for each qualifying child
You can only claim the child tax credit if you claim the child as a dependent.
If you meet the requirements, you can claim an exemption for a dependent on your return and the child tax credit for that dependent.
Find out more about the gross cap on medical expenses with help from the tax experts at H&R Block.
Need to attach documents to your e-filed return? Find out from the tax experts at H&R Block about how Form 8453 is used to e-file your return.
Discover your tax filing status if married to a non-resident alien with help from the tax experts from H&R Block.
Find out if you can claim unreimbursed employee business expenses with the help of H&R Block. Learn about the TCJA changes to business expenses deductions.