The Child Tax Credit Still Exists, but the Expanded Version Ended

The Child Tax Credit is a permanent part of the tax code. You can claim it on your tax return right now if you have may have access to children. However, the expanded version that ran from 2021 through 2022 — which gave larger payments and let you receive them monthly instead of only at tax time — is no longer in effect.

The expanded credit was created by the American Rescue Plan Act in March 2021. It increased the credit amount and changed how and when families received the money. That temporary expansion ended on December 31, 2022. Starting with the 2023 tax year, the credit went back to its previous structure.

Key Takeaways

  • The Child Tax Credit remains available, but the expanded version that provided monthly payments ended after 2022.
  • For 2023 and later tax years, the credit is $2,000 per may have access to child under age 17, claimed when you file your return.
  • You receive the full credit as a refund or reduction in taxes owed, not as monthly payments like the 2021–2022 expansion offered.
  • Income limits explore: the credit begins to reduce if your income exceeds $400,000 for married couples filing jointly or $200,000 for single filers.

How the Expanded Credit Worked (2021–2022)

During 2021 and 2022, the Child Tax Credit was temporarily larger and paid differently. The credit was up to $3,600 per child under age 6 and up to $3,000 per child ages 6 to 16. Families could receive half the credit as monthly payments from the IRS, starting in July 2021, and claim the other half when filing their tax return.

The monthly payments were automatic for most families who had filed a 2020 tax return. Families could also use the IRS's Child Tax Credit Update Portal to register if they had not filed a return or needed to update their information. This was a significant change from how the credit normally works — most tax credits are only available when you file your return.

The Current Child Tax Credit (2023 and Later)

Starting with the 2023 tax year, the credit returned to $2,000 per may have access to child under age 17. You claim this credit on your tax return when you file, and you receive it as a reduction in the taxes you owe or as part of your refund. There are no monthly payments.

To claim the credit, your child must be a U.S. citizen, national, or resident alien with a valid Social Security number. The child must be under age 17 at the end of the tax year, and you must be their parent or legal guardian. The child must have lived with you for more than half the year.

The credit phases out if your income is above certain thresholds. For 2023, the credit begins to reduce if your modified adjusted gross income exceeds $400,000 for married couples filing jointly, $200,000 for single filers, or $200,000 for heads of household. The reduction is $50 for each $1,000 (or fraction thereof) over the threshold.

Why the Expansion Ended

The expanded Child Tax Credit was part of temporary pandemic relief. Congress designed it to provide when ready support to families during the economic disruption caused by COVID-19. The law that created it set an expiration date of December 31, 2022, meaning the expansion was always meant to be temporary unless Congress voted to extend it.

Congress did not pass legislation to extend the expanded credit beyond 2022. As a result, the credit reverted to its previous amount and payment structure for the 2023 tax year and beyond. This is why families who received monthly payments in 2021 and 2022 no longer receive them.

What to Do If You Received Monthly Payments

If you received monthly Child Tax Credit payments in 2021 or 2022, you may need to reconcile those payments when you file your tax return for that year. Reconciliation means comparing the advance payments you received to the total credit you are may have access to to claim.

The IRS sends a letter (Form 6419) showing the total advance payments you received during the year. When you file your return, you report this amount, and the IRS calculates whether you received too much, too little, or the correct amount. If you received more than you were may have access to to, you may owe money back, though some families were protected from repayment under rules that applied to 2021 payments.

Keep any letters from the IRS about your advance payments. These documents help you complete your tax return accurately and explain any differences between what you received and what you claim.

Income Limits and Phase-Out Rules

The Child Tax Credit is not available to all families. Your income determines whether you can claim the full credit, a reduced credit, or no credit at all. The income thresholds are based on your modified adjusted gross income, which is usually your total income minus certain deductions.

For 2023, the credit is fully available if your income is at or below $400,000 (married filing jointly), $200,000 (single or head of household), or $200,000 (married filing separately). For each $1,000 over these limits, the credit reduces by $50. This means if your income is $401,000 and you file jointly, your credit reduces by $50. If your income is $401,500, your credit reduces by $100.

How to Claim the Credit on Your Tax Return

When you file your tax return, you report the Child Tax Credit on Schedule 8812 (if you have other credits) or directly on your Form 1040, depending on your situation. You will need your child's full name and Social Security number, their relationship to you, and the number of months they lived with you during the year.

If you use tax preparation software or work with a tax professional, they will guide you through the questions needed to claim the credit. Make sure you have your children's Social Security numbers ready and accurate information about their ages and residency. Errors in this information can delay your refund or trigger an IRS notice.

Frequently Asked Questions

Can I still get the expanded Child Tax Credit amount of $3,000 or $3,600?

No. The expanded amounts were only available for 2021 and 2022. For 2023 and later tax years, the credit is $2,000 per child. The expansion was temporary relief that Congress did not extend.

Will I have to pay back the monthly payments I received in 2021 and 2022?

It depends on your income and the year. For 2021 payments, families with income under $400,000 (married filing jointly) were protected from repayment. For 2022 payments, you may owe money back if you received more than you were may have access to to based on your final income. The IRS will calculate this when you file your return.

What if my income changed after I received advance payments?

Report your actual income for the year on your tax return. The IRS will reconcile the advance payments you received against the credit you are may have access to to claim based on your final income. If you received too much, you may owe the difference. If you received too little, you will receive the additional credit on your refund.

Do I have to file a tax return to claim the Child Tax Credit?

Yes. The Child Tax Credit is only available when you file a tax return. Even if you have no tax liability, you should file to claim the credit, as it may result in a refund to you.

What if my child was born in December — can I claim the credit?

Yes, if your child was born by December 31 of the tax year. The child's age is determined as of December 31, so a child born on December 31 counts as age 1 for that year. You can claim the credit for any child under age 17 at the end of the tax year.