$1000 U.S. Child Credit
If applicable, $1,000 per eligible child may be available to offset any potential U.S. income tax liability or refunded. Taxpayers must have reportable earned income from wages (via Israeli Form 106 or similar foreign wage slip) or self-employment income in excess of $3,000. The earned income of both husband and wife can be combined even if one spouse is NOT a U.S. citizen. The non-citizen spouse requires a U.S. tax identification number (TIN), which can be acquired by filing U.S. Tax Form W-7. Children must be U.S. citizens aged 16 and below and must possess a U.S. Social Security number. Please note that maximizing the child credit can be quite complicated since there are many factors to consider. In addition, the IRS has the ability to conduct income tax audits which may require verification of income and other information. Starting in 2018 the refundable child credit increases to $1,400. This will be expanded upon during 2018 in future updates.
U.S. CHILD TAX CREDIT (RECENT CHANGES)
Taxpayer identification number (SSN) is now required by due date of tax return. If you do not have a Social Security Number (SSN) for your dependent by the due date of your 2017 return (including extensions), you may not be able to claim the child tax credit (CTC) or the additional child tax credit (ACTC). This applies to your original or amended 2017 tax return, even if you get the SSN at a later date. (i.e. a child born in March, 2017 has until December 15, 2018 to receive a Social Security Number and still be eligible to claim the child credit.) Taxpayers who exclude earned income, currently up to $102,100 (per taxpayer) on their 2017 joint tax returns will not be eligible to receive a child credit even if only one taxpayer uses the exclusion. Please be advised that the credit may not be able to be claimed retroactively. If you claim the CTC or ACTC, but you are not eligible for either credit and it is later determined that your error was due to reckless or intentional disregard of the CTC or ACTC rules, you will not be allowed to claim either credit for 2 years. If it is determined that your error was due to fraud, you will not be allowed to claim either credit for 10 years. You may also have to pay interest and penalties to the IRS. We recommend applying for Social Security numbers immediately after your U.S. child is born.
For 2018 the child credit increases to $2,000 but the refundable portion is limited to $1,400. The phase-out also increases significantly, which will allow more higher-income earners to qualify for the credit. More details will follow during 2018.
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U.S. CHILD TAX CREDIT (RECENT CHANGES)
Taxpayer identification number (SSN) is now required by due date of tax return. If you do not have a Social Security Number (SSN) for your dependent by the due date of your 2017 return (including extensions), you may not be able to claim the child tax credit (CTC) or the additional child tax credit (ACTC). This applies to your original or amended 2017 tax return, even if you get the SSN at a later date. (i.e. a child born in March, 2017 has until December 15, 2018 to receive a Social Security Number and still be eligible to claim the child credit.) Taxpayers who exclude earned income, currently up to $102,100 (per taxpayer) on their 2017 joint tax returns will not be eligible to receive a child credit even if only one taxpayer uses the exclusion. Please be advised that the credit may not be able to be claimed retroactively. If you claim the CTC or ACTC, but you are not eligible for either credit and it is later determined that your error was due to reckless or intentional disregard of the CTC or ACTC rules, you will not be allowed to claim either credit for 2 years. If it is determined that your error was due to fraud, you will not be allowed to claim either credit for 10 years. You may also have to pay interest and penalties to the IRS. We recommend applying for Social Security numbers immediately after your U.S. child is born.
For 2018 the child credit increases to $2,000 but the refundable portion is limited to $1,400. The phase-out also increases significantly, which will allow more higher-income earners to qualify for the credit. More details will follow during 2018.
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