Child Tax Credit and ACTC calculator.

How the credit is calculated

Credit = $2,200 × qualifying children, reduced by $50 for each $1,000 (or part of $1,000) that MAGI exceeds $200,000 ($400,000 joint), never below zero. Tax reduction = the smaller of the credit and your income tax. ACTC = the smallest of the unused credit, $1,700 × children, and 15% × (earned income − $2,500).

Worked example

Single parent, 2 children, MAGI and earned income $30,000, income tax $1,200. Credit: 2 × $2,200 = $4,400 (no phase-out). $1,200 offsets tax. Unused credit is $3,200. Refundable cap is 2 × $1,700 = $3,400. Earned income limit is 15% × ($30,000 − $2,500) = $4,125. ACTC is the smallest, $3,200, so the total benefit is $4,400.

Phase-out example: one child and MAGI of $210,500 is $10,500 over $200,000, which is 11 steps (10.5 rounded up). 11 × $50 = $550, so the credit is $2,200 − $550 = $1,650.

Qualifying child rules (not decided for you)

• Under 17 at the end of the tax year.
• Did not provide more than half of their own support, and lived with you for more than half the year.
• The child has a Social Security number, issued before the return due date (including extensions), for the Child Tax Credit. An ITIN or ATIN child may qualify for a smaller credit instead; see the IRS page.
• You (and your spouse, on a joint return) need a Social Security number valid for employment in the United States, issued before the due date.
• The child is your son, daughter, stepchild, foster child, sibling or a descendant of one, and is claimed as your dependent.

What this estimate leaves out

• The $500 Credit for Other Dependents, which is nonrefundable and reduced by the same phase-out.
• The alternative refundable test for families with three or more children, which can allow a larger ACTC in some cases (26 U.S.C. 24(d)).
• Other credits, state credits and withholding.

FAQ

What is the difference between the CTC and the ACTC? The CTC lowers the tax you owe. If the credit is bigger than your tax, the ACTC is the refundable part you can get back.

Do I need earned income? Yes for the ACTC: you must have at least $2,500 of earned income. The credit that offsets tax does not have that requirement.

Which years do these figures cover? The IRS lists $2,200 and $1,700 for tax year 2025, and Rev. Proc. 2025-32 sets the same amounts for tax years beginning in 2026. As-of year shown: 2026.

Official sources: IRS Child Tax Credit page, Rev. Proc. 2025-32 (section 3.05) and 26 U.S.C. 24 (the $50 per $1,000 phase-out and the 15% earned income test). IRS page last reviewed September 21, 2026; rules verified October 1, 2026.