Basics on the CTC
The Child Tax Credit (CTC) is a federal tax credit that helps families with qualifying children reduce their federal income tax liability.
The child tax credit comprises two components:
- Nonrefundable child tax credit (CTC); and
- The refundable portion of the CTC, which is the Additional Child Tax Credit (ACTC).
IRS Letter 6419
The IRS is mailing taxpayers an IRS Letter 6419, which confirms the total dollar amount of advanced child tax credit payments the taxpayer received during the 2021 calendar year. These amounts represent an advanced payment of the child tax credit, which is claimed on Schedule 8812 (Credits for Qualifying Children).
The Letter 6419 is important for two main reasons:
- Taxpayers should confirm the amount of cash actually received matches the IRS records; and
- Use the information reported on LTR 6419 to complete Schedule 8812 (Credits for Qualifying Children).
The advanced child tax credit payments do not increase the CTC amount available to the taxpayer – it is simply an advanced amount.
Sample Fact Pattern for Letter 6419 and Schedule 8812
John is a single-filing taxpayer and has a 13-year-old son. John’s prior year tax return information indicates he is eligible for the CTC for the 2021 tax year.
John received advanced child tax credit payments totaling $1,250 during the 2021 calendar year. John received Letter 6419, which confirms that he received $1,250 in advanced payments.
When John prepares Schedule 8812, he calculates his total child tax credit amount is $3,000. John accounts for the $1,250 already received, which means he is due a net amount of $1,750 of unpaid child tax credit.
Additional Pages Covering the Child Tax Credit
- CTC with Two Qualifying Children
- Filing Amended Form 1040 for the CTC
- What is the Support Test
- Impact on Unemployment Benefits
- Income Thresholds and Phaseouts
- CP79A Notice for Denied CTC
- What is the Additional Child Tax Credit
- Does the Child Need an SSN
- What is a Qualifying Child
- Sample Form 8812 for 2022
- Form 8862 for Disallowed Credit
- Grandparents Claim Grandchild for CTC
- CTC with No Income – 2022 Tax Returns
- CTC with No Income – 2023 Tax Returns
More Information on the Child Tax Credit
Taxpayers seeking more information on child tax credits can visit the IRS website and the IRS Form 8812 instructions for CTC and ACTC. The IRS Publication 501 (Dependents, Standard Deductions, and Filing Information) contains guidance on which persons can be claimed as dependents on Form 1040 (US Individual Income Tax Return).