IRS Child Tax Credit Refund Child Care Tax Credit in 2008 2009

If you have a child in your home, you may qualify for a Child Tax Credit in 2008 2009 Income Tax Return. However you must know if you actually qualify for Child Tax Credit and if yes, then how much tax credit can you claim. According to IRS, if you meet the following requirements your child qualifies for a Tax Credit Refund.

1. Is a United States citizen, a United States resident, or a national of the United States,
2. Is under age 17 at the end of the calendar year in which your tax year begins,
3. Is your son, daughter, stepson, stepdaughter, legally adopted child, or a child placed with you for legal adoption, brother, sister, stepbrother stepsister, foster child placed with you by an authorized placement agency or by a court order, or a descendant of any such person, and who
4. Shares with you the same principal place of abode for more than one-half of the tax year, or is treated as your qualifying child under the special rule for parents who are divorced, separated, or living apart.

The Child Tax credit is limited if your modified adjusted gross income is above a certain amount. Often, the child tax credit is limited also by the sum of your income tax liability and any alternative minimum tax liability. For example, if the amount of the credit is $1500, but the amount of your income tax is $700, the tax credit will be limited to $700. However, there are two exceptions to this general rule. First, if the amount of your child tax credit is greater than the amount of your income taxes, you may be able to claim an "additional" tax child tax credit if your earned income exceeds the base amount for the year. Second, if you have three or more qualifying children, you may be able to claim an additional child tax credit up to the amount of Social Security taxes you paid during the year, less any earned income credit you receive. If you qualify under both these exceptions, you receive the greater of the two additional amounts. Most important rule while computing Child Tax Credit: The total amount of the child tax credit and any additional child tax credit cannot exceed the maximum amount allowed for the taxable year. You should include Child Tax Credit into 1040 and following 1040 Instructions to fill up. You can Use Form 8812 (PDF) to figure the additional child tax credit and attach it to your return. If you received any dependent care benefits from your employer during the year, you may be able to exclude from your income all or part of them. You must complete Part III of Form 2441 or Schedule 2 (Form 1040A) before you can figure the amount of your credit. In most cases, payments for babysitting may be qualified as child care expenses if the family member babysitting is not your dependent or your child under age 19 and you otherwise qualify to claim the child and dependent care credit.