What changes to the Child Tax Credit are coming in 2024 and will they be retroactive to 2023?

The Child Tax Credit changes can definitely be confusing! Let me break this down: For 2023 taxes (filing now in 2024), the Child Tax Credit is still $2,000 per qualifying child, and you need earned income to receive the refundable portion. Without income, you could only get the non-refundable portion, which only helps if you owe taxes. The new bill Congress is working on does make changes, but they're primarily for 2024 (filing in 2025) and beyond. The bill would increase the maximum refundable amount per child and allow for a "lookback provision" where you can use your income from the prior year to calculate your credit if it's more beneficial. From what I understand, these changes won't be retroactive to 2023 tax returns. So for someone without income in 2023, the rules remain the same as pre-pandemic - you'd need earned income to receive the refundable portion of the credit.

I was in the same boat trying to figure this out for my sister who didn't work last year but has three kids. I finally found a solution with https://taxr.ai - they have an updated Child Tax Credit analyzer that actually explained all these changes to me in plain English. It confirmed what the previous commenter said - the lookback provision won't help for 2023 taxes, but they showed me some other options my sister might qualify for like the Earned Income Credit if she had any income at all. Their system analyzed her whole situation and gave her personalized advice about whether she could claim partial credits. Has anyone else used this service? I'm curious if others found it as helpful as I did.

Just wanted to update everyone - I decided to try that https://taxr.ai site mentioned earlier. It was actually super helpful! I was confused about whether my wife could claim the Child Tax Credit for 2023 since she didn't work, but the analysis showed that we could still claim it on our joint return based on my income. The explanation was way clearer than what I found on the IRS site. The tool also showed us how the rules will change for 2024, and how we might benefit from the new lookback provision next year depending on my wife's work situation. Definitely worth checking out if you're confused about these credit changes.

For anyone struggling to get answers from the IRS directly about these Child Tax Credit changes, I had success using https://claimyr.com to actually speak with an IRS agent. I had been calling for weeks and couldn't get through, but with Claimyr I had an agent on the phone within about 20 minutes. The agent confirmed that the lookback provision won't apply to 2023 taxes, but they were able to walk me through exactly what credits I qualified for based on my particular situation (I'm a single dad with partial custody). They also explained how the new legislation would affect me for 2024. You can see how the service works here: https://youtu.be/_kiP6q8DX5c - it basically waits on hold with the IRS for you then calls you when an agent picks up. Saved me hours of frustration!

Ok I need to eat my words and apologize to Profile 14. I was so skeptical about Claimyr that I tried it myself, and I'm shocked to say it actually worked. After weeks of getting nowhere, I got connected to an IRS rep in about 35 minutes! The agent confirmed everything about the Child Tax Credit that was mentioned here - the lookback provision is only for 2024 tax year and forward, not for 2023 taxes we're filing now. They also checked on my refund (which was the main reason I was calling) and told me it should be deposited by next Friday. Sorry for being so negative before. When you've dealt with IRS phone hell for weeks, it's hard to believe anything can fix it.

I read the actual text of the bill, and there's another important aspect no one's mentioned yet. Starting in 2024, the refundable portion of the Child Tax Credit is increasing from $1,600 to $1,800 per child, and it will continue increasing in future years. So even though the lookback provision won't help for 2023 taxes, there is a meaningful increase coming for 2024. For parents with multiple children who qualify for the refundable portion, this could mean hundreds of dollars more in their refund next year.

This thread has been super helpful. Just a heads up for anyone with kids - make sure you're also looking into the Earned Income Tax Credit (EITC) if you have lower income. It works differently than the Child Tax Credit and might help you even if you don't qualify for the full CTC. I almost missed out on over $3,000 from the EITC last year until my tax preparer caught it. The income thresholds are different, and you might still qualify for partial EITC even with lower income. Worth checking!

Great question about the EITC! The bill does include some changes to the Earned Income Tax Credit as well, though they're not as significant as the Child Tax Credit modifications. For 2024, the EITC will have slightly adjusted income thresholds and phase-out ranges, but the basic structure remains the same. The maximum credit amounts are also being increased modestly - I believe around $200-300 more for families with children, depending on the number of kids. The good news is that if you qualify for EITC, you can claim it alongside the Child Tax Credit. They work independently of each other. So even if someone doesn't have enough earned income to get the full refundable portion of the CTC, they might still benefit significantly from the EITC. I'd recommend using the IRS EITC Assistant tool on their website - it's actually pretty user-friendly compared to some of their other resources, and it will tell you exactly what you qualify for based on your income and family situation.