The Child Tax Credit

• Probably one of the most well known tax credits for the kids in your life is the Child Tax Credit. This credit can give you up to $1,000 in tax credits per child, and it is potentially refundable depending on your income by utilizing the "additional" Child Tax Credit. The age rules for this credit require that the child be age 16 or under at the end of the tax year. If you child is older than 16, you cannot take this credit.
  
  

Other Qualifications --- Child Tax Credit

• A child must meet additional guidelines for you to claim a Child Tax Credit. The child must be your son or daughter, or brother or sister. Step-relatives also qualify, as do the descendants of any of these relatives. You must claim the child as your dependent, and he must have lived with you for over one-half of the year. The child must not have paid over one-half of his own support. As of April 2011, if you are married filing jointly, the tax credit begins to phase out if you make over $110,000 in adjusted gross income, with lower amounts for other filers.
  
  

Earned Income Tax Credit

• The Earned Income Tax Credit (EITC) is available for lower income taxpayers who have a qualifying child. This is a refundable credit, meaning you may receive a tax refund even if you did not have any income tax withheld. Most people qualifying for the EITC have at least one qualifying child, which is a son or daughter, or a sister or brother. The child can also be a step-sibling or stepchild, or a descendant of one of these. Adopted and foster children qualify. The child must be under age 19, or 24 if a full-time student, and younger the you or your spouse. The child must also have lived with you for over half of the year in the U.S. The credit varies depending on the number of children and income.
  
  

Exemptions

• While not a tax credit in the traditional sense of the word, exemptions allowed for dependents, including your children, have a significant impact on your tax liability. Any qualifying child for the EITC usually qualifies for an exemption claim on your tax return. You must provide over one-half of his support, and the child generally must live with you for over one half of the year. The rules become more complicated with divorced parents and some other relationships, but generally your children under age 19, or 23 if they are full-time students, will qualify. Each exemption allows you to deduct $3,650 from your taxable income as of 2010.