What IRS Form 1040A Schedule 8812 (2015) Is For
IRS Form 1040A Schedule 8812 (2015) is used to calculate the child tax credit and the additional child tax credit when a taxpayer cannot use the full credit to reduce their federal income tax liability. It helps eligible families claim a refundable credit when earned income is high enough to qualify for financial relief. The form applies to qualifying children who meet specific requirements and allows taxpayers to include the credit on their federal income tax return for tax year 2015.
When You’d Use IRS Form 1040A Schedule 8812 (2015)
This form is used in specific situations when taxpayers need to determine whether they qualify for the additional Child Tax Credit.
- Limited Regular Child Tax Credit due to Tax Liability: Taxpayers use this form when their federal income tax liability is not large enough to claim the full child tax credit, and they must calculate the additional child tax credit.
- Qualifying child without a Social Security Number: Taxpayers use this form when a qualifying child has an individual taxpayer identification number and must meet resident alien or bona fide resident requirements.
- Earned income qualifies for a refundable credit: Taxpayers use this form when their earned income or self-employment income exceeds the minimum threshold needed to claim the additional child tax credit.
- Late or amended filing for the same tax year: Taxpayers use this form when filing a late or amended tax return for the same tax year, provided valid identification existed by the due date.
Key Rules or Details for Tax Year 2015
Several key rules apply when filing IRS Form 1040A, Schedule 8812 (2015), to ensure accurate calculations and proper eligibility.
- Qualifying child requirement: A qualifying child must meet relationship, residency, age, dependency, and support tests before taxpayers may claim the child tax credit or claim the additional child tax credit.
- Income level and phaseouts: The credit begins to phase out when modified adjusted gross income exceeds limits based on filing status, such as married filing jointly or filing jointly, which reduces the available credit amount.
- Earned income threshold: To be eligible for the refundable credit that supports financial relief, earned income must exceed $3,000.
- Restrictions on foreign-earned income: Filing Form 2555 for foreign-earned income prevents taxpayers from claiming the additional child tax credit, although they may still claim the regular child tax credit.
- Three or more qualifying children rule: Families with three or more dependent children may be eligible for a larger maximum credit amount when Social Security taxes support the alternative calculation method.
- Identification rules: Taxpayers must have valid identification numbers for each child, generally to avoid improper claims that result from reckless or intentional disregard of IRS rules.
For more information about the underlying return, review our IRS Form 1040A – Simplified Individual Return resource.
Step-by-Step (High Level)
These steps outline the general process for completing IRS Form 1040A Schedule 8812 (2015) accurately.
- Start with identification tests: Taxpayers must determine whether any qualifying child has an individual taxpayer identification number and meets resident alien or bona fide resident requirements before completing the remaining parts of the form.
- Calculate the initial child tax credits: Taxpayers must calculate the regular child tax credits and determine how much of the credit remains unused against their tax liability.
- Determine earned income: Taxpayers must review their earned income, gross income, self-employment income, and nontaxable combat pay to confirm whether they meet the earned income threshold.
- Apply the earned income formula: Taxpayers must multiply earned income above the threshold to calculate the refundable credit amount for the additional child tax credit.
- Use the alternative method if needed: Taxpayers with two or more qualifying children may calculate their credit using the alternative method, which considers social security taxes and other tax credits when it provides a higher credit.
- Finalize the total credit: Taxpayers must compare all calculations and enter the correct total credit on their federal income tax return to claim the credit.
If you need to catch up on past returns, learn about filing an unfiled federal income tax return for previous years.
Common Mistakes and How to Avoid Them
These frequent errors can prevent taxpayers from receiving the correct child tax credit or additional child tax credit.
- Missing or invalid identification numbers: Taxpayers should verify that each qualifying dependent has a valid Social Security Number or individual taxpayer identification number by the due date to prevent delayed processing.
- Incorrect age or support calculations: Taxpayers should confirm the child’s birth certificate information and ensure the child did not provide more than half of their own support for the year.
- Earned income worksheet mistakes: Taxpayers should use the correct tax forms and enter only eligible earned income and self-employment income to avoid miscalculations.
- Skipping the alternative calculation for larger families: Taxpayers should complete the alternative calculation when they have three dependent children to ensure they receive the highest refundable credit available.
- Foreign Earned Income Errors: Taxpayers should avoid claiming the additional child tax credit if they filed Form 2555 for foreign earned income, as this disqualifies them from the refundable portion.
- Math or clerical error notices: Taxpayers should carefully double-check every line to prevent IRS math or clerical error notices that can delay a tax refund.
What Happens After You File
After submitting IRS Form 1040A Schedule 8812 (2015) with the federal income tax return, the IRS reviews calculations to confirm the correct credit amount and verifies identifying information for qualifying dependents. Refunds issued through the additional child tax credit are typically delivered by direct deposit or paper check, and payment timing may vary based on processing needs. The IRS may hold refunds to review potential improper claims, and the refund does not count as income for specific temporary assistance programs that measure financial support.
Need help with a child tax credit question or IRS notice? Start Your Case Review to get professional answers today.
FAQs
Can I claim the additional child tax credit if I owe no federal income tax?
Yes, you may still receive the additional child tax credit. It is a refundable credit that can be paid even when your federal income tax liability is zero, as long as you meet the earned income requirements for the tax year.
Does my adopted child qualify for the maximum child tax credit?
Yes, an adopted child qualifies for the maximum child tax credit if the adopted child lived with you for the required portion of the year. They should also meet all qualifying child requirements, including age, support, and residency rules.
What happens if one or both parents claim the same child in the same tax year?
Suppose the same child appears on more than one federal income tax return. In that case, the IRS applies tiebreaker rules that consider residency, custodial parent rights, and adjusted gross income to determine which parent is entitled to claim the child.
Can a noncustodial parent claim the child credit?
A noncustodial parent may claim the child credit only if the custodial parent signs a written release for the tax year. The child must still meet the qualifying child tests for the parent claiming the credit.
Do I need a tax professional to file Schedule 8812 for me?
A tax professional is not required, but some eligible taxpayers prefer assistance if they have multiple qualifying children, complex income situations, or prior issues with improper claims or calculation errors.