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Internal Revenue Code, § 24. Child Tax Credit

I.R.C. § 24(a) Allowance Of Credit
There shall be allowed as a credit against the tax imposed by this chapter for the taxable year with respect to each qualifying child of the taxpayer for which the taxpayer is allowed a deduction under section 151 an amount equal to $1,000.
I.R.C. § 24(b) Limitations
I.R.C. § 24(b)(1) Limitation Based On Adjusted Gross Income
The amount of the credit allowable under subsection (a) shall be reduced (but not below zero) by $50 for each $1,000 (or fraction thereof) by which the taxpayer's modified adjusted gross income exceeds the threshold amount. For purposes of the preceding sentence, the term “modified adjusted gross income” means adjusted gross income increased by any amount excluded from gross income under section 911, 931, or 933.
I.R.C. § 24(b)(2) Threshold Amount
For purposes of paragraph (1), the term “threshold amount” means—
I.R.C. § 24(b)(2)(A)
$110,000 in the case of a joint return,
I.R.C. § 24(b)(2)(B)
$75,000 in the case of an individual who is not married, and
I.R.C. § 24(b)(2)(C)
$55,000 in the case of a married individual filing a separate return.
For purposes of this paragraph, marital status shall be determined under section 7703.
I.R.C. § 24(c) Qualifying Child
For purposes of this section—
I.R.C. § 24(c)(1) In General
The term “qualifying child” means a qualifying child of the taxpayer (as defined in section 152(c)) who has not attained age 17.
I.R.C. § 24(c)(2) Exception For Certain Noncitizens
The term “qualifying child” shall not include any individual who would not be a dependent if subparagraph (A) of section 152(b)(3) were applied without regard to all that follows “resident of the United States”.
I.R.C. § 24(d) Portion Of Credit Refundable
I.R.C. § 24(d)(1) In General
The aggregate credits allowed to a taxpayer under subpart C shall be increased by the lesser of—
I.R.C. § 24(d)(1)(A)
the credit which would be allowed under this section without regard to this subsection and the limitation under section 26(a) or
I.R.C. § 24(d)(1)(B)
the amount by which the aggregate amount of credits allowed by this subpart (determined without regard to this subsection) would increase if the limitation imposed by section 26(a) were increased by the greater of—
I.R.C. § 24(d)(1)(B)(i)
15 percent of so much of the taxpayer's earned income (within the meaning of section 32) which is taken into account in computing taxable income for the taxable year as exceeds $3,000, or
I.R.C. § 24(d)(1)(B)(ii)
in the case of a taxpayer with 3 or more qualifying children, the excess (if any) of—
I.R.C. § 24(d)(1)(B)(ii)(I)
the taxpayer's social security taxes for the taxable year, over
I.R.C. § 24(d)(1)(B)(ii)(II)
the credit allowed under section 32 for the taxable year.
The amount of the credit allowed under this subsection shall not be treated as a credit allowed under this subpart and shall reduce the amount of credit otherwise allowable under subsection (a) without regard to section 26(a). For purposes of subparagraph (B), any amount excluded from gross income by reason of section 112 shall be treated as earned income which is taken into account in computing taxable income for the taxable year.
I.R.C. § 24(d)(2) Social Security Taxes
For purposes of paragraph (1)
I.R.C. § 24(d)(2)(A) In General
The term “social security taxes” means, with respect to any taxpayer for any taxable year—
I.R.C. § 24(d)(2)(A)(i)
the amount of the taxes imposed by sections 3101 and 3201(a) on amounts received by the taxpayer during the calendar year in which the taxable year begins,
I.R.C. § 24(d)(2)(A)(ii)
50 percent of the taxes imposed by section 1401 on the self-employment income of the taxpayer for the taxable year, and
I.R.C. § 24(d)(2)(A)(iii)
50 percent of the taxes imposed by section 3211(a) on amounts received by the taxpayer during the calendar year in which the taxable year begins.
I.R.C. § 24(d)(2)(B) Coordination With Special Refund Of Social Security Taxes
The term “social security taxes” shall not include any taxes to the extent the taxpayer is entitled to a special refund of such taxes under section 6413(c).
I.R.C. § 24(d)(2)(C) Special Rule
Any amounts paid pursuant to an agreement under section 3121(l) (relating to agreements entered into by American employers with respect to foreign affiliates) which are equivalent to the taxes referred to in subparagraph (A)(i) shall be treated as taxes referred to in such subparagraph.
I.R.C. § 24(d)(3) Exception For Taxpayers Excluding Foreign Earned Income
Paragraph (1) shall not apply to any taxpayer for any taxable year if such taxpayer elects to exclude any amount from gross income under section 911 for such taxable year.
I.R.C. § 24(e) Identification Requirements
I.R.C. § 24(e)(1) Qualifying Child Identification Requirement
No credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the name and taxpayer identification number of such qualifying child on the return of tax for the taxable year and such taxpayer identification number was issued on or before the due date for filing such return.
I.R.C. § 24(e)(2) Taxpayer Identification Requirement
No credit shall be allowed under this section if the taxpayer identification number of the taxpayer was issued after the due date for filing the return for the taxable year.
I.R.C. § 24(f) Taxable Year Must Be Full Taxable Year
Except in the case of a taxable year closed by reason of the death of the taxpayer, no credit shall be allowable under this section in the case of a taxable year covering a period of less than 12 months.
I.R.C. § 24(g) Restrictions On Taxpayers Who Improperly Claimed Credit In Prior Year
I.R.C. § 24(g)(1) Taxpayers Making Prior Fraudulent Or Reckless Claims
I.R.C. § 24(g)(1)(A) In General
No credit shall be allowed under this section for any taxable year in the disallowance period.
I.R.C. § 24(g)(1)(B) Disallowance Period
For purposes of subparagraph (A), the disallowance period is—
I.R.C. § 24(g)(1)(B)(i)
the period of 10 taxable years after the most recent taxable year for which there was a final determination that the taxpayer's claim of credit under this section was due to fraud, and
I.R.C. § 24(g)(1)(B)(ii)
the period of 2 taxable years after the most recent taxable year for which there was a final determination that the taxpayer's claim of credit under this section was due to reckless or intentional disregard of rules and regulations (but not due to fraud).
I.R.C. § 24(g)(2) Taxpayers Making Improper Prior Claims
In the case of a taxpayer who is denied credit under this section for any taxable year as a result of the deficiency procedures under subchapter B of chapter 63, no credit shall be allowed under this section for any subsequent taxable year unless the taxpayer provides such information as the Secretary may require to demonstrate eligibility for such credit.
I.R.C. § 24(h) Special Rules For Taxable Years 2018 Through 2025
I.R.C. § 24(h)(1) In General
In the case of a taxable year beginning after December 31, 2017, and before January 1, 2026, this section shall be applied as provided in paragraphs (2) through (7).
I.R.C. § 24(h)(2) Credit Amount—
Subsection (a) shall be applied by substituting “$2,000” for “$1,000”.
I.R.C. § 24(h)(3) Limitation—
In lieu of the amount determined under subsection (b)(2), the threshold amount shall be $400,000 in the case of a joint return ($200,000 in any other case).
I.R.C. § 24(h)(4) Partial Credit Allowed For Certain Other Dependents
I.R.C. § 24(h)(4)(A) In General
The credit determined under subsection (a) (after the application of paragraph (2)) shall be increased by $500 for each dependent of the taxpayer (as defined in section 152) other than a qualifying child described in subsection (c).
I.R.C. § 24(h)(4)(B) Exception For Certain Noncitizens
Subparagraph (A) shall not apply with respect to any individual who would not be a dependent if subparagraph (A) of section 152(b)(3) were applied without regard to all that follows “resident of the United States”.
I.R.C. § 24(h)(4)(C) Certain Qualifying Children
In the case of any qualifying child with respect to whom a credit is not allowed under this section by reason of paragraph (7), such child shall be treated as a dependent to whom subparagraph (A) applies.
I.R.C. § 24(h)(5) Maximum Amount Of Refundable Credit
I.R.C. § 24(h)(5)(A) In General—
The amount determined under subsection (d)(1)(A) with respect to any qualifying child shall not exceed $1,400, and such subsection shall be applied without regard to paragraph (4) of this subsection.
I.R.C. § 24(h)(5)(B) Adjustment For Inflation
In the case of a taxable year beginning after 2018, the $1,400 amount in subparagraph (A) shall be increased by an amount equal to—
I.R.C. § 24(h)(5)(B)(i)
such dollar amount, multiplied by
I.R.C. § 24(h)(5)(B)(ii)
the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “2017” for “2016” in subparagraph (A)(ii) thereof.
If any increase under this clause is not a multiple of $100, such increase shall be rounded to the next lowest multiple of $100.
I.R.C. § 24(h)(6) Earned Income Threshold For Refundable Credit
Subsection (d)(1)(B)(i) shall be applied by substituting “$2,500” for “$3,000”.
I.R.C. § 24(h)(7) Social Security Number Required
No credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the social security number of such child on the return of tax for the taxable year. For purposes of the preceding sentence, the term “social security number” means a social security number issued to an individual by the Social Security Administration, but only if the social security number is issued—
I.R.C. § 24(h)(7)(A)
to a citizen of the United States or pursuant to subclause (I) (or that portion of subclause (III) that relates to subclause (I)) of section 205(c)(2)(B)(i) of the Social Security Act, and
I.R.C. § 24(h)(7)(B)
before the due date for such return.
(Added by Pub. L. 105-34, title I, Sec. 101(a), Aug. 5, 1997, 111 Stat 788; revised Pub. L. 105-206, title VI, Sec. 6003(a), July 22, 1998, 112 Stat 685; Pub. L. 105-277, title II, Sec. 2001(b), Oct. 21, 1998, 112 Stat 2681; Pub. L. 106-170, title V, Sec. 501(b), Dec. 17, 1999, 113 Stat. 1860; Pub. L. 107-16, title II, Sec. 201, 202, title VI, Sec. 618, June 7, 2001, 115 Stat. 38; Pub. L. 107-90, title II, Sec. 204(e)(1), Dec. 21, 2001, 115 Stat. 878; Pub. L. 107-147, title IV, Sec. 411(b), Mar. 9, 2002, 116 Stat. 21; Pub. L. 108-27, title I, Sec. 101(a), May 28, 2003, 117 Stat. 752; Pub. L. 108-311, title I, II, Sec. 101(a), 102(a), 104(a), 204, Oct. 4, 2004, 118 Stat. 1166; Pub. L. 109-135, title IV, Sec. 402(i)(3)(B), Dec. 21, 2005; Pub. L. 110-172, Sec. 11(c)(1), Dec. 29, 2007, 121 Stat. 2473; Pub. L. 110-343, Div. B, Sec. 106(e)(2)(B), 205(d)(1)(A), Div. C, Sec. 501(a), Oct. 3, 2008, 122 Stat. 3765; Pub. L. 110-351, title V, Sec. 501(c)(1), Oct. 7, 2008, 122 Stat. 3949; Pub. L. 111-5, Div. B, title I, Sec. 1003(a), 1004(b)(1), 1142(b)(1)(A), 1144(b)(1)(A), Feb. 17, 2009, 123 Stat. 115; Pub. L. 111-148, Sec. 10909(b)(2)(A), Mar. 23, 2010, 124 Stat. 119; Pub. L. 111-312, title I, Sec. 103(b), Dec. 17, 2010, 124 Stat. 3296; Pub. L. 112-240, title I, Sec. 103(b), 104(c)(2), Jan. 2, 2013, 126 Stat. 2313; Pub. L. 113-295, Div. A, Sec. 209(a), Dec. 19, 2014, 128 Stat. 4010; Pub. L. 114-27, title VIII, Sec. 807(a), June 29, 2015; Pub. L. 114-113, Div. Q, title I, Sec. 101, title II, 205, 208, Dec. 18, 2015; Pub. L. 115-97, title I, Sec. 11022(a), Dec. 22, 2017, 131 Stat. 2054; Pub. L. 115-141, Div. U, title I, Sec. 101(i)(1), title IV, Sec. 401(a)(3), Mar. 23, 2018, 132 Stat. 348.)
BACKGROUND NOTES
AMENDMENTS
2018 — Subsec. (d). Pub. L. 115-141, Div. U, Sec. 401(a)(3), amended subsec. (d) by redesignating par. (5) as par. (3).
Subsec. (e)(2). Pub. L. 115-141, Div. U, Sec. 101(i)(1), amended par. (2) by substituting “taxpayer identification number” for “identifying number”.
2017 — Subsec. (h). Pub. L. 115-97, Sec. 11022(a), amended Sec. 24 by adding subsec. (h).
2015 — Subsec. (d)(1)(B)(i). Pub. L. 114-113, Div. Q, Sec. 101(a), amended clause (i) by substituting “$3,000” for “$10,000”.
Subsec. (d)(3). Pub. L. 114-113, Div. Q, Sec. 101(b), struck par. (3). Before being struck, it read as follows:
“(3) Inflation Adjustment.—In the case of any taxable year beginning in a calendar year after 2001, the $10,000 amount contained in paragraph (1)(B) shall be increased by an amount equal to—
“(A) such dollar amount, multiplied by
“(B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting “calendar year 2000” for “calendar year 1992” in subparagraph (B) thereof.
“Any increase determined under the preceding sentence shall be rounded to the nearest multiple of $50.”
Subsec. (d)(4). Pub. L. 114-113, Div. Q, Sec. 101(b), struck par. (4). Before being struck, it read as follows:
“(4) Special Rule For Certain Years.—In the case of any taxable year beginning after 2008 and before 2018, paragraph (1)(B)(i) shall be applied by substituting “$3,000: for “$10,000”.”
Subsec. (e). Pub. L. 114-113, Div. Q, Sec. 205(a), amended subsec. (e) by inserting ‘‘and such taxpayer identification number was issued on or before the due date for filing such return’’ before the period at the end.
Subsec. (e). Pub. L. 114-113, Div. Q, Sec. 205(b), amended subsec. (e) by substituting “IDENTIFICATION REQUIREMENTS.—(1) QUALIFYING CHILD IDENTIFICATION REQUIREMENT.—No credit shall be allowed’’ for “IDENTIFICATION REQUIREMENT.—No credit shall be allowed’’ and added par. (2).
Subsec. (g). Pub. L. 114-113, Div. Q, Sec. 208(a)(1), added subsec. (g).
Subsec. (d)(5). Pub. L. 114-27, Sec. 807(a), amended subsec. (d) by adding new par. (5).
2014 — Subsec. (d)(4). Pub. L. 113-295, Div. A, Sec. 209(a), amended par. (4). Before amendment, it read as follows:
“(4) Special Rule For Certain Years.—Notwithstanding paragraph (3), in the case of any taxable year beginning after 2008 and before 2018, the dollar amount in effect for such taxable year under paragraph (1)(B)(i) shall be $3,000.”
2013 — Subsec. (b)(3). Pub. L. 112-240, Sec. 104(c)(2)(B)(i), struck par. (3). Before being struck, it read as follows:
“(3) Limitation Based On Amount Of Tax.—In the case of a taxable year to which section 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable year shall not exceed the excess of—
“(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over
“(B) the sum of the credits allowable under this subpart (other than this section and sections 25A(i), 25B, 25D, 30, 30B, and 30D) and section 27 for the taxable year.”
Subsec. (d)(1). Pub. L. 112-240, Sec. 104(c)(2)(B)(ii)(II), amended par. (1) by substituting “section 26(a)” for “section 26(a)(2) or subsection (b)(3), as the case may be” in the second last sentence.
Subsec. (d)(1)(A)-(B). Pub. L. 112-240, Sec. 104(c)(2)(B)(ii)(I), amended subpar. (A) and (B) by substituting “section 26(a)” for “section 26(a)(2) or subsection (b)(3), as the case may be,” each place it appears.
Subsec. (d)(4). Pub. L. 112-240, Sec. 103(b), amended par. (4) by substituting “For Certain Years” for “2009, 2010, 201, And 2012” in the heading and by substituting “after 2008 and before 2018” for “in 2009, 2010, 2011, or 2012”.
2010 — Subsec. (d)(4). Pub. L. 111-312, Sec. 103(b), amended par. (4) by substituting “2009, 2010, 2011, And 2012” for “2009 And 2010” in the heading and by substituting “, 2010, 2011, or 2012” for “or 2010” in the text.
Subsec. (b)(3)(B). Pub. L. 111-148, Sec. 10909(b)(2)(A), amended subpar. (B) by striking “23,”.
2009 — Subsec. (b)(3)(B). Pub. L. 111-5, Div. B, Sec. 1004(b)(1), amended subpar. (B) by inserting “25A(i),” after “23,”.
Subsec. (b)(3)(B). Pub. L. 111-5, Div. B, Sec. 1142(b)(1)(A), amended subpar. (B) by inserting “30,” after “25D,”.
Subsec. (b)(3)(B). Pub. L. 111-5, Div. B, Sec. 1144(b)(1)(A), amended subpar. (B) by inserting “30B,” after “30,”.
Subsec. (d)(4). Pub. L. 111-5, Div. B, Sec. 1003(a), amended par. (4). Before amendment, it read as follows:
“(4) Special Rule For 2008.—Notwithstanding paragraph (3), in the case of any taxable year beginning in 2008, the dollar amount in effect for such taxable year under paragraph (1)(B)(i) shall be $8,500.”
2008 - Subsec. (a). Pub. L. 110-351, Sec. 501(c)(1), amended subsec. (a) by inserting “for which the taxpayer is allowed a deduction under section 151” after “of the taxpayer”.
Subsec. (b)(3)(B). Pub. L. 110-343, Div. B, Sec. 106(e)(2)(B), amended subpar. (B) by substituting “, 25B, and 25D” for “and 25B”.
Subsec. (b)(3)(B). Pub. L. 110-343, Div. B, Sec. 205(d)(1)(A), amended subpar. (B) by substituting “25D, and 30D” for “and 25D”.
Subsec. (d)(4). Pub. L. 110-343, Sec. 501(a), amended subsec. (d) by adding par. (4)
2007 - Subsec. (d)(1)(B). Pub. L. 110-172, Sec. 11(c)(1)(A), amended subpar. (B) by substituting “the greater of” for “the excess (if any) of”.
Subsec. (d)(1)(B)(ii)(II). Pub. L. 110-172, Sec. 11(c)(1)(B), amended subclause (II) by substituting “section 32” for “section.
2005 - Subsec. (b)(3). Pub. L. 109-135, Sec. 402(i)(3)(B)(i), amended par. (3) by substituting “In the case of a taxable year to which section 26(a)(2) does not apply, the credit” for “The credit" in the matter preceding subpar. (A).
Subsec. (d)(1). Pub. L. 109-135, Sec. 402(i)(3)(B)(ii), amended par. (1). Before amendment, it read as follows:
“(d) Portion of Credit Refundable.--
“(1) IN GENERAL.--
“The aggregate credits allowed to a taxpayer under subpart C shall be increased by the lesser of--
“(A) the credit which would be allowed under this section without regard to this subsection and the limitation under subsection (b)(3), or
“(B) the amount by which the aggregate amount of credits allowed by this subpart (determined without regard to this subsection) would increase if the limitation imposed by subsection (b)(3) were increased by the greater of--
“(i) 15 percent of so much of the taxpayer's earned income (within the meaning of section 32) which is taken into account in computing taxable income for the taxable year as exceeds $10,000, or
“(ii) in the case of a taxpayer with 3 or more qualifying children, the excess (if any) of--
“(I) the taxpayer's social security taxes for the taxable year, over
“(II) the credit allowed under section 32 for the taxable year.
“The amount of the credit allowed under this subsection shall not be treated as a credit allowed under this subpart and shall reduce the amount of credit otherwise allowable under subsection (a) without regard to subsection (b)(3). For purposes of subparagraph (B), any amount excluded from gross income by reason of section 112 shall be treated as earned income which is taken into account in computing taxable income for the taxable year.”
2004 - Subsec. (a). Pub. L. 108-311, Sec. 101(a), amended subsec. (a). Before amendment, it read as follows:
“(a) Allowance of Credit.--
“(1) In general.--
“There shall be allowed as a credit against the tax imposed by this chapter for the taxable year with respect to each qualifying child of the taxpayer an amount equal to the per child amount.
“(2) PER CHILD AMOUNT.--
“For purposes of paragraph (1), the per child amount shall be determined as follows:
 

In the case of any taxable           The per child amount is-- 
year beginning in-- 
2003 or 2004                            $1,000
2005, 2006, 2007, or 2008                  700
2009                                       800
2010 or thereafter                       1,000.”
Subsec. (c)(1). Pub. L. 108-311, Sec. 204(a), amended par. (1). Before amendment, it read as follows:
“(1) In general.--
“The term ‘qualifying child’ means any individual if--
“(A) the taxpayer is allowed a deduction under section 151 with respect to such individual for the taxable year,
“(B) such individual has not attained the age of 17 as of the close of the calendar year in which the taxable year of the taxpayer begins, and
“(C) such individual bears a relationship to the taxpayer described in section 32(c)(3)(B).”
Subsec. (c)(2). Pub. L. 108-311, Sec. 204(b), amended par. (2) by substituting “subparagraph (A) of section 152(b)(3)" for “the first sentence of section 152(b)(3)”.
Subsec. (d)(1). Pub. L. 108-311, Sec. 104(a), amended par. (1) by adding the sentence at the end.
Subsec. (d)(1)(B). Pub. L. 108-311, Sec. 102(a), amended subpar. (B) by striking “(10 percent in the case of taxable years beginning before January 1, 2005)” after “15 percent”.
2003 - Subsec. (a)(2). Pub. L. 108-27, Sec. 101(a), amended the table in par. (2) by substituting “2003 or 2004 ....... $1,000” for “2001, 2002, 2003, or 2004 ....... 600”.
2002 - Subsec. (d)(1)(B). Pub. L. 107-147, Sec. 411(b), amended subpar. (B) by substituting “aggregrate amount of credits allowed by this subpart” for “amount of credit allowed by this section”.
2001 - Subsec. (d)(2)(A)(iii). Pub. L. 107-90, Sec. 204(e)(1) amended clause (iii) by substituting “section 3211(a)” for “section 3211(a)(1)”. Note, Act Sec. 204(e)(1) provided that this amendment should be made to (d)(3)(A)(iii); however, par. (3) was redesignated as par. (2) by Pub. L. 107-16, Sec. 201(d), effective for tax years beginning after Dec. 31, 2000.
Subsec. (a). Pub. L. 107-16, Sec. 201(a), amended subsec. (a). Before amendment it read as follows:
“(a) Allowance of Credit.--
“There shall be allowed as a credit against the tax imposed by this chapter for the taxable year with respect to each qualifying child of the taxpayer an amount equal to $500 ($400 in the case of taxable years beginning in 1998).”
Subsec. (b). Pub. L. 107-16, Sec. 201(b)(2)(A), amended the heading of subsec. (b) by substituting “Limitations.-" for “Limitation based on adjusted gross income.-”.
Subsec. (b)(1). Pub. L. 107-16, Sec. 201(b)(2)(B), amended the heading of par. (1) by substituting “Limitation based on adjusted gross income.--” for “In general.-”.
Subsec. (b)(3). Pub. L. 107-16, Sec. 201(b)(1), added par. (3).
Subsec. (b)(3)(B). Pub. L. 107-16, Sec. 202(f)(2)(B), amended subpar. (B) by substituting “this section and section 23" for “this section”.
Subsec. (b)(3)(B). Pub. L. 107-16, Sec. 618(b)(2)(A), amended subpar. (B) by substituting “sections 23 and 25B” for “section 23”.
Subsec. (d). Pub. L. 107-16, Sec. 201(b)(2)(C)(i), amended subsec. (d) by substituting “subsection (b)(3)” for “section 26(a)” each place it appeared.
Subsec. (d)(1)(B). Pub. L. 107-16, Sec. 201(b)(2)(C)(ii), amended subpar. (B) by substituting “amount of credit allowed by this section” for “aggregate amount of credits allowed by this subpart”.
Subsec. (d). Pub. L. 107-16, Sec. 201(c)(1), amended so much of sec. 24(d) as precedes par. (2). Before amendment it read as follows:
“(d) Additional Credit for Families With 3 or More Children.--
“(1) In general.--In the case of a taxpayer with 3 or more qualifying children for any taxable year, the aggregate credits allowed under subpart C shall be increased by the lesser of--
“(A) the credit which would be allowed under this section without regard to this subsection and the limitation under section 26(a), or
“(B) the amount by which the aggregate amount of credits allowed by this subpart (without regard to this subsection) would increase if the limitation imposed by section 26(a) were increased by the excess (if any) of--
“(i) the taxpayer's social security taxes for the taxable year, over
“(ii) the credit allowed under section 32 (determined without regard to subsection (n)) for the taxable year.
“The amount of the credit allowed under this subsection shall not be treated as a credit allowed under this subpart and shall reduce the amount of credit otherwise allowable under subsection (a) without regard to section 26(a).”
Subsec. (d)(4). Pub. L. 107-16, Sec. 201(c)(2), added par. (4).
Subsec. (d)(2)-(4). Pub. L. 107-16, Sec. 201(d), struck par. (2) and redesignated par. (3) and (4) as par. (2) and (3), respectively. Before being struck, par. (2) read as follows:
“(2) Deduction of credit to taxpayer subject to alternative minimum tax.-
“For taxable years beginning after December 31, 2001, the credit determined under this subsection for the taxable year shall be reduced by the excess (if any) of--
“(A) the amount of tax imposed by section 55 (relating to alternative minimum tax) with respect to such taxpayer for such taxable year, over
(B)” the amount of the reduction under section 32(h) with respect to such taxpayer for such taxable year.”
1999 - Subsec. (d)(2). Pub. L. 106-170, Sec. 501(b)(1), amended par. (2) by substituting “2001” for “1998”.
1998 - Subsec. (d)(2). Pub. L. 105-277, Sec. 2001(b), amended par. (2) by substituting “For taxable years beginning after December 31, 1998, the credit” for “The credit”.
Subsec. (d)(3)-(4). Pub. L. 105-206, Sec. 6003(a)(1), amended subsec. (d) by striking pars. (3) and (4). Prior to being stricken, they read as follows:
“(3) Limitation.--
The limitation under this paragraph for any taxable year is the limitation under section 26 (without regard to this subsection)--
“(A) increased by the taxpayer's social security taxes for such taxable year, and
“(B) reduced by the sum of--
“(i) the credits allowed under this part other than under subpart C or this section, and
“(ii) the credit allowed under section 32 without regard to subsection (m) thereof.
“(4) Unused credit to be refundable.--
If the amount of the credit under paragraph (1)(B) exceeds the amount of the credit under paragraph (1)(A), such excess shall be treated as a credit to which subpart C applies. The rule of section 32(h) shall apply to such excess.”
Subsec. (d)(1)-(2). Pub. L. 105-206, Sec. 6003(a)(1), amended pars. (1) and (2). Prior to amendment they read as follows:
“(1) In general.--
In the case of a taxpayer with 3 or more qualifying children for any taxable year, the amount of the credit allowed under this section shall be equal to the greater of--
“(A) the amount of the credit allowed under this section (without regard to this subsection and after application of the limitation under section 26), or
“(B) the alternative credit amount determined under paragraph (2).
“(2) Alternative credit amount.--
For purposes of this subsection, the alternative credit amount is the amount of the credit which would be allowed under this section if the limitation under paragraph (3) were applied in lieu of the limitation under section 26.”
Subsec. (d)(5). Pub. L. 105-206, Sec. 6003(a)(1), redesignated par. (5) as par. (3).
Subsec. (d)(3). Pub. L. 105-206, Sec. 6003(a)(2), amended par. 3 (as redesignated by Pub. L. 105-206, Sec. 6003(a)(1)) by substituting “paragraph (1)” for “paragraph (3)”.
EFFECTIVE DATE OF 2018 AMENDMENTS
Amendment by Pub. L. 115-141, Div. U, Sec. 101(i)(1), effective as if included in the provision of Protecting Americans from Tax Hikes Act of 2015 [Pub. L. 114-113, Div. Q, Sec. 205] to which it relates [effective for any return of tax, and any amendment or supplement to any return of tax, which is filed after Dec. 18, 2015].
Amendment by Pub. L. 115-141, Div. U, Sec. 401(a)(3), effective March 23, 2018.
EFFECTIVE DATE OF 2017 AMENDMENTS
Amendment by Pub. L. 115-97, Sec. 11022(a), effective for taxable years beginning after December 31, 2017.
EFFECTIVE DATE OF 2015 AMENDMENTS
Amendments by Pub. L. 114-113, Div. Q, Sec. 101, effective for taxable years beginning after the date of the enactment of this Act [Enacted: Dec. 18, 2015].
Amendments by Pub. L. 114-113, Div. Q, Sec. 205, as amended by Pub. L. 115-141, Div. U, Sec. 101(i)(2), effective for any return of tax, and any amendment or supplement to any return of tax, which is filed after the date of the enactment of this Act [Enacted: Dec. 18, 2015].
Amendments by Pub. L. 114-113, Div. Q, Sec. 208, effective for taxable years beginning after December 31, 2015.
Amendment by Pub. L. 114-27, Sec. 807(a), effective for taxable years beginning after December 31, 2014.
EFFECTIVE DATE OF 2014 AMENDMENTS
Amendment by Pub. L. 113-295, Div. A, Sec. 209(a), effective as if included in the provision of the American Recovery and Reinvestment Tax Act of 2009 [Pub. L. 111-5, Sec. 1003] to which it relates [Effective Date: Taxable years beginning after Dec. 31, 2008].
EFFECTIVE DATE OF 2013 AMENDMENTS
Amendments by Sec. 103(b) of Pub. L. 112-240 effective for taxable years beginning after December 31, 2012.
Amendments by Sec. 104(c)(2) of Pub. L. 112-240 effective for taxable years beginning after December 31, 2011.
EFFECTIVE DATE OF 2010 AMENDMENTS
Amendments by Sec. 103(b) of Pub. L. 111-312 effective for taxable years beginning after December 31, 2010.
Amendment by Sec. 10909 of Pub. L. 111-148 effective for taxable years beginning after December 31, 2009. Pub. L. 111-148, Sec. 10909(c), as amended by Pub. L. 111-312, Sec. 101(b)(1), provided that:
“(c) Sunset Provision.—Each provision of law amended by this section is amended to read as such provision would read if this section had never been enacted. The amendments made by the preceding sentence shall apply to taxable years beginning after December 31, 2011.”
EFFECTIVE DATE OF 2009 AMENDMENTS
Amendment by Section 1003(a) of Pub. L. 111-5, Div. B, effective for taxable years beginning after December 31, 2008.
Amendment by Section 1004(b)(1) of Pub. L. 111-5, Div. B, effective for taxable years beginning after December 31, 2008. Section 1004(e) of Pub. L. 111-5 provided that:
“(e) APPLICATION OF EGTRRA SUNSET.—The amendment made by subsection (b)(1) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] in the same manner as the provision of such Act to which such amendment relates.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
Amendment by Section 1142(b)(1)(A) of Pub. L. 111-5, Div. B, effective for vehicles acquired after the date of the enactment of this Act [Enacted: Feb. 17, 2009]. Section 1142(e) of Pub. L. 111-5 provided that:
“(e) APPLICATION OF EGTRRA SUNSET.—The amendment made by subsection (b)(1)(A) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] in the same manner as the provision of such Act to which such amendment relates.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
Amendment by Section 1144(b)(1)(A) of Pub. L. 111-5, Div. B, effective for taxable years beginning after December 31, 2008. Section 1144(d) of Pub. L. 111-5 provided that:
“(d) APPLICATION OF EGTRRA SUNSET.—The amendment made by subsection (b)(1)(A) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] in the same manner as the provision of such Act to which such amendment relates. Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
EFFECTIVE DATE OF 2008 AMENDMENTS
Amendment by Section 501(c)(1) of Pub. L. 110-351 effective for taxable years beginning after December 31, 2008.
Amendment by Section 106(e)(2)(B) of Div. B of Pub. L. 110-343 effective for taxable years beginning after December 31, 2007. Pub. L. 110-343, Div. B, Sec. 106(f)(3) provided that:
“(3) APPLICATION OF EGTRRA SUNSET.—The amendments made by subparagraphs (A) and (B) of subsection (e)(2) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] in the same manner as the provisions of such Act to which such amendments relate.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
Amendment by Section 205(d)(1)(A) of Div. B. of Pub. L. 110-343 effective for taxable years beginning after December 31, 2008. Pub. L. 110-343, Div. B, Sec. 205(f) provided that:
“(f) Application of EGTRRA Sunset.—The amendment made by subsection (d)(1)(A) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 in the same manner as the provision of such Act to which such amendment relates.”
Amendment by Section 501(a) of Div. C of Pub. L. 110-343 effective for taxable years beginning after December 31, 2007.
EFFECTIVE DATE OF 2007 AMENDMENTS
Amendments by Section 11(c)(1) of Pub. L. 110-172 effective as if included in the provisions of the Gulf Opportunity Zone Act of 2005 [Pub. L. 109-135, Sec. 402] to which they relate.
EFFECTIVE DATE OF 2005 AMENDMENTS
Amendment by Section 402(i)(3)(B)(ii) effective for taxable years beginning after December 31, 2005 [see Pub. L. 109-135, Sec. 402(m)(3)]. Section 402(i)(3)(H) of Pub. L. 109-135 provided that:
“(H) APPLICATION OF EGTRRA SUNSET.—The amendments made by this paragraph (and each part thereof) shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] in the same manner as the provisions of such Act to which such amendment (or part thereof) relates.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
EFFECTIVE DATE OF 2004 AMENDMENTS
Section 101(e) of Pub. L. 108-311 provided that: “the amendments made by this section shall apply to taxable years beginning after December 31, 2003”.
Section 102(b) of Pub. L. 108-311 provided that: “the amendments made by this section shall apply to taxable years beginning after December 31, 2003”.
Section 104(c)(1) of Pub. L. 108-311 provided that: “the amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2003.”
Section 105 of Pub. L. 108-311 provided that:
“SEC. 105. APPLICATION OF EGTRRA SUNSET TO THIS TITLE.
“Each amendment made by this title shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] to the same extent and in the same manner as the provision of such Act to which such amendment relates.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
Section 208 of Pub. L. 108-311 provided that: “the amendments made by this title shall apply to taxable years beginning after December 31, 2004.”
EFFECTIVE DATE OF 2003 AMENDMENTS
Section 101(c) of Pub. L. 108-27 provided that: “the amendments made by this section shall apply to taxable years beginning after December 31, 2002.”
Section 107 of Pub. L. 108-27 provided that: “Each amendment made by this title shall be subject to title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] to the same effect and in the same manner as the provision of such Act to which such amendment relates.” Note that Pub. L. 112-240, Sec. 101(a)(1), struck Title IX of Pub. L. 107-16 effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012.
EFFECTIVE DATE OF 2002 AMENDMENTS
Section 411(x) of Pub. L. 107-147 provided that: “the amendments made by this section shall take effect as if included in the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16, Sec. 201] to which they relate.”
EFFECTIVE DATE OF 2001 AMENDMENTS
Section 204(f) of Pub. L. 107-90 provided that: “amendments made by this section shall apply to calendar years beginning after December 31, 2001.”
Section 201(e) of Pub. L. 107-16 provided that:
“(1) In general.-Except as provided in paragraph (2), the amendments made by this section shall apply to taxable years beginning after December 31, 2000.
“(2) SUBSECTION (b).--The amendments made by subsection (b) shall apply to taxable years beginning after December 31, 2001.”
Section 202(g) of Pub. L. 107-16 provided that: “the amendments made by this section shall apply to taxable years beginning after December 31, 2001.”
Section 618(d) of Pub. L. 107-16 provided that: “the amendments made by this section shall apply to taxable years beginning after December 31, 2001.”
Note, however, that Pub. L. 107-147, Sec. 601(b)(2), provided that: “The amendments made by sections 201(b), 202(f), and 618(b) of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to taxable years beginning during 2002 and 2003.” Pub. L. 108-311, Sec. 312(b)(2), provided that: “The amendments made by sections 201(b), 202(f), and 618(b) of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to taxable years beginning during 2004 and 2005.”
Section 901 (Sunset of Provisions of Act) of Pub. L. 107-16, as amended by Pub. L. 107-358 and Pub. L. 111-312, and struck by Pub. L. 112-240, Sec. 101(a)(1) (effective for taxable, plan, or limitation years beginning after Dec. 31, 2012, and estates of decedents dying, gifts made, or generation skipping transfers after Dec. 31, 2012), provided that:
“(a) IN GENERAL.--All provisions of, and amendments made by, this Act shall not apply--
“(1) to taxable, plan, or limitation years beginning after December 31, 2012, or
“(2) in the case of title V, to estates of decedents dying, gifts made, or generation skipping transfers, after December 31, 2012.
“(b) APPLICATION OF CERTAIN LAWS.--The Internal Revenue Code of 1986 and the Employee Retirement Income Security Act of 1974 shall be applied and administered to years, estates, gifts, and transfers described in subsection (a) as if the provisions and amendments described in subsection (a) had never been enacted.
“(c) EXCEPTION.-Subsection (a) shall not apply to section 803 (relating to no federal income tax on restitution received by victims of the Nazi regime or their heirs or estates).”
NOTE: Section 10909(c) of Pub. L. 111-148, as amended by Pub. L. 111-312, Sec. 101(b), provided:
“(c) Sunset Provision.—Each provision of law amended by this section is amended to read as such provision would read if this section had never been enacted. The amendments made by the preceding sentence shall apply to taxable years beginning after December 31, 2011.”
EFFECTIVE DATE OF 1999 AMENDMENTS
Section 501(c) of Pub. L. 106-170 provided that: “amendments made by this section shall apply to taxable years beginning after December 31, 1998.”
EFFECTIVE DATE OF 1998 AMENDMENTS
Section 2001(b) of Pub. L. 105-277 provided that: “amendments made by this section shall apply to taxable years beginning after December 31, 1997.”
Section 6024 of Pub. L. 105-206 provided that: “amendments made by this title [Sec. 6003] shall take effect as if included in the provisions of the Taxpayer Relief Act of 1997 to which they relate [Effective Date of Pub. L. 105-34, Sec. 101(a): Taxable years beginning after December 31, 1997].”
EFFECTIVE DATE
Effective for taxable years beginning after December 31, 1997.
SPECIAL RULE FOR DETERMINING EARNED INCOME
Section 504(c) of Pub. L. 115-63 provided:
“(1) IN GENERAL.—In the case of a qualified individual, if the earned income of the taxpayer for the taxable year which includes the applicable date is less than the earned income of the taxpayer for the preceding taxable year, the credits allowed under sections 24(d) and 32 of the Internal Revenue Code of 1986 may, at the election of the taxpayer, be determined by substituting—
“(A) such earned income for the preceding taxable year, for—
“(B) such earned income for the taxable year which includes the applicable date.
“In the case of a resident of Puerto Rico determining the credit allowed under section 24(d)(1)(B)(ii) of such Code, the preceding sentence shall be applied by substituting ‘social security taxes (as defined in section 24(d)(2)(A) of the Internal Revenue Code of 1986)’ for ‘earned income’ each place it appears.
“(2) QUALIFIED INDIVIDUAL.
“For purposes of this subsection—
“(A) IN GENERAL.—The term “qualified individual” means any qualified Hurricane Harvey individual, any qualified Hurricane Irma individual, and any qualified Hurricane Maria individual.
“(B) QUALIFIED HURRICANE HARVEY INDIVIDUAL.—The term “qualified Hurricane Harvey individual” means any individual whose principal place of abode on August 23, 2017, was located—
“(i) in the Hurricane Harvey disaster zone, or
“(ii) in the Hurricane Harvey disaster area (but outside the Hurricane Harvey disaster zone) and such individual was displaced from such principal place of abode by reason of Hurricane Harvey.
“(C) QUALIFIED HURRICANE IRMA INDIVIDUAL.—The term “qualified Hurricane Irma individual” means any individual (other than a qualified Hurricane Harvey individual) whose principal place of abode on September 4, 2017, was located—
“(i) in the Hurricane Irma disaster zone, or
“(ii) in the Hurricane Irma disaster area (but outside the Hurricane Irma disaster zone) and such individual was displaced from such principal place of abode by reason of Hurricane Irma.
“(D) QUALIFIED HURRICANE MARIA INDIVIDUAL.—The term “qualified Hurricane Maria individual” means any individual (other than a qualified Hurricane Harvey individual or a qualified Hurricane Irma individual) whose principal place of abode on September 16, 2017, was located—
“(i) in the Hurricane Maria disaster zone, or
“(ii) in the Hurricane Maria disaster area (but outside the Hurricane Maria disaster zone) and such individual was displaced from such principal place of abode by reason of Hurricane Maria.
“(3) APPLICABLE DATE.—For purposes of this subsection, the term “applicable date” means—
“(A) in the case of a qualified Hurricane Harvey individual, August 23, 2017,
“(B) in the case of a qualified Hurricane Irma individual, September 4, 2017, and
“(C) in the case of a qualified Hurricane Maria individual, September 16, 2017.
“(4) EARNED INCOME.—For purposes of this subsection, the term “earned income” has the meaning given such term under section 32(c) of the Internal Revenue Code of 1986.
“(5) SPECIAL RULES.
“(A) APPLICATION TO JOINT RETURNS.—For purposes of paragraph (1), in the case of a joint return for a taxable year which includes the applicable date—
“(i) such paragraph shall apply if either spouse is a qualified individual, and
“(ii) the earned income of the taxpayer for the preceding taxable year shall be the sum of the earned income of each spouse for such preceding taxable year.
“(B) UNIFORM APPLICATION OF ELECTION.—Any election made under paragraph (1) shall apply with respect to both sections 24(d) and 32, of the Internal Revenue Code of 1986.
“(C) ERRORS TREATED AS MATHEMATICAL ERROR.—For purposes of section 6213 of the Internal Revenue Code of 1986, an incorrect use on a return of earned income pursuant to paragraph (1) shall be treated as a mathematical or clerical error.
“(D) NO EFFECT ON DETERMINATION OF GROSS INCOME, ETC.—Except as otherwise provided in this subsection, the Internal Revenue Code of 1986 shall be applied without regard to any substitution under paragraph (1).”
PENSIONS AND INDIVIDUAL RETIREMENT ARRANGEMENT PROVISIONS OF ECONOMIC GROWTH AND TAX RELIEF RECONCILIATION ACT OF 2001 MADE PERMANENT
Section 811 of Pub. L. 109-280 provided that:
“Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 [Pub. L. 107-16] shall not apply to the provisions of, and amendments made by, subtitles A through F [Sections 601-666] of title VI of such Act (relating to pension and individual retirement arrangement provisions).”
SPECIAL RULE FOR DETERMINING EARNED INCOME
Section 406 of Pub. L. 109-73, before repeal by Pub. L. 109-135, Sec. 201(b)(4) (effective Dec. 21, 2005), provided that:
“(a) IN GENERAL.--In the case of a qualified individual, if the earned income of the taxpayer for the taxable year which includes August 25, 2005, is less than the earned income of the taxpayer for the preceding taxable year, the credits allowed under sections 24(d) and 32 of the Internal Revenue Code of 1986 may, at the election of the taxpayer, be determined by substituting--
“(1) such earned income for the preceding taxable year, for
“(2) such earned income for the taxable year which includes August 25, 2005.
“(b) QUALIFIED INDIVIDUAL.--For purposes of this section, the term “qualified individual” means any individual whose principal place of abode on August 25, 2005, was located--
“(1) in the core disaster area, or
“(2) in the Hurricane Katrina disaster area (but outside the core disaster area) and such individual was displaced from such principal place of abode by reason of Hurricane Katrina.
“(c) EARNED INCOME.--For purposes of this section, the term “earned income” has the meaning given such term under section 32(c) of such Code.
“(d) SPECIAL RULES.--
“(1) APPLICATION TO JOINT RETURNS.--For purpose of subsection (a), in the case of a joint return for a taxable year which includes August 25, 2005--
“(A) such subsection shall apply if either spouse is a qualified individual, and
“(B) the earned income of the taxpayer for the preceding taxable year shall be the sum of the earned income of each spouse for such preceding taxable year.
“(2) UNIFORM APPLICATION OF ELECTION.--Any election made under subsection (a) shall apply with respect to both section 24(d) and section 32 of such Code.
“(3) ERRORS TREATED AS MATHEMATICAL ERROR.--For purposes of section 6213 of such Code, an incorrect use on a return of earned income pursuant to subsection (a) shall be treated as a mathematical or clerical error.
“(4) NO EFFECT ON DETERMINATION OF GROSS INCOME, ETC.--Except as otherwise provided in this section, the Internal Revenue Code of 1986 shall be applied without regard to any substitution under subsection (a).”
REFUNDS DISREGARDED IN THE ADMINISTRATION OF FEDERAL PROGRAMS AND FEDERALLY ASSISTED PROGRAMS.
Section 203 of Pub. L. 107-16 provided that:
“Any payment considered to have been made to any individual by reason of section 24 of the Internal Revenue Code of 1986, as amended by section 201, shall not be taken into account as income and shall not be taken into account as resources for the month of receipt and the following month, for purposes of determining the eligibility of such individual or any other individual for benefits or assistance, or the amount or extent of benefits or assistance, under any Federal program or under any State or local program financed in whole or in part with Federal funds.”