November 8, 2005 03:37 PM | Permalink |
Current federal tax law provides a credit against taxes otherwise due of up to $1,000 for each child age 16 or under. Not all families are eligible for the full credits, however.
In particular, the $1,000 child tax credit is phased in at lower income levels, in order to deny or limit its benefits to low-income working families. The threshold to begin receiving benefits was set at $10,000 in earnings in 2001, and is adjusted upwards every year for inflation.