In most cases, payments will range from
$300 to $600 for individuals and $600 to
$1200 for joint filers. Taxpayers may
receive $300 for each qualifying child.
Payments could be less, depending on tax
liability and Adjusted Gross Income.
Phase out reduction begins at $75,000 for
single filers and $150,000 for joint
filers.
Examples of how the Economic Stimulus
Act of 2010 may effect taxpayers who are
single, file as head of household and
have children who qualify for the child
tax credit payment:
Head of household with children:
1) Single parent with two children,
wages of $4,000, no federal income tax
liability before child tax credit.
Individual rebate is $300
Qualifying child credit is $600
TOTAL is $900
2) Single parent with two children, no
wages, veterans’ payments of $2,000,
social security benefits of $2,000, no
federal income tax liability before
child tax credit.
Individual rebate is $300
Qualifying child credit is $600
TOTAL is $900
3) Single parent with two children, no
wages, no social security benefits,
veterans’ payments of $4,000, no federal
income tax liability before child tax
credit.
Individual rebate is $300
Qualifying child credit is $600
TOTAL is $900
4) Single parent with two children, no
wages, no social security benefits, no
veterans’ payments, AGI is $20,000,
federal income tax liability before
child tax credit is $195.
Individual rebate is $300
Qualifying child credit is $600
TOTAL is $900
5) Single parent with two children, AGI
is $22,000, federal income tax liability
before child tax credit is $395.
Individual rebate is $395
Qualifying child credit is $600
TOTAL is $995
6) Single parent with two children, AGI is
$60,000, federal income tax liability
before child tax credit exceeds $600.
Individual rebate is $600
Qualifying child credit is $600
TOTAL is $1,200
7) Single parent with two children, AGI is
$90,000, federal income tax liability
before child tax credit exceeds $600.
Individual rebate is $600
Qualifying child credit is $600
Phaseout reduction is ($750)
TOTAL is $450
Qualifying
for
Head
of
Household
For
a
person
to
qualify
for
the
head
of
household
filing
status,
a
qualifying
person
needs
to
live
with
you
in
your
home
for
more
than
half
the
year.
The
rules
for
qualifying
persons
for
HOH
purposes
is
different
than
the
rules
for
dependents.
Only
certain
types
of
relatives
can
be
qualified
for
HOH
-
Child, step child, adopted child,
foster child, brother or sister, or
a descendant of one of these whom
you can claim as a dependent under
the qualifying children rules
-
Same as above but you choose not to
claim as a dependent because you
released the dependent's exemption
to the noncustodial parent
-
A mother or father who can be
claimed as a dependent under the
qualifying relative rules
-
Brother, sister, grandparent, niece,
or nephew whom you can claim as a
dependent under the qualifying
relative rules.
Under the qualifying relative rules,
some dependents do not need to live with
the taxpayer all year. There is no
residency requirement for children,
grandchildren, siblings, and parents.
But, for head of household purposes the
person must live with you for more than
half the year. It is possible that a
person could be your dependent but still
not qualify you for the Head of
Household filing status.
Special Rule for Separated Parents
Married but separated or estranged
taxpayers from their spouse may be able
to file as Head of Household, even
though they are not legally separated or
divorced. Those who meet all five
criteria below may file as HOH instead
of the less favorable married filing
separately status.
-
You filed a separate return.
-
You paid more than half the cost to
keep up your home over the year.
-
Your spouse did not live in your
home during the last 6 months of the
tax year.
-
Your home was the main home of your
child, stepchild, or eligible foster
child for more than half the year.
-
You must be able to claim an
exemption for the child. You meet
this test if you cannot claim the
exemption only because the
noncustodial parent can claim the
child using the rules for children
of divorced or separated parents.
