Tax season can be stressful for parents, especially when you are expecting a refund tied to the child tax credit. The child tax credit, a federal benefit designed to help families offset the costs of raising children, allows you to reduce your tax bill by up to $2,000 for each qualifying child under the age of 17 at the end of the tax year. However, there are nuances in how the credit works—particularly the refundable portion called the additional child tax credit—that can affect when you actually receive your money.

As of April 2025, with Tax Day just a week away, many families are eager to know if claiming the child tax credit will delay their refund. The short answer is: it depends on whether you are claiming the refundable portion of the credit. If you are only claiming the nonrefundable child tax credit (which lowers your tax liability but does not result in a refund if you owe no tax), there is no delay. But if you are eligible for the additional child tax credit—meaning the credit exceeds your tax liability and you get money back—the IRS is required by law to hold refunds until at least February 15 each year. In practice, for those who filed early, refunds typically start being released in late February or early March.

Let us break down the details so you can plan your finances accordingly.

How the Child Tax Credit Works

The child tax credit was significantly expanded under the Tax Cuts and Jobs Act of 2017, which raised the maximum credit from $1,000 to $2,000 per child. This expansion is temporary and is set to expire after the 2025 tax year (meaning it applies to returns filed in 2026). If Congress does not extend it, the credit will revert to $1,000 per child. For the 2024 tax year (returns filed in 2025), the credit remains at $2,000 per qualifying child.

To qualify, the child must be under age 17 at the end of the tax year, must be claimed as a dependent on your tax return, and must have a valid Social Security number. Additionally, the child must have lived with you for more than half the year and must be your son, daughter, stepchild, foster child, sibling, or a descendant of any of these.

The credit is phased out for higher-income taxpayers. For married couples filing jointly, the phaseout begins at adjusted gross income of $400,000. For single filers, it starts at $200,000. The credit is reduced by $50 for each $1,000 of income above these thresholds.

Nonrefundable vs. Refundable: Additional Child Tax Credit

The crucial distinction is between the nonrefundable and refundable parts of the credit. The nonrefundable child tax credit can reduce your tax liability to zero, but any excess is not refunded to you. For example, if you owe $1,500 in taxes and claim a $2,000 credit, you will reduce your tax to $0, but you will not receive the remaining $500 as a refund.

However, if the credit exceeds your tax liability, you may be eligible for the additional child tax credit, which is refundable. This means you can receive up to $1,700 per child as a refund, even if you owe no tax. The $1,700 figure is calculated as the lesser of (a) the unused portion of your child tax credit (up to $2,000 per child) or (b) 15% of your earned income above $2,500, subject to a maximum of $1,700 per child.

Because the additional child tax credit is refundable, it is subject to strict anti-fraud measures. The PATH Act of 2015 requires the IRS to hold refunds that include the earned income tax credit or the additional child tax credit until at least February 15. This delay helps the IRS verify the accuracy of claims and prevent improper payments.

Refund Timing and What to Expect in 2025

For the 2024 tax year, the IRS began accepting returns on January 27, 2025. If you filed early and claimed the additional child tax credit, your refund was held until at least February 15. For most filers using direct deposit, refunds were issued by March 3, 2025, according to the IRS. If you filed later in the season, you should receive your refund within 21 days of the IRS accepting your return, assuming no errors or additional review.

As of now, with Tax Day on April 15, 2025, those who have already filed and claimed the credit should already have their refunds or will receive them shortly. If you have not yet filed, you still have time, and you should not experience any significant delay related specifically to the child tax credit—the February 15 hold has passed. However, filing at the last minute could still result in normal processing delays, especially if you file by paper or if your return requires manual review.

The IRS recommends filing electronically with direct deposit to ensure the fastest refund turnaround. For taxpayers claiming the additional child tax credit, the IRS also reminds that you can track your refund using the “Where’s My Refund?” tool on its website or via the IRS2Go app. The tool updates once daily and shows the status of your refund (received, approved, sent).

History and Future of the Child Tax Credit

The child tax credit has a long history in U.S. tax policy. It was first introduced in 1997 as a $500 per child nonrefundable credit. Over the years, it has been expanded multiple times: to $1,000 in 2003 (by the Jobs and Growth Tax Relief Reconciliation Act), to $2,000 in 2018 (by the Tax Cuts and Jobs Act), and temporarily to $3,600 for children under 6 and $3,000 for older children in 2021 (under the American Rescue Plan). That expansion expired after 2021, and the credit returned to $2,000 for 2022 onward.

Current debates in Congress include calls to make the $2,000 credit permanent or to increase it further. Some lawmakers propose indexing the credit to inflation or expanding it to include younger children. The outcome of these discussions could affect families in future tax years.

In addition to the federal credit, many states now offer their own child tax credits, often modeled after the federal version but with different income limits and refundability rules. For example, New York, California, and Colorado have state-level credits that can provide additional relief. Taxpayers should check their state tax guidelines to see if they qualify.

Common Questions and Tips for Parents

If you are a parent, here are some common questions about the child tax credit and refund delays:

• Will claiming the child tax credit delay my entire refund? No, only the additional child tax credit portion is subject to the February 15 hold. If you are not eligible for the refundable credit, there is no delay.
• What if I have multiple children? You can claim up to $2,000 per child, but the refundable portion is capped at $1,700 per child. The phaseout threshold applies to total claimed credits.
• Can I claim the credit if my child does not have a Social Security number? No, each qualifying child must have a valid Social Security number that is issued before the due date of the return (including extensions).
• What if I owe back taxes or other debts? Your refund may be offset to pay past-due federal taxes, state taxes, or other debts like child support. The IRS will notify you if this occurs.

Finally, remember that the child tax credit is just one of many tax benefits available to families. Others include the dependent care credit, the adoption credit, and the earned income tax credit. To maximize your refund, consider using tax software or consulting a professional to ensure you claim all credits you are eligible for.

For more information on tax season 2025, including tracking your refund and understanding home energy tax credits, stay tuned to updates from the IRS and trusted financial sources.

Source:CNET News