Child Tax Credit

Posted: Monday, January 26, 2004

WASHINGTON (AP) Gathering up the paperwork to start working on your tax return? Make sure you find last summer's letter from the Internal Revenue Service if your family was among those who got an advance child tax credit payment.

Last summer's checks went to families who, based on their 2002 tax returns, had children under age 17 and were expected to qualify for the child tax credit in 2003. Under normal circumstances, families would have applied for the credit when they filled out their 2003 tax returns in early 2004.

Lawmakers instead decided to send some extra money to qualified families as quickly as possible and instructed the IRS to send checks in late summer. Those checks gave families up to $400 per child. That figure represented the difference between the old and the new maximum credit amount, which rose from $600 to $1,000.

Now, it's time to claim the rest of the credit.

While working through the 2003 tax return, families who qualify for the $1,000 per-child tax credit must reduce it by the amount they received last summer. A family with one child who qualified for the entire $1,000 child tax credit probably received $400 last summer and can claim the remaining $600 when filing a 2003 tax return.

Your tax preparation software or a worksheet in the Form 1040 or Form 1040A instruction booklet will walk you through the calculation.

Families might not qualify for the entire $1,000 credit, depending on their income and tax liability.

All is not lost if you can't find the IRS letter and can't remember how much money you got last summer. The IRS has a form on its Web site that will retrieve the information for you. Select ''Individuals'' on the IRS home page, and then click on ''Your 2003 Advance Child Tax Credit.''

A form will ask you to enter your Social Security number, filing status and the number of exemptions claimed on your return. The result will tell you how much you received last summer.

On the Web:

Your 2003 Advance Child Tax Credit at the IRS - http://www.irs.gov/individuals/article/0,,id111546,00.html



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