2024 tax season guide for new parents: Child Tax Credit, EITC, Social Security and more

If you recently had or adopted your first child, filing your taxes probably was not a top priority. But even if you're sleep-deprived and haven't left your home in months, you still had to find the time to prepare a return for 2023.

With a new child, your taxes will get more complicated. But the flip side is, you may qualify for a slew of new tax credits and deductions.

Here's what new parents need to know for the 2024 tax season and beyond:

Get a Social Security card for your child

The first order of business is to make sure your child has a Social Security number, said John Karls, a tax partner at Armanino, a national tax advisory firm. "You can't claim your child as a dependent on your tax return if they don't have a Social Security number."

If you don't already have one for your child, you should apply now. But it could take a while for the Social Security Administration to verify your child's birth certificate and identity, so Karls recommends filing for a six-month tax extension while you wait.

More: Residents of this state pay $987,117 in lifetime taxes. Guess which one?

Tax season 2024: Can I claim my parents as dependents? This tax season, more Americans are opting in

Head of household status

If you're a single parent, for tax purposes you're considered the head of the household. That means you could claim a $20,800 standard deduction in 2023, versus a $13,850 standard deduction for single filers without dependents. In 2024, those deductions rise to $21,900 and $14,600.

There are also separate, more favorable tax brackets for heads of households.

Importantly, the IRS won't automatically recognize that you're a single parent and thereby qualify for head-of-household status. You'll have to manually check a box yourself, or inform your tax preparer.

If you're married and cover more than half of your child's expenses, you would also be considered a head of household, but only if you file separately from your spouse.

How much do you get back in taxes for a child?

Generally, people think having a child will automatically lower their tax bill or trigger a larger refund. But in many cases, it depends on your income. Lower-income taxpayers are generally eligible for more generous tax credits and deductions after having or adopting a child, said Jim Daniels, a CPA and managing director at UHY Advisors, a tax and consulting services firm.

Did you become a parent in 2023? You may qualify for more tax credits and deductions
Did you become a parent in 2023? You may qualify for more tax credits and deductions

Adoption tax credit

If you adopted a child in 2023, you might have been able to qualify for a credit of up to $15,950 in adoption-related expenses you incurred per child. This could include adoption-related attorney fees, adoption fees, traveling expenses and more. The credit increased to $16,810 in 2024.

To claim the full credit, your modified adjusted gross income, which is generally close to your adjusted gross income, must be below $239,230. After that, the credit phases out and is not available for people who have a modified gross adjusted income of $279,230. For 2024, those figures rise to $252,150 and $292,150.

The credit is not refundable, meaning if you don't owe any taxes, you won't be able to claim the credit. However, you can carry it forward to reduce your tax liability in the future.

How much is the Child Tax Credit this year? What are the qualifications?

If you became a parent in 2023, you could qualify for the Child Tax Credit if you had an adjusted gross income of less than $200,000 or less than $400,000 if you were filing a joint return with a spouse.

Child and dependent care credit income limit

If you are employed and pay for child care services, you may qualify for the Child and Dependent Care Tax Credit. To qualify, you must have earned income in 2023 and have work-related care expenses, among other rules. You can seek the credit for up to $3,000 of expenses for one child, $6,000 for two or more children. The actual credit is a percentage of those expenses. See IRS Publication 503 for the formulas.

EITC qualifications

Having a child could make you eligible for the Earned Income Tax Credit. If you have one child and your adjusted gross income was $46,560 (filing alone) or $53,120 (filing jointly with a spouse) in 2023, you could claim up to $3,995 in a refundable tax credit.

In 2024, using the same example, the income levels rise to $49,084 and $56,004, and the credit ranges up to $4,213.

Make adjustments to your W-4 withholding

Finally, if you haven't already, you should make sure to fill out a new W-4 form if you have an employer, to reflect that you now have a dependent. This will likely lower the refund you get next year, but it will increase the size of your paychecks going forward, Daniels said, because less money will be withheld.

More of your 2024 tax season questions answered

New Federal tax brackets for 2023-2024. What does it mean for you?

Flush with new funding, the IRS zeroes in on the taxes of uber-wealthy Americans

Your single largest payday may be a 2023 tax filing away. File early to get a refund sooner

Is it better to pay someone to do your taxes or do them yourself? We'll help you decide.

IRS delays 1099-K rules for ticket sales, announces new $5,000 threshold for 2024

IRS to offer pandemic-related relief on some penalties to nearly 5 million taxpayers

Driving for work will pay more next year after IRS boosts 2024 mileage rate

What is OASDI tax on my paycheck? Here's why you and your employer pay this federal tax.

A 30% national sales tax? Abolishing the IRS? Here's what the FairTax Act of 2023 would do

These 8 states don’t have an income tax. Does yours make the list?

What is net pay? How it works, how to calculate it and its difference from gross pay

Daniel de Visé covers personal finance for USA TODAY.

This article originally appeared on USA TODAY: Child Tax Credit 2024: An easy guide to your credit for dependents

Advertisement