Changes To The Child Tax Credit And What It Means For I-10/ITIN Holders

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The House and the President just passed and signed a tax bill that will affect tax filers of all backgrounds, especially ITIN or I-10 filers.The GOP’s tax bill, which was passed in December, doubles the child tax credit from $1,000 to $2,000 per child, and it allows filers to get up to $1,400 as a refund. As it stands, the child tax credit is $1,000 and it’sonly partially refundable. Filers can only claim a percentage of the refund they make that’s over $3,000. This has led to limited benefits for lower-income households.Now, filers will get twice as much of a tax credit for each child they claim next year.Under the previous statute, filers were able to deduct $4,050 for themselves, their spouse, and for each dependent they claimed. For a family of five, this means $20,250 will be protected from federal taxation.The final version of the new law includes a provision that requires filersusing an Individual Taxpayer Identification Number (ITIN) to provide Social Security numbers for each child they claim as dependents. ITINs are primarily used by persons who are not in the country legally.In 2013, 4.4 million ITIN filers claimed child tax credits worth over $6 billion. The newest change is estimated to affect over one million undocumented children. The bill also makes the child tax credit available to higher income individuals due to the fact thatit raises the income threshold to $200,000 for single parents (up from $75,000), and up to $400,000 for married couples (up from $110,000).

What is an ITIN?

An Individual Taxpayer Identification Number (ITIN) is a tax number issued by the IRS. ITINs can be used irregardlessof immigration status. With that being said, they are primarily used by immigrants who are in the United States illegally.Individuals who wish to file an ITIN must have a valid federal income tax return unless they meet certain requirements for an exception. Click here to learn more about the ITIN/ I-10 form.