Child credit reductions expected on 2022 tax returns

SALINAS, Calif. (KMUV-TV) - The Internal Revenue Service (IRS) announces that some child credits will change during tax returns for the 2022 tax year.

According to the IRS, the maximum tax credit per qualifying child will be $2,000 for children ages five and younger, or a maximum of $3,000 for children ages six to 17. In addition, a part of the credit cannot be received in advance, like last year.

According to tax experts, the 2021 credit increases were fully refundable. However, the new refund change in 2023 reduced it considerably from $3,600 to just $2,000.

Additionally, according to the tax office, the refundable amount of the child credit in 2023 will be a maximum of $1,500 for dependents who qualify for these credits.

“What taxpayers should know is that for future years there is already talk that this credit will be reduced even more, up to $1,000 per child. So it's super-important to stay informed,” said Tania Santos, a tax professional in Salinas.

Tax preparation experts suggest taxpayers be prepared to see more reductions and plan their finances since the children's credits will not be enough to pay the tax debt.