Question

Olivia is single, 66 years old, and not blind. She paid all the cost of keeping up her home. She earned $55,000 in wages for 2019. Olivia provided all the support for her two grandchildren who lived with her all year. Cora is 11 years old and Jack is 15 years old. She does not have enough deductions to itemize. Olivia, Cora, and Jack are all U.S. citizens with valid Social Security numbers. 2. The maximum amount of child tax credit that Olivia is able to claim per qualifying child for 2019 is:

A. $500 B. $1,000 C. $1,400 D. $2,000

Answer 1

The maximum Child Tax Credit for 2019 is $2000 per child. The credit is subject to an income limitation. The income limit on the Child Tax Credit is based on your modified adjusted gross income (MAGI). If your MAGI amount for 2019 falls between certain dollar limits, your credit is subject to a phaseout (is reduced or eliminated). For tax year 2018, the MAGI phaseout begins at:

• Married filing jointly – $400,000
• Single, head of household, married filing separately or qualifying widow(er) – $200,000

Since the income earned by Olivia is $55000 for 2019 her MAGI will be below the limit of $200,000. Hence, $2000 per child tax credit is available for both Cora and Jack as both are qualifying child for Olivia.