Child Tax credit or Earned Income Credit Question?

Last year a friend of mine received over $2000 in additional money after putting his only child as a dependent. Now this year, he is only receiving about $1700 for the same child. He did make about $2500 less in 2006 than in 2005. Is that the reason? Or how does this whole credit work?


Do you get less each year for the same child?

Child Tax credit or Earned Income Credit Question?
Most likely it is from the EIC. The amount is based on your earned income. Here is the IRS EIC chart, which tells you how much EIC you will receive..


http://www.irs.gov/publications/p596/apa...





Now the child tax credit is not as straight forward. It is considered a nonrefundable credit. This means he gets $1000 per child to lower his tax liability. But if all he had is $378 in tax liability than he would only get $378 in a child tax credit. The difference ($622) would now might help get him a refundable additional child tax credit, but he wouldn't get the full $622. That would depend on his income, also.


http://www.irs.gov/publications/p596/apa...
Reply:the child tax credit is only 1000 per child... so, the other grand he got last year was probably from day care and medical and what not odds and ends... so he probably just had lower amounts of other dedutions this year.. but obviously not by much... 500$ will only get you a 100$ difference, so.

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