States Offering Their Own Child Tax Credit: Minnesota Debuts Big Early Payouts in 2025
With 2025 just one day away, you’re probably thinking hard about how to address your tax issues in the new year. If these plans involve claims federal child tax credityou should also be aware that your state may offer its own version of the credit to help you get more help, especially if you live in Minnesota.
Whether at the state or federal level, the child tax credit can provide parents with a financial lifeline, helping them put money into their pockets for each child every year. While temporarily expanding the federal child tax credit Expected to expire in 2026 (PDF) Unless Congress acts to extend the deadline, parents in a handful of states may also be eligible for additional state credits, although the amounts offered and eligibility requirements vary widely.
The impact of the child tax credit has been considerable even in past years, and a study of the 2021 temporary expansion of the federal credit found it was a significant factor in reducing child poverty. Columbia University Center on Poverty and Social Policy Discover Payments lowers monthly fees The child poverty rate has been reduced by nearly 30%, and subsidies have benefited approximately 61 million children.
Read on to find out if your state offers a child tax credit and if your family may qualify for it. For more information about taxes, learn how to The IRS may be processing payment applications and how New income tax brackets may affect you.
What is the child tax credit?
With the child tax credit, eligible taxpayers can reduce their income taxes based on the number of children they claim as dependents.
The federal credit, first introduced in 1997, currently provides $2,000 per child, of which only $1,600 is refundable, meaning you can receive the amount even if you don’t owe that much tax. The remaining $400 is non-refundable and therefore can only be used to reduce your tax liability.
The current value of the federal credit was determined under the American Rescue Plan Act of 2021, which temporarily extended the credit through December 31, 2025. After this date, if Congress does not make any additional expansions, the credit will revert to its previous amount: $1,000 per dependent child under 16 years of age, non-refundable.
Which states offer the child tax credit?
Regardless of what happens with the federal child tax credit in 2026, parents in the following 16 states can rest assured knowing they may also receive a state-level tax credit: Arizona, California, Colorado, Idaho, Illinois states, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, New York, Oklahoma, Oregon, Utah and Vermont.
However, the specifics of these credits—including their value, refundable amounts, and what counts as a dependent child—will vary by state.
What are the child tax credit advance payment options in Minnesota?
On Tuesday, Minnesota Governor Tim Walz New child tax credit option launched Taxpayers in the North Star State can use a payment method called an “advance payment.” If Minnesota residents who are eligible for the state credit apply for this new option during the 2025 tax season, not only will they receive the full credit for that year as usual (you can find the amount below), but they will also receive an advance of what they would have Credit earned in 2026. Under the new policy, advances for next year’s child tax credit will be paid in increments in the second half of 2025.
“The goal of this nation-leading tax credit is to reduce child poverty and provide tax relief to working-class Minnesota families,” said Walz. “With the prepayment option, we’re making it easier for families to manage annual household expenses. Budget. This new option will increase financial freedom and ensure families have the support they need year-round.”
How much is the child tax credit in each state and who qualifies?
According to the Department of Revenue, the following 16 states offer child tax credits as of October 2024 national conference of state legislatures. Eligibility and amounts vary by state, with 12 states allowing tax refunds, so you can get a refund even if you don’t owe taxes.
Arizona: $100 per dependent child under 17 years of age, non-refundable.
california: $1,117 per qualifying dependent child under age 6, refundable. The full income must be less than $25,000, with a reduced amount available for households earning between $25,000 and $30,931. Must also qualify for the state’s earned income tax credit.
colorado: Refundable up to $3,200 per qualifying dependent under 16 years of age. Exact amount will vary Based on income, tax filing status and age of children.
idaho: $205 per dependent child under 17 years of age, non-refundable.
illinois: A refundable credit equal to 20% of the state earned income tax credit for each dependent child under 12 years of age.
maine: $300 per dependent child under 17 years old, refundable.
Maryland: $500, refundable, for each qualifying dependent child under 17 years of age. However, the child must have a disability and the family’s adjusted gross income must be $6,000 or less to qualify.
Massachusetts: $180 for one dependent child under 12, $360 for two or more, refundable. Credits also apply to adults 65 or older or anyone with a disability.
minnesota: $1,750 per dependent child, refundable, for individual filers earning $29,500 or less, or $35,000 for joint filers.
new jersey: $500 per dependent child under 6 years old, refundable, for taxpayers making less than $30,000 per year. Credit Decrease in $100 increments As income brackets increase, those making between $120,000 and $150,000 are eligible for the minimum credit, which is $100 per dependent.
New Mexico: Refundable between $75 and $175 per dependent child under 17, depending on income level.
New York: For taxpayers, the credit is the greater of: 33 percent of the portion of the federal child tax credit or the federal additional child tax credit that belongs to qualified children, or $100 multiplied by the number of qualifying children. Points are refundable, children must be 16 or under.
Oklahoma: 5% federal child tax credit per household, non-refundable. Does not apply to married couples filing jointly with gross income in excess of $100,000.
oregon: $1,000 per dependent child under 5 years old, refundable. Available only to households earning less than $30,000 per year.
Utah: $1,000 per dependent child ages 1 to 3, non-refundable. The credit is reduced by $10 for every dollar of income above certain thresholds: $27,000 for married filers filing separately, $43,000 for single filers and $54,000 for joint filers.
Vermont: $1,000 per dependent child under 5 years old, refundable, for taxpayers making less than $125,000 per year.
For more, check out CNET’s picks The Best Tax Software You Can Get in 2024.
