Parenting is expensive and Ohio is taking steps to assist families with young children. In introducing his proposed budget for the 2025 tax year, Governor Mike DeWine suggested a $1,000 Child Tax Credit (CTC) to ease the financial burden on families and provide direct support for childcare, education, and basic needs. The Ohio CTC is expected to benefit thousands of households, allowing parents to have the resources needed to care for their children’s well-being.
In this article, we’ll cover everything you need to know about the credit, including eligibility, income thresholds, how to apply, and how families can use the funds.
Overview of Ohio’s $1,000 Child Tax Credit
The recommended Ohio Child Tax Credit aims to assist families with young children by providing them with the means to afford childcare, education, healthcare, and other basic expenses. If passed, it will assist low- and middle-income households in the state with much-needed economic relief. As with all proposals, it is currently under consideration, and as such, it is necessary for families to stay informed and prepare for any eventual tax filings to take full advantage of any potential benefits.
Understanding the Ohio Child Tax Credit
The Child Tax Credit (CTC) is a financial incentive to help families lower their tax liability or increase their refund. The proposed Motion Child Tax Credit may be up to $1,000 per qualifying child under the age of seven for the 2025 Ohio Tax Credit.
In contrast to the federal Child Tax Credit, which is available for children under 17 years old, Ohio’s is aimed at families with younger children in recognition of the high costs associated with early childhood development, childcare, and medical expenses.
It is important to note that this credit is non-refundable, meaning it can reduce a taxpayer’s liability to zero but won’t provide a refund beyond what is owed in taxes.
Who Qualifies for the $1,000 Ohio Child Tax Credit?
To determine whether your family is eligible, consider the following requirements:
1. Age Requirement
- The child must be under seven years old by the end of the tax year.
- If your child turns seven on or after January 1, 2026, they will still be eligible for the credit for the 2025 tax year.
2. Income Limits
- Minimum Income: You must earn at least $2,500 to qualify for a portion of the credit.
- Full Credit Eligibility:
- Single filers: Earn at least $22,500
- Married filing jointly: Earn at least $30,000
- Phase-Out Threshold:
- Single filers: Credit reduces if income exceeds $69,000
- Married filing jointly: Credit reduces if income exceeds $94,000
- For every $1,000 earned beyond these limits, the credit amount is reduced by $50.
3. Residency Requirement
- The child must have lived with the taxpayer for more than half of the tax year.
- Temporary absences, such as vacations, school, or medical care, do not affect eligibility.
4. Dependency Requirement
- The child must be claimed as a dependent on the taxpayer’s tax return.
- The child cannot provide more than half of their own financial support during the tax year.
5. Citizenship Requirement
- The child must be a U.S. citizen, U.S. national, or U.S. resident alien.
- How Can Families Use the $1,000 Child Tax Credit?
The Ohio Child Tax Credit is flexible, allowing families to use the funds as needed. Common expenses include:
1. Childcare Costs Daycare, babysitters, or after-school programs.
2. Education Expenses School supplies, books, and tuition.
3. Medical and Healthcare Needs Doctor visits, vaccinations, prescriptions, and dental care.
4. Household Essentials Groceries, rent, utilities, or transportation.
Since there are no strict limitations, parents can decide how best to use the funds based on their family’s unique needs.
How to Claim Ohio’s $1,000 Child Tax Credit in 2025
1. File Your Ohio State Tax Return
The credit will be available when filing your Ohio state tax return for the 2025 tax year.
2. Include Your Child as a Dependent
Ensure that you claim your child under age seven as a dependent on your tax return.
3. Meet the Income Requirements
The tax system will automatically calculate the credit amount based on your reported income.
4. Submit Supporting Documentation (If Required)
An inquiry about proving residency, income, or other qualifications may arise at some point from the Ohio Department of Taxation.
Current Status: Is the Credit Approved?
The Ohio Child Tax Credit remains a proposal as of March 2025. The Ohio Child Tax Credit was a proposal from Governor Mike DeWine but would require approval from the Ohio legislature to become law.
We expect consideration of the funding in a future budget discussion. If approved, the benefit would apply for the 2025 tax year and would be claimed by families in early 2026.
Final Thoughts
Ohio’s planned $1,000 tax credit for children has the potential to assist families with young children. If the legislation is passed, parents will receive assistance with everyday expenses such as childcare, education, and healthcare, easing the financial pressure of raising a child. Families should follow the legislation’s process and prepare to claim the tax credit on their 2025 Ohio state income tax return if they qualify for it. If you think you qualify, call your tax professional or the Ohio Department of Taxation for the most up-to-date information.
FAQs
1. What is Ohio’s $1,000 Child Tax Credit for 2025?
Ohio is introducing a $1,000 Child Tax Credit to provide financial relief to eligible families with children. This credit can help reduce tax liabilities or result in a refund.
2. Who is eligible for the $1,000 Child Tax Credit?
Eligibility depends on household income, number of dependents, and filing status. Families must meet specific income thresholds and have qualifying children under a certain age.
3. What is the income limit to qualify for the credit?
Income limits vary based on tax filing status. Families earning below a certain threshold may qualify for the full credit, while those with higher incomes may receive a reduced amount.
4. How do I claim the $1,000 Child Tax Credit in Ohio?
You can claim the credit when filing your 2025 Ohio state tax return. Be sure to include necessary documentation, such as proof of income and dependent status.
5. Can I receive this credit if I don’t owe state taxes?
It depends on whether the credit is refundable or non-refundable. If it’s refundable, you may receive a refund even if you owe no taxes. If non-refundable, it only reduces your tax liability.