If you’re looking for tax deductions for children expats, you’ve come to the right place. As a U.S. parent living in Hong Kong, China, or Macau, you want to maximize the Child Tax Credit (CTC) and other family-related benefits without overlooking critical IRS requirements. Below, you’ll find an overview of eligibility guidelines, filing considerations, and practical tips to help you keep more of your hard-earned money.

Understand what qualifies as a dependent

Qualifying children are central to claiming many family tax benefits. To claim dependents on taxes, your child or dependent generally must be:

  • Under the age of 17 (for Child Tax Credit purposes).
  • Living with you for more than half the year.
  • A U.S. citizen with a valid Social Security Number (SSN).

If your children meet these criteria, they may help reduce your U.S. tax bill while you live abroad.

Verify SSN requirements

For your little ones to qualify, they must each have a legitimate SSN. An Individual Taxpayer Identification Number (ITIN) is not sufficient for the Child Tax Credit, especially for 2025. At least one parent must also hold a valid SSN to claim this benefit.

Consider the Child Tax Credit for 2024

For the 2024 tax year, the Child Tax Credit can cut your tax bill by up to $2,000 per qualifying child. However, it is only partially refundable:

  • You can receive up to $1,700 as a refundable amount, called the Additional Child Tax Credit (ACTC).
  • Your refundable portion depends on your earned taxable income reported on your U.S. return.

Keep in mind that if you exclude all your income using the Foreign Earned Income Exclusion (FEIE), you likely won’t qualify for the refundable portion. If FEIE fully negates your taxable income, consider whether using the Foreign Tax Credit (FTC) would be more beneficial to unlock the Child Tax Credit.

Look ahead to the Child Tax Credit for 2025

According to the One Big Beautiful Act (OBBA), 2025 brings an increase in potential benefits:

  • The maximum credit goes up to $2,200 per child.
  • As with 2024, you may receive up to $1,700 in refundable credit.
  • To get the refund, you need $3,000 or more of earned income, not excluded by the FEIE.
  • Phaseouts begin at $200,000 for single filers and $400,000 for married couples filing jointly.

Because the credit phases out gradually, higher earners see a reduced CTC. If you qualify, this credit can be a game changer for your overall tax benefits for expatriate families.

Know the difference between FEIE and FTC

Many American parents abroad transition from the FEIE to the FTC when children enter the picture. This shift can unlock refundable credits:

  1. Foreign Earned Income Exclusion (FEIE): Lets you exclude up to $126,500 of earned income from U.S. taxation but may disqualify you from the refundable portion of the Child Tax Credit.
  2. Foreign Tax Credit (FTC): Allows you to claim a credit for taxes paid to another country. By using the FTC instead of the FEIE, you often retain eligibility for the Additional Child Tax Credit, putting money back into your pocket.

Steps to file from abroad

  1. Gather documents.
  • You will need your child’s SSN, your own SSN, and details of your earned income.
  1. Complete tax forms.
  • Standard paperwork includes Form 1040 and IRS Form 8812 for the Additional Child Tax Credit.
  1. Decide on FEIE vs. FTC.
  • If you want refundable credits, choosing the Foreign Tax Credit could be more beneficial.
  1. Follow special procedures if you’ve missed filing.
  • If behind on returns, consider the IRS Streamlined Procedure to catch up without penalty.
  1. Submit your return.
  • E-file or mail your return before the deadlines to minimize any complications.

If you need more guidelines on overseas requirements, check out dependents and tax filing requirements. Staying compliant matters, but it doesn’t have to be complicated.

Frequently asked questions

Can I claim the CTC if I earn no U.S. taxable income?

You typically need some taxable earned income for the refundable portion of the CTC. If all your income is excluded by FEIE, you may miss out on the rebate. Consider whether the FTC approach makes more sense for you.

What if my child was born abroad and only has an ITIN?

You must obtain an SSN for your child. An ITIN alone will not make the child eligible for the Child Tax Credit in 2025. The process may take time, so start early to avoid missing out on potential refunds.

Can I still claim the Child Tax Credit for 2024 or earlier if I missed filing?

Yes, you may file amended returns up to three years after the original date to claim missed credits. If you also missed FBAR filings, the Streamlined Procedure might help you avoid penalties and recover prior credits.

Where can I learn more?

Your best next stop could be the IRS website for official guidance, or you can explore helpful articles like child tax credit 2024 to dig deeper.

Key takeaways

  • Children must have valid SSNs to unlock the Child Tax Credit.
  • For the 2024 tax year, you can claim up to $2,000 per child, with a refundable amount of up to $1,700 if you have taxing earned income.
  • In 2025, the maximum credit rises to $2,200 per child under OBBA, with $1,700 potentially refundable.
  • Using the Foreign Tax Credit (FTC) often enables expat parents to claim refundable Child Tax Credits that may be lost if using the Foreign Earned Income Exclusion (FEIE).
  • Keep accurate records and file promptly to avoid complications and penalty issues.

If you’re ready to align your family’s finances with U.S. tax regulations or you need help navigating these credits, consider reaching out to a qualified tax professional. The sooner you address your filing strategy, the easier it will be to get the most out of these valuable expat tax deductions for children.