What will a married couple with a taxable income of $85,000 and a tax liability of $1,000 receive as a tax refund from the Child Tax Credit?

To determine the Child Tax Credit refund for a married couple with a taxable income of $85,000 and a tax liability of $1,000, it's important to understand how the Child Tax Credit works.

For the tax year 2023, the Child Tax Credit provides up to $2,000 per qualifying child under the age of 17. This credit can reduce the tax owed dollar-for-dollar and may also be refundable up to $1,600 per qualifying child for taxpayers with a lower income. Given a taxable income of $85,000, it is likely this couple has one or more qualifying children.

Let’s breakdown the potential calculation:

1. If the couple has one qualifying child, they would typically be eligible for a Child Tax Credit of $2,000.

2. However, because their tax liability is only $1,000, they can apply the full credit to reduce their liability to zero, but they will not have any remaining liability to offset.

3. The refundable portion of the Child Tax Credit allows them to receive up to $1,600 back, but they have already used their $1,000 tax liability.

In this scenario, the correct calculation for their situation indicates they would receive a total refund based