North Carolina Child Deduction

North Carolina Child Deduction (G.S. § 105-153.5(a1))

 

North Carolina's child tax credit was repealed and converted to a new child deduction.  As enacted, a taxpayer who is allowed a federal child tax credit under section 24 of the Internal Revenue Code is allowed to take a deduction for each dependent child for whom the taxpayer is allowed a federal tax credit. Important:  If you do not have a qualifying child as defined under Internal Revenue Code section 24, you cannot claim the child deduction.  For federal tax purposes, a qualifying child is defined as a child under age 17, who meets several othe requirement as specified under the Code. The child deduction expands the number of taxpayers who may benefit from the State tax deduction by increasing the federal adjusted gross income limit for each filing status.  For more information, see Page 12 of Form D-401, North Carolina Individual Income Tax Instructions.

 

Filing Status

Federal Adjusted Gross Income

Deduction Amount Per Qualifying Child

Married, filing jointly/Surviving spouse

Up to $40,000

$2,500.00

Over $40,000

Up to $60,000

$2,000.00

Over $60,000

Up to $80,000

$1,500.00

Over $80,000

Up to $100,000

$1,000.00

Over $100,000

Up to $120,000

$500.00

Over $120,000

$0.00

Head of Household

Up to $30,000

$2,500.00

Over $30,000

Up to $45,000

$2,000.00

Over $45,000

Up to $60,000

$1,500.00

Over $60,000

Up to $75,000

$1,000.00

Over $75,000

Up to $90,000

$500.00

Over $90,000

$0.00

Single/Married, filing separately

Up to $20,000

$2,500.00

Over $20,000

Up to $30,000

$2,000.00

Over $30,000

Up to $40,000

$1,500.00

Over $40,000

Up to $50,000

$1,000.00

Over $50,000

Up to $60,000

$500.00

Over $60,000

$0.00