Rhianna and Jay are married filing jointly in 2018. They have six children under age 17 for whom they may claim the child tax credit. Their AGI was $419,400. What amount of child tax credit may they claim on their 2018 tax return?

A) $12,000

B) $11,500

C) $11,000

D) $6,000

The correct answer to the following question is option C) $11,000.

Explanation:

The phaseout limit for married couple filling their return jointly is up to $400,000, but in this case the annual gross income of Rhianna and Jay is $419,400. So their annual gross income is $19,400 ($419,400 - $400,000) more, and then $19,400 / $1000 = $19.4, which is approximately equal to $20.

Now the phase out limit would be $20 x $50

=$1000

For the 6 children, the tax credit wold be - $2000 x $6

= $12,000

From the above amount, the phase out amount will be deducted,

= $12,000 - $1000

= $11,000