California's 2025 Young Child Tax Credit provides up to $1,189. Learn the income, qualifying-child, CalEITC, zero-income, and filing rules.
The California Young Child Tax Credit, or YCTC, is a refundable state credit for eligible low-income families with a qualifying child younger than six at the end of the tax year. For tax year 2025, it provides up to $1,189 per return and generally phases out as earned income rises.
For 2025, a taxpayer generally must:
The credit is per tax return, not multiplied by the number of young children. Having two qualifying children does not double the maximum YCTC.
YCTC is closely tied to the California Earned Income Tax Credit. A family normally completes FTB 3514 to calculate both credits. CalEITC eligibility considers California earned income, filing status, age, residency, qualifying children, and taxpayer identification requirements.
A taxpayer may receive YCTC and CalEITC on the same return. They are separate refundable credits, so the total can exceed the tax otherwise due. The federal Child Tax Credit and federal Earned Income Tax Credit are also separate calculations.
For 2025, the maximum YCTC is $1,189. The credit begins phasing out when earned income exceeds $27,425 and reaches zero at $32,901. FTB commonly describes eligible families as having earned income of $32,900 or less.
The exact amount should be calculated from the current FTB 3514 instructions or approved software. A simple comparison with the maximum income limit does not determine the credit by itself.
Assume Elena files head of household for 2025, lives in California, has a qualifying four-year-old child, and earns $22,000 of wages. If she otherwise satisfies CalEITC and YCTC rules, she can calculate both credits on FTB 3514. Because her earned income is below the YCTC phaseout threshold, she may qualify for the maximum $1,189 YCTC.
If her earned income were $30,000, she could still be below the final eligibility ceiling, but the YCTC would be reduced. Software or the worksheet determines the exact amount.
Beginning with tax year 2022, a taxpayer can qualify for YCTC with zero or negative earned income even though that taxpayer would not receive CalEITC solely because at least $1 of earned income is absent. The taxpayer must otherwise meet CalEITC and YCTC requirements.
For 2025, wages, salaries, tips, and other employee compensation cannot exceed $35,640, and total net loss cannot exceed $35,640 under this special rule. "Total net loss" can include the full current-year economic losses rather than only the portion currently deductible on the return. For example, a $50,000 stock loss can exceed the YCTC net-loss limit even if only $3,000 is deductible against ordinary income.
The child must satisfy the applicable relationship, age, residency, and joint-return tests, and generally must have a valid Social Security number or other identification accepted under the current California rules. For YCTC, the child must be younger than six at the end of the tax year.
Custody arrangements can create confusion. Only the taxpayer entitled under the credit rules may claim the child. A federal release of a dependency claim does not automatically transfer every California earned-income-related credit.
File a California return and include FTB 3514, California Earned Income Tax Credit. Enter the calculated YCTC on the designated Form 540 or 540 2EZ line. A person with little or no filing requirement may still need to file to receive the refundable credit.
California permits eligible taxpayers to claim YCTC for open prior years by filing or amending returns. The eligibility rules and dollar amounts for that earlier year must be used; current-year limits cannot be substituted.
YCTC is refundable. If a taxpayer has $0 of California tax and qualifies for a $1,189 YCTC, the credit can contribute to a refund. By contrast, the California Nonrefundable Renter's Credit can reduce tax only to zero and cannot create an additional refund by itself.
Refundable does not mean the credit always produces the maximum cash amount. Other return items, offsets, prior debts, withholding, and credits affect the final refund.
Keep Social Security cards or accepted identification, birth records, school or medical residency records, custody documents, W-2s, 1099s, self-employment books, loss documentation, prior returns, and records showing the child's home during the year.
Heath Income Tax helps Santa Maria families check qualifying-child, earned-income, self-employment, loss, and prior-year rules for California credits. Contact our office for return preparation or amendment assistance.
Is YCTC refundable?
Yes. It can create or increase a refund when eligibility requirements are met.
Is the credit $1,189 for each child?
No. For 2025, $1,189 is the maximum per eligible return.
Can I qualify with no job income?
Potentially. For 2022 and later, a special rule allows zero or negative earned income when the taxpayer otherwise qualifies and remains within the wage and net-loss limits.
What age must the child be?
The qualifying child must be under age six at the end of the tax year.
The definitions and examples on this page are for informational purposes only and do not constitute tax advice. Tax laws change frequently and individual circumstances vary. Consult a qualified tax professional before making decisions based on this content.
Click a question or ask us your own.
Ask Us a Question
Message Sent!
Thank you — we'll get back to you as soon as possible.