My son, born in the US, did not live there long enough to be able to pass
> his American citizenship to his children, born and living
> outside the US. His wife isnot an American either. Now my son will be
> getting US citizenship based on my residence in the US.
>
> Now here is my question -- for 2007 his children will not be US citizens, > and
> thus unable to be counted as dependents. Perhaps by the end of 2008 they > will
> be. Will he be able to file an amended return for 2007 to count them as > dependents?
No. Each tax year stands alone.
Will he be able to claim the child allowance?
Except for adopted children the child must be a US citizen or national or a resident alien.
See the 1040 instructions.