As part of the stimulus package signed by President Biden in March, millions of families will begin to receive expanded child tax credit payments today. The IRS is set to begin sending monthly payments to qualifying families through the end of 2021. Families will also receive a tax break in 2022.
Families can receive a total of $3,600 for each child under 6 and up to $3000 for each child ages 6 to 17. Half of the credit will be sent monthly with the remaining benefit able to be claimed on their 2021 tax returns. Families who filed 2019 or 2020 tax returns will automatically receive the monthly credits via direct deposit, paper checks or debit cards.
For low income families who have not filed tax returns, the IRS allows them to sign up via their website to provide necessary information to qualify for the tax credit payments. Experts say the Child Tax credit could cut child poverty in half if those who typically don’t file refunds receive the credit. In addition the poverty rate among Black Americans could be reduced by 38%.
Family advocacy group, ParentsTogether Action conducted a survey of families across the country and 90% of respondents said the monthly payments would be helpful with many using those funds to help pay rent, utilities, food or childcare. The pandemic had an adverse effect on millions of families who found themselves in need of federal assistance.
The Child tax credit is only available in 2021. President Biden proposed an extension of the credit in his American Families Plan. No republican voted for the American Families plan so he is expected to face quite a bit of opposition if he tries to extend the Child Tax Credit.
To find out if you are eligible for the Child tax credit, visit the IRS website.