STATEN ISLAND, NY – Beginning this week, the Internal Revenue Service (IRS) will send the first installment of prepayments between $ 250 and $ 300 per month to eligible families under the 2021 Child Tax Credit.
The tax credit was enacted by President Joe Biden as part of the US $ 1.9 trillion bailout, designed to help the United States recover from the coronavirus (COVID-19) pandemic.
About 36 million eligible U.S. families will receive financial relief under the Child Tax Credit, with the first payments sent out on Thursday, July 15.
Families eligible for the child tax credit are expected to receive up to $ 1,800 in payments by the end of the year. The Biden administration extended the tax credit from $ 2,000 per year to $ 3,600 per child.
Families that can claim the maximum amount of the child tax will receive up to $ 300 per child under 6 and up to $ 250 per child 6 to 17, in monthly installments.
American families will receive their expanded child tax credit in two ways. Half will come via advanced monthly payments, starting Thursday and ending in December. The other half will be claimed on the residents’ annual income tax return.
Americans who prefer to receive their entire child tax credit as a lump sum when they file their 2021 taxes can opt out of the advanced monthly payments model through the Child Tax Credit Update Portal which is currently live on the IRS.gov website.
WHO IS ELIGIBLE?
Families eligible for the Child Tax Credit, according to the White House, include:
– Families earning up to $ 150,000 by applying as a couple.
– A parent declaring as head of the family up to $ 112,500.
– A single parent deposit of up to $ 75,000.
Here is the eligibility information for dependents:
– Those who are 17 or younger are eligible.
– The child must be a US citizen with a valid Social Security number.
– The dependent must have lived with you for at least six months of the year. However, according to the IRS, temporary absences of you or the child for special circumstances – such as school, vacation, business, medical care, military service, or detention in a juvenile facility – count as time spent living together.
– A child born before the end of 2021 will also be eligible for up to $ 3,600 for the child tax credit.
Parents with dependents between the ages of 18 and 24 can also claim the child tax credit. However, they will have to wait to file their taxes to receive the money.
Families will receive their benefits automatically, as long as they have already filed an income tax return in 2019 and 2020 and signed up to receive stimulus checks.
The IRS has a “tool for non-filers,” for those who have not deposited or signed to receive the check, in which a person will be asked for basic personal information to determine their eligibility.
Families that earn higher income thresholds will still be able to receive money through the child tax credit. However, there is a limit. For every $ 1,000 a family earns above an income threshold, they receive $ 50 less in payments.