An eligibility assistant allows families to determine whether they qualify for the advance credit by answering a series of questions. Eligible parents will get $300 a month for each child under age 6 and $250 for each one ages 6 to 17 in monthly payments starting July 15 and running through the end of the year.
Another tool lets parents verify their eligibility for the credit and opt out of monthly payments, instead receiving the full credit as a lump sum when they file their tax return next year. In coming weeks, people will be able to view their payment history, change their bank account information and update their mailing address through the tool.
Earlier this month, the IRS unveiled a portal that allows low-income families who don't typically file tax returns to register to receive the enhanced child tax credit. The sign-up tool allows users to provide the necessary information about their households and, if they choose, about their bank accounts so the agency can directly deposit the funds.
The expanded credit, which is only in place for 2021, stems from the Democrats' $1.9 trillion coronavirus rescue package.
Most households don't have to do anything to get it since the IRS already has their 2020 or 2019 returns. Roughly 39 million households, covering 88% of children, will start receiving the monthly payments automatically.
The Biden administration, along with the IRS, are conducting a major push to reach very low-income families, who need to take action. Their participation is crucial to reducing child poverty nearly in half through the credit.
The agency is working with thousands of community-based organizations -- including more than 10,000 new groups that it hadn't interacted with before-- to distribute information about the child tax credit in multiple languages, IRS Commissioner Charles Rettig said in a Senate Finance Committee hearing in early June. It is building on the outreach it conducted since the pandemic began to send three rounds of stimulus payments.
"The stimmies have been fantastic for us in terms of getting into the communities," Rettig said, referring to the stimulus payments.
Sending more money to families for 2021
The enhanced credit gives families up to $3,600 for each child under 6 and $3,000 for each one under age 18. This is up from the existing credit of up to $2,000 per child under age 17. The enhanced credit will be available for single taxpayers with annual incomes up to $75,000, heads of households earning $112,500 and joint filers making up to $150,000 a year.
The relief package also makes the tax credit fully refundable so that more low-income parents can take advantage of it. Until now, it has only been partially refundable -- leaving more than 20 million children unable to get the full credit because their families' incomes are too low.
Lawmakers also wanted to make it easier for parents to use the funds to cover their expenses during the year so they are providing half of the enhanced credit in monthly payments. Families can claim the rest at tax time.
Democrats in Congress have been pushing the Biden administration to make the beefed up credit permanent, but President Joe Biden's American Families Plan would only continue the increased payments through 2025. The plan would make the credit fully refundable permanently.
The provision is projected to cost roughly $110 billion a year.
"claim" - Google News
June 23, 2021 at 04:09AM
https://ift.tt/3zNrWNM
IRS adds tools to help parents claim expanded child tax credit payments - CNN
"claim" - Google News
https://ift.tt/2FrzzOU
https://ift.tt/2VZxqTS
Bagikan Berita Ini
0 Response to "IRS adds tools to help parents claim expanded child tax credit payments - CNN"
Post a Comment