What the Expanded Child Tax Credit Means for Lubbock Families
If you have children, you are probably familiar with the child tax credit. This saves you hundreds if not thousands of dollars every year when you file your taxes. In the 2021 tax year, you will likely save even more money thanks to the recently passed legislation.
the American Rescue Act passed in March 2021 did more than provide stimulus payments of $ 1,400 and extend unemployment benefits to the tune of an additional $ 300 per week. It also expanded the child tax credit for the 2021 tax year. This year, the child tax credit went from $ 2,000 per child to $ 3,000 per child over age 6 and at $ 3,600 per child under 6 years old.
the extended tax credit also gives families the option of receiving it in the form of monthly installments that would start no earlier than July 2021 and end in December 2021.
This means that a family with two children under the age of 6 would be eligible for a monthly payment of $ 600. A family with four children under the age of 6 would theoretically be eligible for a monthly payment of $ 1,200.
The extended tax credit is starting to be phased out for single filers earning over $ 75,000 per year and joint filers earning over $ 150,000. It does not apply until 2021.
It should be noted that a person’s eligibility for the Expanded Tax Credit is not based on the number of children they have in 2020, but on the number of children they will have by. December 31, 2021.
In other words, you can consider the expanded tax credit if you receive it as a monthly down payment as an advance on 50% of the tax credit you will claim when filing your 2021 taxes in. 2022.
To calculate what your extended child tax credit might be, visit this website.