(CSU) — Families will no longer receive the advanced child tax payments they’ve become accustomed to receiving each month, although some may still be eligible for the benefit under pre-pandemic circumstances.
According to the federal tax department, more than 30 million households will be eligible for payments of up to $300 per month for eligible children aged five and under and $250 for each eligible child aged 6 to 17.
Those adjustments expired in January, and many households did not get their monthly payment for the first time in six months on Friday.
Here are a few things to keep in mind as families adjust to the new eligibility and filing criteria.
WHY DIDN’T I RECEIVE MY CHILD TAX CREDIT PAYMENT ON THE 14TH OF JANUARY?
President Joe Biden’s $1.9 trillion coronavirus relief program, which expired at the start of the new year, included enhanced monthly child tax credit payments. Biden and other Democrats wanted to prolong the payments for another year, but Sen. Joe Manchin, D-W.Va., voted against it in a Senate that was evenly divided. Manchin’s resistance finally stalled Biden’s social spending program, resulting in the monthly payments expiring.
Manchin has offered a 10-year, fully financed version of Biden’s economic plan, which would eliminate the focus on child tax credits and instead support services like universal pre-kindergarten rather than delivering money directly to families.
IS IT STILL POSSIBLE FOR ME TO RECEIVE MONEY?
Maybe – under Biden’s American Rescue Plan, the child tax credit was increased from $2,000 to $3,000 per child in March.
The plan made the credit entirely refundable, allowing the lowest-income taxpayers to get the whole amount, and it also expanded the benefit to cover 17-year-olds. It also permitted the payment of up to 50% of the 2021 credit in advance payments before the filing of last year’s tax returns.
Families will receive the remaining half of their 2021 credit whenever they file their taxes in the future months, as they only receive half of their credit on a monthly basis.
The credit amount will be reduced to $2,000 per child aged 0 to 16 in 2022. Families with enough income to owe taxes will receive full payments, and instead of monthly payments, the credits for 2022 will be issued after people file their taxes at the beginning of the following year.
WHAT DO I DO NOW?
Families who got advance Child Tax Credit payments must file a 2021 tax return and match their 2021 advance Child Tax Credit payments to the amount of Child Tax Credit they can claim appropriately on their 2021 tax return, according to the IRS.
Families who were not eligible for advance payments can claim the Child Tax Credit on their federal tax return in 2021 to get the missed payments as well as the other half of the credit.
This month, the IRS will send letters out detailing the total amount of advance Child Tax Credit payments received by taxpayers in 2021, as well as the number of qualified children utilized to calculate those payments.
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