Did you hear the good news?
If you’re a parent or a single, low-income worker, more historic relief is on its way to your bank account. From July 15 through the end of the year, most families with children under 18 will receive between $250 and $300 per child, per month.
This is because the American Rescue Plan, passed by Democrats in Congress and signed into law by President Biden this past March, helps families by expanding the Child Tax Credit (CTC) for 2021.
Also expanded for 2021 are the Earned Income Tax Credit (EITC), which benefits childless working people with low incomes, and the Child and Dependent Care Tax Credit (CDCTC) for qualifying caretakers with certain dependent care expenses.
Under the expanded CTC, the largest of these benefits, most parents will see monthly deposits in their bank accounts between July 15 and December 15. If you’re a single parent who makes less than $112,000 per year — or you and your spouse make less than $150,000 combined — you’ll get $300 a month per child under 6. For older kids, you’ll get $250.
If you’re better off, you can still qualify for partial benefits. The White House website says payments will go out to all households headed by couples with annual incomes under $400,000, or single parents with incomes less than $200,000.
How do you receive this tax benefit? If you qualify and filed federal income taxes for 2019 and 2020, or if you previously signed up to receive your stimulus check, you don’t need to do anything. Checks will either be mailed to you or directly deposited in your bank account.
If you didn’t earn enough in the last two years to file taxes, you can simply follow the directions posted on the White House website and sign up as a non-filer. You will get half of this extended tax credit monthly this year and the second half of it when you file your 2021 taxes next year.
These payments could be life-changing for millions of people. One analysis projects that the expanded CTC alone will reduce the number of children living in poverty by nearly half.
For these kids, the benefits will follow well into adulthood. According to the advocacy organization Zero to Three, infants and toddlers are the demographic that not only experiences the greatest poverty, but are also most likely to experience lifelong negative consequences from it. Lifting these young children out of poverty now will pay off for their entire lives.
The expanded CTC will also reduce the income disparity between rural families and non-rural families and reduce the racial income gap. Currently two in five babies and toddlers live in low-income households, including three in five in Black families and more than half in Latinx families.
The costs to the present and future of our society from this deep inequality are great. And the benefits in brain development, long-term educational success, and earning potential that will result from these expanded and fully refundable tax credits are critical to a healthy and more equitable society.
The next step is to make these tax credits permanent.
President Biden’s American Families Plan seeks to keep the expansion for everyone extended through 2025 and permanently help these credits reach people who are too poor to file taxes. Another proposal by Rep. Richard Neal (D-MA) would go further, making the expansion of all three credits permanent.
The good news is that for this year, this benefit is on its way. The potentially better news is that the American Families Plan, if it’s passed by Congress, will extend that expansion and achieve a historic reduction in child poverty.
Historic Relief for American Families Is On Its Way to Your Bank Account
Source: Articles Viral Post
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