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As the April 18 tax filing deadline approaches, parents who were eligible for monthly Child Tax Credit payments last year can also expect to receive more generous lump sums. when they complete their declarations.
The U.S. bailout package enacted by Congress temporarily made this credit more generous for 2021.
Since last July, millions of parents have received monthly checks for $300 per child 5 and under, or $250 per month per child 6-17.
These parents will receive the second half of the child tax credit when they file their taxes this year, for a total of $3,600 for children aged 5 and under and $3,000 for those aged 6 to 17. .
However, when asked in a recent survey if they knew they could receive any part of the credit at tax time that they did not receive in the form of monthly payments, 66% of parents said yes. and 34% said no.
The poll was conducted by the Bipartisan Policy Center and Morning Consult in February and included 1,509 parents or guardians of children under 18.
Responses to this question were fairly consistent across gender, age, race and income, according to Andrew Carothers, research analyst at the Bipartisan Policy Center.
“It’s still a pretty big chunk of people who are potentially going to leave money on the table because they don’t know what they’re entitled to,” Carothers said.
Those particularly vulnerable to failure include those who became newly eligible for the child tax credit with temporary changes put in place by Congress last year.
As part of this measure, minimum earnings and income requirements have been removed. The poll found that 28% of respondents said these changes were not well communicated.
The IRS has been working to educate people who will need to file tax returns in order to get the money they might be eligible for.
People who may have missed the $1,400 stimulus checks last year will also have to submit tax returns to claim that money.
The federal government has an opportunity to work with state and local governments and nonprofits to help people access resources and help to claim the credits, Carothers said.
In particular, the loss of monthly Child Tax Credit payments, which expired in December, prompted many parents to cut spending. The top five categories where parents have reduced their spending include food, according to 35% of survey respondents; clothing, 33%; debt repayment, 22%; utilities and telecommunications, 21%; and transportation, 17%.
About a quarter of parents said they hadn’t cut spending in any of the categories surveyed, Carothers said.
However, about two-thirds of respondents said the improved child tax credit for 2021 had a big or somewhat big impact on their family’s finances, he said.
New Hampshire parents and others gather outside the Manchester office of Senator Maggie Hassan on September 14, 2021.
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For this year, the tax credit for children has returned to $2,000 per child and is gradually being established at 15% of income above $2,500. Reimbursements are capped at $1,400 per child.
Those conditions, enacted under the Republican-led Tax Cuts and Jobs Act in 2017, made the child tax credit more generous.
Additionally, the child tax credit has been expanded with the support of all presidential administrations since its enactment, Carothers said.
“There’s a very strong bipartisan legacy with the child tax credit,” Carothers said.
As lawmakers debate future changes, there might be a way to do so through a bipartisan majority, Carothers said.
“This really is an avenue for lasting policy change and to ensure that the future of credit remains as successful as it has been in the past,” Carothers said.
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Some parents may not know about child tax credit money, survey finds – Reuters News in France and abroad