The monthly tax credit advance begins next month, unless Americans wish to opt out. The IRS says the information is on its way to your mailbox.
Millions of Americans who could be eligible for the monthly child tax credit starting next month are expected to be waiting for a letter in the mail from the Internal Revenue Service in the coming days.
As part of the US bailout signed in March, Americans with eligible children will receive an advance on the child tax credit they normally receive at tax time (it was $ 2,000 for the year d tax 2020, but has been expanded). As of July 15, the monthly payment will be $ 300 for each child under six (or $ 3,600 for the year) and $ 250 for each child aged 6 to 17 (or $ 3,000 for the year). ‘year).
Half of the money will come through monthly payments until December and the other half will come when taxes are filed in 2022. Parents will have the option to opt out of the monthly advance and take it all at tax time. . An online portal for this is expected on July 1 and there will be a Spanish version.
The IRS said it has started sending letters to 36 million U.S. families it has identified as eligible for monthly payments. These people were identified either through their 2019 or 2020 tax returns, or by using the Non-Filers tool last year to get their COVID stimulus checks.
A second personalized letter will notify parents of the estimated amount they will receive per month, the IRS said.
The IRS says eligible families who haven’t filed their 2019 or 2020 returns should do so immediately in order to get payment. This can include homeless people or the rural poor, the agency said.
The maximum child tax credit will be available to people with the following adjusted gross incomes:
- $ 75,000 or less for singles,
- $ 112,500 or less for heads of household, and
- $ 150,000 or less for married couples filing a joint return and eligible widows and widowers.
Why monthly payments versus a lump sum like this has been the case? External analysts believe the payments could cut child poverty in half. The idea is that rather than getting the money all at once, struggling parents can get the money they need for essentials like food, diapers, medicine, and child care. children.
As part of his US plan for families, President Joe Biden is calling for the monthly child tax credit to be extended until 2025. Several Democrats in Congress want it to be permanent.
The Associated Press contributed to this report.