(WJHL) – Starting July, some parents could begin to receive $300 checks for next year’s child tax credit.
In previous years, credits would be awarded to parents for each child under the age of 17, at the amount of $2,000 per child. For the next tax season, would be getting $3,000 for children aged 7 to 17, and $3,600 for each child age 6 and younger.
Some details have not been revealed yet. The bill states the following:
“The secretary shall establish a program for making periodic payments to taxpayers which, in the aggregate during any calendar year, equal the annual advance amount determined with respect to such taxpayer for such calendar year.”American Rescue Plan
Incremental tax credit payments will be made in 2021, that means for children age 7 to 17, parents could get monthly checks of $250, and parents of kids age 6 and younger could get $300 each month starting July continuing through December.
Zac Bowen is the father of three young children with one on the way.
The Bowen’s could get $300 per child starting this July and continuing every month through December.
He told News Channel 11 the monthly checks will help.
“With them doing it this way, we’ll be able to make sure everything is perfect, as in, the kids have everything they need, we have everything we need, our bills are paid, I think it’s a good ordeal,” he said.
David Campbell, volunteer tax preparer and Milligan University economics professor, said that to some, the incremental tax credit payments will have an impact on tax refunds in 2022.
“You can go through the year, you get half your child’s tax credits, then you come around to settling up time with the IRS, and the IRS says ‘Ah, we already gave you half your credit, so if you were entitled to $3,600, maybe you already got $1,800 of that, and so somebody’s going “oh, I was expecting more help at tax time.’ So, some people could end up getting a surprise when they recognize that half their credit was already taken in 2021,” Campbell explained.
Also new with the next round of child tax credits, no job requirement, as well as no minimum income.
“I think they can expect higher refunds, and they can expect more help. It’s supposed to help like 50% more, help with the children that are like in a poverty situation or without income,” Libby Marcus, a Kingsport tax preparer said.
Single parents earning more than $75,000, and married couples filing jointly earning $150,000 would be eligible, but those earning more would begin to be phased out.
“The floor amount has changed, it has lowered, so the floor amount has changed but the credit has increased,” Marcus explained.
Campbell explained that for every $1,000 over the threshold, $50 would be deducted for the tax credit.
However, those single parents making under $200,000 and married filers making less than $400,000 would still be eligible for the $2,000 payments.
For now, it seems that additional child tax credit will be temporary, limited only to the 2021 tax season, but some Democratic members of Congress have said they’d like to see it become permanent. Their Republican counterparts have argued that the increased child tax credit could discourage parents from working, and bolster reliance on the welfare state.