The majority of working families in the US have found themselves in a pinch lately, and with the economy going all haywire, those with low income are in dire need of help.
That’s where the Child Tax Credit from the American Rescue Plan comes into play, providing the highest amount of relief to those in need in American history, and as of July 15th, they’ll be receiving monthly payments of up to $300 per child.
With this, the government can all but ensure that low-income families will succeed at attaining financial stability one day, and the best part of it all is that you don’t have to take any action to receive this money.
As long as the family makes up to $150k as a couple or $112.5k as a single parent, they can qualify for these benefits, and they’ve grown tremendously over the years.
Up to $3.6k per child
With the Child Tax Credit, the American Rescue Plan has set out to provide American families with the largest child tax credit to date.
Families with children aged 6-17 are entitled to $3k per child whereas those with children under the age of 6 can receive up to $3.6k.
On top of this, any working family in the US can receive the full child tax credit if their combined income makes up $150k or if a single parent makes $112.5k, with the single parent in question being referred to as the Head of Household.
Automatic monthly payments
If you’ve been diligent with your tax return payments for the past couple of years, or if you’ve received a stimulus check from the IRS, you’re already set to receive this tax relief without any action.
There’s no need to sign up or provide proof of being a parent, as all this information was gathered with your previous tax filings or stimulus check application.
With the help of the American Rescue Plan, American families will finally receive their child tax payments on a monthly basis, up to $250/month for every child between the age of 6 and 17 and up to $300 for children aged under 6.
Those who are registered to receive their tax refunds through direct deposits have continued receiving these benefits on the 15th of every month.
Build Back Better
The yearly Child Tax Credit program was proposed to be extended for many years to come by President Joe Biden, who introduced this proposal in his Build Back Better Act.
With this, the American Rescue Plan will continue to provide support for families with children for years to come, allowing for greater percentages of low-income households in the US to begin working towards financial independence and stability in their later years.
This way, poverty, which has been a major issue in the US for many years, will finally begin to subside, and the economy will also begin to recover as eventually, fewer families will have to rely on welfare programs in order to keep food on the table and the lights on.
Easy application process
Even though the program was designed for tax filers, even those who don’t make enough to be required to file their taxes can receive benefits through the program.
The Biden administration worked together with the Code for America nonprofit in order to make the sign-up tool easy to use and optimized for mobile devices.
With this, even if you were eligible for Child Tax Credit payments but failed to sign up on time, you can collect your $3.6k per child by filing your taxes in the coming year.
There’s a common misconception that families with high income can’t qualify for Child Tax Credit benefits, which is categorically untrue, as they’re only entitled to smaller amounts unless their total income is too high above the minimum threshold.
Finally, it’s important to note that if you lost eligibility at any point while receiving benefits, you were required to report this to the IRS, and if you failed to do so, you may be required to return those payments when you’re filing your tax returns next year.
The main concern for most tax filers is whether the Child Tax Credit will impact the other government benefits they’re receiving.
Thankfully, the payments offered by the American Rescue Plan don’t count as income and can’t interfere with any of the financial or other benefits you may be receiving through some other government assistance program.
This way, you can ensure that you’re receiving your SNAP, SSI, or TANF benefits while also making use of the Child Tax Credit throughout the year.
This way, you can focus on the more important things while the government handles the financial burdens your family may be facing at the time.
Keep exploring the opportunities the federal government has to offer and make use of every form of assistance you’re eligible for, as long as you need it.