Internal Revenue Services has announced that they have started sending out letters to communicate with more than 36 million American families who may be eligible for the expanded child tax credit. This issue has picked up pace as the payments are said to begin in July this year. The maximum set enhanced credit amount for kids younger than the age of 6 is $3,600 and for the children between 6-17 is $3000 for the year 2021.
Half of the total values will be divided into monthly payments of $300 for children aged below six and $250 for the kids between the ages of 6-17 years. All the remaining amounts will be credited to one’s account after filling up taxes for the year 2021 next year. The eligibility criteria used for sending out announcements are determined from the earlier submitted data records. IRS is also sending letters to the public who have used the non-fillers claims in 2020 for economic impact payments. The American Rescue Plan has also made the child tax credit completely refundable for this year, attracting more families of all income groups to participate in this program.
According to records, almost 80% of the families will get direct deposits, just like previous payments, and others will receive checks in the mail or debit cards to make use of the provided money. Revenue services have also informed that they will allow families to opt-out of the monthly payment scheme and get their funds in one full transaction after filling in taxes the next year. It is also gaining huge traction in the news. The families who have not yet filed their taxation information are also being encouraged to do so and increase their chances of being eligible for the expanded child tax credit. This will enable the IRS to determine the families eligible for such tax benefits in a much more accurate and reliable way. This initiative is one of President Joe Biden’s anti-poverty plans as the US is recovering from the damages dealt due to the coronavirus outbreak. Interestingly, the Biden administration has set $1.9 billion for the American Rescue Plan, in which the child tax credit got increased for millions of American families. The IRS is all set to launch an online portal for families to check their eligibility, update their information, check their payments and, even opt-out of the program if they so desire.