Beyond the stimulus checks: all the tax breaks parents and retirees should know about

Under the current stimulus proposal, families with children and seniors may be eligible for new tax breaks that could bring in thousands of dollars more.

Sarah Tew / CNET

If you are or not meet the requirements For him third stimulus control for up to $ 1,400 each, you and your family could still benefit in other meaningful ways if Congress passes the $ 1.9 billion aid bill that’s now with the senate. (Here is the third stimulus check timeline up to now.)

The stimulus proposal, dubbed the American Rescue Plan Act of 2021 (PDF), expand the Child Tax Credit, support affordable early child care, provide money for services for the elderly and disabled, and increase the maximum earned income tax credit for adults, including older workers. While none of these provisions are guaranteed until signed into law, President Joe Biden is expected to expand child and elder care in a future bill, according to The Washington Post.

Here is everything we know now about what the plan includes to benefit parents, children and older adultsand how your family could see thousands of dollars in tax benefits this year. (We have broken all the ways your family I could get more money for stimulus checks time, time, too.)

How much money could my family get for my children, in addition to a new stimulus check?

The American Rescue Plan includes several provisions aimed at reducing child poverty rates in the US, which could provide some families with an additional injection of cash this year. These include:

Stimulus checks for dependents. According to the current invoice, dependent of any age (including children, young adults or older adult relatives) will be eligible for up to $ 1,400 each in stimulus payments. This money will not come in the form of your “own” checkhowever, it will be added to the household total.

Expansion of the Tax Credit for Children. Parents can generally claim a CTC of up to $ 2,000 in their taxes for each child under the age of 17. The American Rescue Plan states that families with children 17 and under would receive a credit of $ 3,000, while those with children under 6 years would receive a credit of $ 3,600. It also makes the credit fully refundable, removing both the dollar limit and the earnings limit that currently prevents many low-income families with children from receiving the full credit, according to the Center for Budget and Policy Priorities. (Read more details about the Child Tax Credit changes here..)

Expanded tax credits for child care. To make child care more affordable for families, the plan provides a child care tax credit for children under the age of 13 – a total of up to $ 4,000 for one child or $ 8,000 for two or more children. The credit would be refundable and available to families earning less than $ 125,000 per year. Those who earn between $ 125,000 and $ 400,000 would receive a partial credit (find out what is your adjusted gross income here). The plan also asks Congress to provide funding to keep child care centers open and improve wages and benefits for child care workers.

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What types of payments or tax exemptions does the plan include for the elderly?

The American Rescue Plan includes funds for programs designed to financially assist older adults. These include:

Stimulus checks for older adults, including dependents. Under the current bill, older adults (including beneficiaries of SSI or SSDI benefits) would be eligible for a third stimulus control of up to $ 1,400, if they are found eligibility requirements. This includes older adults who listed as dependents on someone else’s taxes, even though your share of the stimulus money would be added to the total household amount. (To find out all rules on stimulus controls for older adults.)

Extension of the Earned Income Credit. Designed to benefit the lowest income earners, this tax credit can lower your income and taxable wages. The relief plan proposes to increase this credit for childless adults from approximately $ 530 to $ 1,500 and to increase the income limit for the credit from $ 16,000 to $ 21,000. It would also expand the eligible age range, removing the age limit for older workers. And if your earnings drop in 2021 due to the pandemic, you won’t see your credit reduced. (Find out more about How to claim the Earned Income Tax Credit this year.)

More funding for services for the elderly and disabled. The American Rescue Plan includes additional funds for service programs for the elderly and disabled, but does not elaborate on where exactly that money would go.

For more, find out how a third check could bring more money to your family, Y when the IRS could send the third stimulus check.

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