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The child tax credit payments authorized in the latest Covid relief law may not ship monthly and may not even begin in July, said IRS Commissioner Charles Rettig.
The $ 1.9 trillion American Rescue Plan signed into law by President Joe Biden on March 11 contained a significant expansion of the child tax credit. Under the law, families will receive an annual benefit of $ 3,000 per child ages 6 to 17 and $ 3,600 per child under 6 for fiscal year 2021.
Payments to families were scheduled to begin in July and were intended to be sent monthly, rather than in a lump sum, as House Democrats proposed. But that might not happen, especially now that the IRS has extended the tax filing season for individuals to May 17 from April 15, Rettig said during a hearing Thursday with the Ways and Means Committee of the Camera.
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That’s because the IRS now has less time to spend implementing and launching a portal for the program, which it must do before July 1, Rettig said.
“I don’t have the resources to dedicate to that portal until the presentation season is over,” Rettig said.
Also, the IRS may not be able to send monthly payments, at least initially, according to Rettig.
To see how much you could expect to receive, personal finance website Grow created a calculator that takes into account your marital status, annual income, and the number of dependents you have.
“It could be a challenge to get it monthly right away,” Rettig said. He noted that on the final invoice, the language was changed to payments sent periodically instead of monthly, giving the agency more flexibility.
“We are focused on trying to get these payments to people in a meaningful way and in a meaningful time frame,” he said.
You must file a tax return to get the child tax credit
Rettig also reiterated that it is important for all individuals and families to file a tax return this year, even if they haven’t done so previously. The IRS needs the return to send tax credit payments to eligible individuals, he said.
Also, filing a 2020 tax return is the only way to claim the stimulus payments for which you were eligible but did not receive.
And people who didn’t file in the past can take advantage of other tax breaks beyond the child tax credit, Rettig said.
The full credit is available to individuals with children and adjusted gross income of less than $ 75,000, or $ 150,000 for a married couple filing jointly. The benefit will begin to be phased out for taxpayers earning the most money and will end for individuals earning $ 95,000 and married couples earning $ 170,000 filing jointly.
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