WASHINGTON, DC – The new $ 1.9 billion stimulus bill has removed its last hurdle and passed the House early Wednesday afternoon.
Along with that comes new tax credits for families that increase the current $ 2,000 child tax credit to $ 3,000 for each child between the ages of 6 and 17. For children under 6, it is $ 3,600 per child. It is expected that the poverty of children will decrease by almost half within one year.
“The expansion will not affect 2020. There is still a $ 2,000 credit available to people for 2020. But what we are talking about now is for 2021,” Bill Bloss told RLB Accountants in Allentown.
With the stimulus package, half of the new credit from July to December can be paid out monthly as an advance on your 2021 tax. The rest of the credit you can claim if you submit for 2021.
“They can file their tax return – in this case April ’22, and get the remaining balance they owe,” Bloss said.
You also no longer have to be employed to claim the credit.
The money is starting to phase out for individuals earning more than $ 75,000 and couples earning $ 150,000, although some Democrats in Congress call it unfair to single parents, as the cost of childcare is the same regardless of marital status.
For now, the tax credit will only apply for 2021, but President Biden and others are already talking about making this provision – and others – permanent.
“We need to be careful, we need to be careful, we need to support those who need help, but we must not overdo it,” said former Republican Congressman Charlie Dent. ‘Just to say we’re going to take provisions that have been enacted in this bill – which we said in emergencies was necessary – and now we’re going to make it permanent. I think it’s a little insulting. ‘
Republican Senator Mitt Romney has his own proposal to do something similar with the child tax credit. That proposal would actually pay off more.
“Some of these provisions may be worth expanding on, but they should be a separate debate on a separate day,” Dent said.
President Biden is expected to sign the bill on Friday.