Distribution of the Child Tax Credit begins next month for all eligible Americans. We wanted to take a moment to flag this vital monthly payment for you and your business for a handful of reasons.
First, and most obvious, it’s free money to help anyone raising a child. You’ll be hearing a lot about the credit next week, as the White House has announced Child Tax Credit Awareness Day on June 21st. Where typically this money was offered as a tax deduction at the end of the financial year, it’s now being distributed in the form of monthly payments, and substantially expanded - for the current tax year, families will receive $3600 in total for each child under the age of 6, or $3000 for each child between 6 and 17.
Beginning next month, families will be sent a monthly portion of the credit in installments of up to $300, through the end of the year. A handful of specific wrinkles and stipulations apply, so if you’re confused about whether you qualify, don’t hesitate to reach out. That said, this is the most expansive increase of the Child Tax Credit to date. If you filed taxes last year, you don’t have to worry about signing up or qualifying, as everything is automatic.
Which brings us to the second important point - if you didn’t file taxes last year, the IRS has established a helpful online tool to register to receive payments. Those who qualify to use the tool: 1. Did not and do not plan to file a 2020 tax return, and 2. Have a main home in the US for more than half of the year.
Many of our clients’ businesses will have employees who this applies to - part time, low income, non-filers for whatever reason will be able to take advantage of the credit, so it’s important to spread the word.
For more info you can read The New York Times’ thorough breakdown of the new rules and the White House’s own fact sheet. As ever, follow our blog for up to date information and don’t hesitate to reach out to your Harmony partner if you have questions.