Author: Artem Hihach
The Child Tax Credit provides tax reductions to households with eligible child or children. Even if you don’t regularly submit a tax return, you may be able to claim the credit.
Are You Set To Collect Your Child’s Credit Tax?
In 2022, the Child Tax Credit will revert to the plan provided by the IRS before the American Rescue Plan’s expansion in 2021. The benefit will be up to $2,000 per kid for a singles filing for child’s tax credit. This will either reduce or raise the size of the recipient’s tax bill.
To get the maximum amount, children must be 17 or younger, and the family income cannot exceed $112,500 (single filer) or $150,000 (couple filing jointly). The credit is partly refundable this year, which means that the full $2,000 per kid is only available to households that pay the required tax.Â
Last year, President Biden’s mammoth $1.9 trillion relief package was geared towards offering financial assistance to American families, and the enhanced Child Tax Credit was one of the most successful measures.
The temporary increase increased the total amount available to $3,000/$3,600 per kid, which is more than the previous year’s entitlement.Â
It also make the credit easy for low-income households get an appropriate credit amount. Additionally, the payment mechanism was changed to disburse the first half of the credit as monthly direct payments. This amounted to a direct deposit of $300/month for children under the age of five, and $250 for aged six to seventeen.
Child Tax Credit Eligibility
The Child Tax Credit is available for each qualified child with a social security number. Furthermore, the child for whom you are claiming the credit must be under the age of 17 to be eligible for the benefits program.
The child may be your son, daughter, foster child, brother, sister, stepbrother, stepsister, or descendant of any of these individuals (for example, your grandchild, niece, or nephew). Adopted children who have been placed with you legally are also eligible. Nevertheless, they must have lived with you for more than 6 months within the year.Â
How to Claim This Credit
This program does not require any special filing or application. However, you must submit your taxes following the instructions on Schedule 8812 (Form 1040 or 1040A, Child Tax Credit page.
Using the information provided by you, the IRS will evaluate your eligibility and automatically enroll you for future payments.Â
If you have not filed a tax return and have not yet provided the IRS with your information, you will need to do that to receive the Child Tax Credit.
Conclusion
The American Rescue Plan permanently extended the full Child Tax Credit to the resident of Puerto Rico with one or more eligible offspring. For the first time, low-income families in Puerto Rico and the United States Territories will get this critical financial help to promote their children’s development, health, and educational attainment.
