Under the current stimulus proposal, families with children and older adults may be entitled to new tax incentives that can earn thousands of dollars more.
Sarah Tew / CNET
Although you already know President Joe Biden $ 1.9 trillion stimulus plan includes a third stimulus check from to $ 1,400 per eligible person, did you know that there are other ways for your family to get more money from the proposed account? Congress is currently working to approve the American Rescue Plan (PDF). Here’s what’s included: an important expansion to the Child Tax Credit, more access to affordable childcare, money for aging and disability services and an increase in the maximum income tax credit earned for adults, including older workers.
Until a bill is signed by Biden to become law, however, none of these provisions are guaranteed and can be changed at any time. Biden is also expected to include more provisions for child care and the elderly in a future bill, according to The Washington Post.
Here’s everything we know now about what the plan currently includes in terms of benefits for children and older adultsand how your family can get thousands of dollars in tax breaks this year. (We broke all the other ways your family could get more stimulus money this time, too.)
In addition to a third stimulus check, how much more money could my family receive for my children?
The American Rescue Plan includes several provisions designed to reduce child poverty rates in the United States, which could bring some families an extra injection of money this year. These include:
Stimulus checks for dependents. According to the current invoice, dependents 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” check, however, but will be added to the family total.
Expansion of Child Tax Credit. 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 under the age of 17 would receive a credit of $ 3,000, while those with children under 6 years of age would receive a credit of $ 3,600. It also makes credit fully refundable, removing the dollar cap and earnings cap that currently prevents many low-income families with children from receiving full credit, according to the Center on Budget and Policy Priorities. (Read more details about the changes in the child tax credit here.)
Expanded tax credits for daycare centers. To make the daycare more accessible to families, the plan offers a daycare tax credit for children under 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 a year. Those earning between $ 125,000 and $ 400,000 would receive a partial credit (find out what is your adjusted gross income here) The plan also calls on Congress to provide funds to keep daycare centers open and improve daycare salaries and benefits.
See this:
Stimulus check # 3: what you need to know
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What kind of money or tax incentives does the Biden plan include for older adults?
The American Rescue Plan includes funding for programs designed to help the elderly financially as well. These include:
Stimulus checks for older adults, including dependents. Under current law, older adults (including recipients of SSI or SSDI benefits) would be eligible for a third stimulus check in up to $ 1,400, if they meet eligibility requirements. This includes older adults who are listed as dependent on someone else’s taxes, although their share of the stimulus money was added to the total family value. (To discover all rules on stimulus checks for older adults.)
Expansion of Earned Income Tax Credit. Designed to benefit people with lower income, this tax credit can reduce your taxable income and wages. Biden’s plan proposes to increase that credit for childless adults from about $ 530 to $ 1,500, and to increase the credit income limit from $ 16,000 to $ 21,000. It would also expand the eligible age group, removing the age limit for older workers. And if your earnings fall in 2021 due to the pandemic, you won’t see your credit reduced. (Know more about how to claim income tax credit earned this year.)
More funding for aging and disability services. The American Rescue Plan includes additional funds for services programs for the elderly and disabled, but it does not detail where exactly that money would go.
For more, discover how a third check could bring more money to your family, and when the IRS could send the third stimulus, check.