WASHINGTON, DC – The new $ 1.9 trillion stimulus project overcame its final hurdle, being approved by the House early Wednesday afternoon.
With it comes new tax credits for families that increase the current child tax credit from $ 2,000 to $ 3,000 for each child aged 6 to 17. For children under 6, it is $ 3,600 per child. The projection is to reduce child poverty by almost half in a single year.
“The expansion will not affect 2020. There is still a $ 2,000 credit available to people in 2020. But what we are talking about now is for 2021,” said Bill Bloss of RLB Accountants in Allentown.
The stimulus package allows half of the new credit to be paid monthly from July to December as an advance on your 2021 taxes. The rest of the credit you can claim when you file for 2021.
“They can file their tax return – in this case, April 22, and get any remaining balance due to them,” said Bloss.
You also no longer need to be employed to claim credit.
Money is starting to decline for individuals who earn more than $ 75,000 and couples who earn $ 150,000, although some Democrats in Congress see this as unfair to single parents, as the costs for children are the same regardless of marital status.
For now, the tax credit will only be valid for 2021, but President Biden and others are already talking about making this provision – and others – permanent.
“We need to be prudent, we need to be careful, we need to support those who need help, but don’t overdo it too,” said former Republican Congressman Charlie Dent. “Just to say that we are going to accept this clause that was enacted in this bill – that we were told was necessary as an emergency – and now we are going to make them permanent. I think this is a little fake. “
Republican Senator Mitt Romney has his own proposal to do something similar with the child tax credit. This proposal would really pay more.
“Some of these provisions may be worth extending, but this should be a separate debate on a separate day,” said Dent.
President Biden is expected to sign the bill on Friday.