The post National Family Fun Month! appeared first on Arcadian Blog.
]]>
The post National Family Fun Month! appeared first on Arcadian Blog.
]]>The post Child Tax Credit Information appeared first on Arcadian Blog.
]]>Of the course of the last year there has been assistance provided by the government. One of the assistance provided is the child tax credit and the payments started going out on July 15, 2021. The child tax credit is an advancement of your 2021 child tax credit. In other words, it is money that you would have received next year when you file your taxes. The government passed a bill that increased the amount parents received for the child tax credit for 2021. The advance payments are scheduled to be 6 equal payments for 1/2 of the total amount parents are set to receive for the 2021 tax season. Parents can claim the other half when they file taxes in 2022. The payment is for each qualifying child. It is important to know the bill only covers for 2021.
Eligibility:
According to the IRS, "You qualify for advance Child Tax Credit payments if you have a qualifying child. Also, you — or your spouse, if married filing a joint return — must have your main home in one of the 50 states or the District of Columbia for more than half the year. Your main home can be any location where you regularly live. Your main home may be your house, apartment, mobile home, shelter, temporary lodging, or other location and doesn’t need to be the same physical location throughout the taxable year. You don’t need a permanent address to get these payments. If you are temporarily away from your main home because of illness, education, business, vacation, or military service, you are generally treated as living in your main home." It is important to note that this is for children that do not turn 18 before January 1, 2022.
Amount Received:
The amount received each month is dependent on the ages of the children, filing status and income thresholds. Children ages 5 and under by the end of 2021 are set to qualify for a total of a $3600 child tax credit. This means that parents would receive 6 equal payments of half ($1800), which is $300 each month. Children 6 to 17 by the end of 2021 are set to qualify for $3000. Again, parents would receive 6 equal payments ($1500), which $250 each month.
As mentioned, there are some income restrictions that can change the amount received for each qualifying child. The income is based on your adjusted gross income amount for 2019 or 2020. There are two phase outs to reduce the payments received. The first phase out drops the maximum to $2000 per child, the original child tax credit amount. "The Child Tax Credit begins to be reduced to $2,000 per child if your modified AGI [adjusted gross income] in 2021 exceeds:
- $150,000 if married and filing a joint return or if filing as a qualifying widow or widower;
- $112,500 if filing as head of household; or
- $75,000 if you are a single filer or are married and filing a separate return.
The first phaseout reduces the Child Tax Credit by $50 for each $1,000 (or fraction thereof) by which your modified AGI exceeds the income threshold described above that is applicable to you."
The second phase out drops the payment below $2000. "The Child Tax Credit won’t begin to be reduced below $2,000 per child until your modified AGI in 2021 exceeds:
- $400,000 if married and filing a joint return; or
- $200,000 for all other filing statuses.
The second phaseout reduces the Child Tax Credit by $50 for each $1,000 (or fraction thereof) by which your modified AGI exceeds the income threshold described above that is applicable to you."
*** The amount you receive is currently based on your 2019 or 2020 taxes, if your adjusted gross income increases to the levels mentioned above and you have received the advanced payments, you will be required to pay it back!***
Example: If you and your spouse filed a joint return for 2020 with an AGI of $100,000 then you would qualify for the increased advance credit. If this couple accepts the monthly payments and then files their 2021 taxes and their AGI is $175,000- they would OWE the IRS the tax credit back.
Opting Out of the Credit :
There are a few reasons one might choose to opt out of the monthly payments for the child credit. A family might be close to the income restrictions and not want to pay the amount they receive back or maybe you want to save the money for taxes you might owe. No matter the reason, you can choose to opt out of receiving the monthly payments. In order to unenroll, all you need to do is visit the IRS website before each month's deadline. The next payment date is scheduled for August 13, 2021, if you wish to opt prior to receiving this payment you must unenroll by August 2, 2021. The full list is as follows:
| Payment Month | Unenrollment Deadline | Payment Date |
|---|---|---|
| July | 6/28/2021 | 7/15/2021 |
| August | 8/2/2021 | 8/13/2021 |
| September | 8/30/2021 | 9/15/2021 |
| October | 10/4/2021 | 10/15/2021 |
| November | 11/1/2021 | 11/15/2021 |
| December | 11/29/2021 | 12/15/2021 |
You should know that if you choose to unenroll, at this time, you cannot re-enroll. Also, if you have filed jointly both you and the second person must unenroll if you wish to opt out.
Additional Information:
There is additional information available on the IRS website, including a section to determine your eligibility. You can also change your address, marital status, and number of children. If you need to update your bank account information, you can do that as well. Lastly, if you are not required to file your 2019 or 2020 taxes, you can still receive the child tax credit. Click on the section that says "Non-Filers".
Information provided from:
https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021
The post Child Tax Credit Information appeared first on Arcadian Blog.
]]>