COLUMBUS (WCMH) — Normally with tax credits, you wait until the following year to claim them on your tax return. But the Child Tax Credit provided under President Joe Biden’s American Rescue Plan is different because you could see cash this year and in 2022.
For single parents making less than $75,000, and married parents earning less than $150,000, the pandemic relief law passed in March increases the Child Tax Credit to $3,600 for every child 5 years of age and under, and $3,000 for every child from 6 to 17 years old — up from the previous cap of $2,000.
That money could appear in the form of $300 a month, or $250 a month, depending on your child’s age.
The IRS said earlier this month that it’s on track to begin sending out the “advance payments” as soon as July, and will continue to distribute them monthly through December of this year.
Then, the second half would come in a lump sum with tax refunds in 2022. Just be sure to file a tax return this year for 2020, claiming your dependents.
If you’re typically a “nonfiler” — you do not file taxes yearly — you will need to file a 2020 tax return to get the credit. This will let the IRS know how many dependents are in the household, who count toward the child tax credit benefits.
The deadline to file your 2020 taxes is May 17. This is a temporary change, and will only be in effect for a year under the Rescue Plan.