The Administration for Children and Families(ACF) at the U.S Department of Health and Human Services (HHS) engaged with grantees, families, and community partners to recognize Child Tax Credit (CTC) Awareness Day. Starting July 15 and through the end of the year, most families will receive a monthly payment of $300 per child under 6 and $250 per child ages 6-17. The IRS has launched a simplified online tool that will allow families not automatically enrolled in the program because they did not have to file taxes last year to receive the Child Tax Credit. Families can also visit ChildTaxCredit.gov to learn more about this important benefit.
(Here’s an additional CNBC article about some tax implications families might want to be aware of related to these advance payments of their tax credit.)
Coupled with other investments in the American Rescue Plan, the Child Tax Credit will help cut child poverty in half. The specific impacts to families include:
- All working families will get the full credit if they make up to $150,000 for a couple or $112,500 for a family with a single parent. Families that earn more will get a smaller credit.
- Roughly 39 million households – covering 65 million children (nearly 90% of children in the United States) – will automatically receive the new child tax credit.
- Four in five families who are automatically enrolled will receive their benefit via direct deposit with no additional action required and those who do not have a bank account on file with the IRS will receive their benefit through the mail.
The American Rescue Plan provides access to the new Child Tax Credit in 2021, but families need support beyond just this year. That’s why President Biden proposed an extension in the American Families Plan, which will benefit families for years to come. This simple and straightforward benefit will make an enormous difference to children and families who have been hard-hit by the pandemic by supporting households in meeting their basic needs.