Child Tax Credit: How do I claim the remaining payment and how do I know if I have received it?
The ARP boosted the amount distributed to families through the child tax credit. While monthly payments have ended, the remaining balance can be claimed this tax season.
The American Rescue Plan provided support to millions of households across the US last year and some will continue to see program's benefits after submitting their tax return this spring.
The trillion dollar spending package made significant changes to the amount and disbursement of the child tax credit which helped to cut child poverty rates by forty percent in just six months. The value of the credit increased to $3,600 for children under six and $3,000 for children between six and seventeen. The reformed credit was also made full-refundable and the IRS received a mandate to distribute half the value from July to December 2021.
How long does it take for a tax return to be processed?
The remaining value of the credit can be claimed when families file their taxes.
If you file electronically, which the IRS strongly advises, a tax refund is typically sent within twenty-one days of the agency receiving a tax payer's return. The status of your return can be tracked using the IRS tool Where's my Refund?
For those who did not sign up in time to receive the payments in 2021, you are still eligible and will be able to claim the full value of the credit when submitting your return.
Will the child tax credit be extended?
At this point, it is unlikely that Congress pass an extension to the child tax credit.
The measure had been included in President Biden's Build Back Better agenda, passed by the House of Representatives in November. However, opposition from conservative Democratic Senators like Joe Manchin of West Virginia prevented the bill from coming to the floor for a vote.
"I am having trouble getting it passed again" said President Biden during a speech touting the progress his administration has made with regard to the nation's economic recovery. Since the payments were stopped in December, child poverty rates have already begun to increase. As inflation and prices continue their upward trend, families in the US could see the prices of food, gas, and other essential goods sky rocket in the coming months.
With the war escalating in Ukraine, Congress quietly passed a $1.5 trillion spending bill to fund the government for the coming months. This package also included $13.6 billion in humanitarian and military aid for Ukraine.
Many Democrats had hoped would increase the child tax credit extension. It did not. Supporters of the measure will continue their outreach to politicians as well as communities to ensure all those who were eligible submit a tax return and receive the enhanced credit.