Raising up a child is not a day journey; as a child grows, money being spent on that child also increases. Hopefully, due to the child tax credit, parents are being provided credit for their children based on their age. Before a child is eligible for the child tax credit, the child has to be under age 17 but with the enhanced child tax credit released this year, a child who is 17 years of age is highly qualified.
The enhanced child tax credit added more benefits as the amount stated before was $2000 but now increased to $3000 for those within the range of 6 – 17 years while children under 6 years are being given a child tax credit worth $3600. This is a great opportunity for those who are on low income. Besides, the current president is on a plan to stretch this enhancement to 2025.
Enhanced Child Tax Credit Explained
This is a great opportunity for so many families, with the enhanced child tax credit as children from 17 years downward would benefit from this. It also tends to make it easy for families who are on low income and kind of difficult for those who are on high income. To check the amount of credit that would be given to you, look for the 2021 child tax credit calculator to help you out.
Due to the changes made in the previous child tax credit, lots of parents would be having the amount of money received would be increased. The opportune arrival of the enhanced child tax credit was perfect based on the fact that we are still recovering from the Covid-19 pandemic that brought down people financially. This is all due to the American Rescue Plan Act of 2021. There are few great changes that were made to this tax credit as will be discussed further.
Children age limit
Unlike before where any 17 years old child is not counted among the qualified children for the child tax credit. Now, based on the recent changes which were influenced by the American Rescue Plan Act of 2021 enhanced the child tax credit of the previous year. With the enhanced child tax credit, children of 17 years are qualified.
Increment in the Credit Amount
This must have brought joy in so many homes as the child tax credit amount has been increased from $2000 to $3000 for children from 6 – 17 years. Moreover, it was increased to $3600 for those children who 6 years old. So, a big congratulations to those who are 17 years. Although, partial credit is being given to those who are dependent but not among the qualified children are to receive $500 which is still constant up till today.
Due to the enhanced child tax credit been a refundable credit contrary to the previous one, taxpayer can now get a refund during tax time if the tax liability is being surpassed. Although not all taxpayer are qualified as you must be a resident in the U.S for at least more than half of the taxable year. If this requirement is not met, then you can’t get a full refund.
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