Child Tax Credit: Will Monthly Payments Continue Into 2022?
Families who qualify for the enhanced Child Tax Credit benefits may see their final advanced payments as the program is scheduled to end Dec.15 unless Congress extends it.
But is ending payments a wise decision as the economy continues to struggle?
The credit was given a one-year extension in Biden’s Build Back Better Act. Legislation has already passed the House, but IRS said that it must go through the Senate before the Dec. 28 deadline if families are to receive a mid-January payment, The Wall Street Journal reported.
The enhanced CTC payments were originally included in the American Rescue Plan to help families through the pandemic, as previously reported by GOBankingRates. Advanced monthly payments totaled $300 per child under the age of 6, and $250 per child ages 6 to 17. The benefit for the 2021 year is $3,000, and $3,600 for children under the age of 6.
This credit begins to phase down to $2,000 per child once household income reaches $75,000 for individuals, $112,500 for heads of household and $150,000 for married couples.
These payments were typically paid via tax returns instead of monthly. While challenging for the IRS, Congress can still make retroactive tax-code changes. Lawmakers could instruct the IRS to spread the full credit over 11 months and authorize a double payment for one month or use some other approach, the WSJ added.
However, Sens. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ), whose support will be necessary for Democrats to pass the legislation in the 50-50 Senate, haven’t been swayed to sign the bill. Democrats hoped to extend the CTC for several years, but proposed a one-year plan to reduce the cost of the Build Back Better Plan and to gain Mr. Manchin’s support.
“It’s helped so many children, and I don’t want to see it expire,” said Sen. Catherine Cortez Masto (D., Nev.), as reported by the WSJ.
More From GOBankingRates
- 5 Things Most Americans Don’t Know About Social Security
- 21 Items That Are Always Cheaper at Costco
- Earn Up To $1,500 in Bonuses With This Checking Account
- Should You Refinance Now With the Low Mortgage Rates?