Millions of American families are waiting in anticipation for the first monthly $300 payment from the advance child tax credit which will be disbursed on July 15, and continue through the middle of December.
The wording surrounding the child tax credit can be a bit misleading. The child tax credit offered this year, that is 2021, is based off of your 2020 taxes. The child tax credit, in general, has been available for quite some time, but in the past the maximum amount was in the range of $2,000. This year, as part of the American Rescue Plan stimulus relief bill, the Biden administration has extended the credit to be the Extended Child Tax Credit of 2021.
This new credit allows for a $3,600 benefit to be paid not only to taxpayers but all eligible American families who meet the requirements. This means that even if you are unemployed, do not file taxes, or do not make enough money to normally file taxes, you can still receive the full amount without worry.
Over 92% of Americans with children are said to be eligible to receive the full amount of the child tax credit. This means families with children under 6 years of age who make $75,000 or less filing single and $150,000 or less filing jointly.
Here’s where things can get a bit confusing. There has been a significant push from the Biden administration to extend the child tax credit of $3,600 until the end of 2025. As of right now though, this has not been approved, nor has there been any significant movement on it in the past couple of weeks.
The only verified action that has taken place is the extension of the child tax credit for all eligible families regardless of tax-paying status through the end of 2021. The monthly payments that will begin to roll out on July 15 will amount to half ($1,800) of the full benefit amount. The other half will be able to be claimed next year during tax time.
Although the other half will be claimed next year during tax time, it will count towards 2021 taxes. This is how long the child tax credit is currently in place to be in effect. We will update as any further updates are given by the White House.
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Last updated: July 12, 2021