For American families struggling to get by, it appears that more help is on the way starting this summer.
No, it isn’t a fourth round of coronavirus stimulus checks, but instead monthly payments from the new $3,000 child tax credit. According to Internal Revenue Service Commissioner Chuck Rettig, the agency will begin sending out the much-needed payments in July.
The $1.9 trillion American Rescue Plan expanded upon the child tax credit that generally allowed families to claim a credit of up to $2,000 for children under the age of seventeen.
But that particular benefit now has been extended to lower-income families who otherwise wouldn’t receive such a credit. Families are now eligible to claim as much as $3,600 per year for a child under the age of six and up to $3,000 annually for children between six and seventeen.
That means for a family headed by a couple earning less than $150,000 or an individual making under $75,000, they are slated to get a $250 or $300 monthly payment.
In all, a family of four making less than $150,000 could potentially receive more than $14,000 in pandemic relief this year.
“We will launch by July 1 with the absolute best product we are able to put together,” Rettig recently told the Senate Finance Committee.
But he did admit that launching a new program like this can pose unique challenges, stating that “we will not risk our system.”
In order to get their hands on the payment, parents must file a 2020 tax return. Without a return, the IRS will not have the information it needs to deliver the credit.
Know that there is also no limit on the number of children in a family that can receive the credit—as long as they meet the eligibility requirements regarding age and income.
Furthermore, tax credits have been extended for another year to help cover the cost of child care.
Families potentially could get back as a tax credit as much as half of their overall spending on childcare for children under the age of thirteen, up to $4,000 for a single child, and $8,000 for two or more children.
There also have been reports of parents of babies born this year wondering whether their child is included in the third round of stimulus checks.
The good news is that parents who are eligible for the stimulus benefits do, in fact, qualify for the cash. But the bad news is that they will have to wait until they file their income tax returns in 2022 to take advantage of the benefits.
For those who are recently unemployed, they can claim $300 in additional weekly unemployment benefits as well.
Ethen Kim Lieser is a Minneapolis-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.