Families with children should file 2020 tax returns to ensure receipt of payments
Beginning in July of 2021, qualifying families with children will begin to receive the expanded federal Child Tax Credit, in part, in the form of monthly checks from the IRS, announced Pisgah Legal Services on May 3.
The total annual credit to be received is $3,600 per qualifying child ages 0-5 and $3,000 per qualifying child ages 6-17 (age on December 31, 2021).
Parents should file a 2020 tax return prior to the May 17, 2021 filing deadline to ensure they receive these monthly payments, even if they are not otherwise required to file a 2020 tax return (because their income is too low to be required to file or other reasons).
By filing 2020 tax returns, parents ensure that the IRS has their current address and number of dependent children. Child Tax Credit payments will be in the amount of $250 or $300 per child per month.
If individuals did not receive the first and/or second stimulus checks, they may be able to receive their payment by filing a 2020 tax return and claiming the Recovery Rebate Credit.
Due to recent changes in the law, families with only one spouse/parent with a valid social security number may now be able to receive the first and/or second stimulus checks as a tax refund by claiming the Recovery Rebate Credit.
For the third stimulus check, qualifying families should receive $1,400 for each taxpayer and $1,400 for each eligible dependent with a valid social security number.
Families with dependents with valid social security numbers can receive the third stimulus check for their qualifying dependents, even if one or both parents do not have a valid social security number. The IRS is still distributing the third stimulus check.
Please refer to https://www.irs.gov/coronavirus/get-my-payment and www.irs.gov for updates.
“The Child Tax Credits have the potential to bring more than 4 million children out of poverty, but families should file their 2020 taxes prior to May 17, 2021 to access these payments as soon as possible,” said Anne Salter, Pisgah Legal’s Earned Income Tax Credit (EITC) Program Director. “We urge everyone to spread the word and for anyone who needs assistance to reach out to PLS.”
A family of four, including two children under age 6, could receive as much as $18,720 between the EITC, the expanded federal Child Tax Credit and the third stimulus check payment.
For more information about child tax credits and stimulus payments, and for free tax filing options, contact Pisgah Legal Services at 828-414-0800 or Stimulus@pisgahlegal.org. For more complex tax issues, including owing back taxes, contact Pisgah Legal Services at 828.253.0406 to apply for legal help.