The child tax credit was first approved in 1997 and has continually helping for the families affording their everyday expenses of raising children. Until now the parents and caretakers could claim when they filed their taxes.
On March 11, 2021 the American Rescue Plan signed into law, makes available to more families and their children and corrects a long-standing issue with the policy.
“Build Back Better” Act
Biden and Democrats in Congress are trying their best to elevate the boost in the policy.
Expansion in Child Tax Credit 2021 to 2022.
1.The eligible credit for more monthly payments will get from July to December and later another half 2022. Where as in the proposal for 2022, the recipient will get the full refund from January to December in 12 instalments.
2.Earlier, married couples who make up $400,000 and single filers who make up to $200,000 were eligible for this scheme. But the government modified the income limit in 2022.
And if the bill gets passed, then the adjusted gross income (AGI) shall be $112,500 for head-of-household filers and $75,000 for single filers and $150,000 for married filing jointly filers will be eligible for the said scheme.
3. When a person filed a tax return the child’s social security number is very essential to getChild Tax Credit as it is earlier to till now advantage. But where under the current proposal for 2022 social security number of a child is not necessary. With this amendment the non-citizens will get benefited for the said scheme.
- Till 2020 for the child tac credit there is a partial refundability of $1400per child recipient was getting. Further benefit to get for taxable person should have at least $2500 as earned income. As of now government quashed theearned income limit in 2021 made the entirely and fully child tax credit refundable. But the under current proposal will make the child tax credit fully refundable permanently as it has based in the condition to it.
As to cut the cost and pressure of the economy these changes may be applicable only for 2022. However other are demanding that the applicability of the ‘Child Tax Credit’ expansion till 2025.