Many parents will be getting a lower refund than they’re used to this tax season due to the Child Tax Credit.
In March 2021, the American Rescue Plan was passed, which increased the Child Tax Credit from $2,000 to $3,000, according to Rochester First. The idea was that the tax credit would get refunds into the hands of parents sooner, but many who got the money early may not have realized it meant a smaller refund come tax season.
The Internal Revenue Service (IRS) started sending letters out in December 2021 saying taxpayers could check their IRS portal to see how much they received, but recently stated those numbers may not be accurate. The IRS now recommends reviewing bank statements to see exact figures.
That puts a lot of pressure on taxpayers- If parents don’t properly account for the Child Tax Credit when filing, there could be big delays in processing their income tax return.
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