Millions of families benefited from the advanced child tax credits last year.
This year, the payments are different and when is the deadline?
How have the credits changed?
President Joe Biden signed the American Rescue Act in March 2021. This act expanded the child tax credits to a maximum of $3,600 per child. The credit was distributed on a monthly basis from July 2021- December 2021 as $300 monthly payments. The program aimed to help parents who were struggling financially during the pandemic.
However, this year the advanced credits were not extended. The federal tax credit will revert back to $2,000 per child maximum per year. For the 2022 tax year, parents will get the child tax credit as a single end-of-year tax credit. The money will be used to either reduce the size of the recipient’s tax bill, or increase their tax refund.
In order to be eligible, your children must be 16 or younger and have an adjusted gross income (AGI) no more than $400,000 on a joint return or $200,000 as a single filer or head of household. After exceeding the limit, a $50 decrease would apply for every $1,000 in additional income.
Biden called to extend the advanced child tax credit until 2025, but Congress didn’t pass the measure.
10 states are offering additional child tax payments
Ten states are offering their own credits. However, the amount and eligibility requirements vary by state.
- New Mexico
- New York