As our country and city continue to recover from the economic stress caused by COVID-19, a historic expansion of the American Rescue Plan is set to go into effect July 15th. The expansion, passed in March under President Joe Biden, is the Child Tax Credit. This tax credit is aimed to provide financial relief to families with children under 18 years old. It is our hope that this support will allow children to return to a level of normalcy through sports, after-school, and enrichment programs in New York City without negatively impacting family financial stability.
Before we get into the nitty-gritty and attempt to simplify the US tax system, it is important to note if you’ve filed tax returns for 2019 or 2020, or if you signed up to receive a stimulus check from the IRS, you will get this tax relief automatically and will not need to sign up or take any action!
Please note, Kids in the Game is not an accounting firm, but this is valuable information we want to share with our families and community.
The Child Tax Credit allows for increased monthly payments up to $300/month per child starting July 15th. Families will receive 50% of their eligible total ($3,600 total for children under 6 years old and $3,000 total for children between 6 and 18) in monthly payments and the remaining 50% when families file their 2021 taxes.
So what does that actually look like? See below for some examples!
If you have one 5-year-old child you are eligible for $3,600. You will receive $1,800 total in monthly payments from July to December — $300 per month. The remaining $1,800 will be distributed in your 2021 tax filing.
If you have one 7-year-old and one 12-year-old you are eligible for $6,000 ($3,000 per child). You will receive $3,000 total in monthly payments from July to December — $500 per month. The remaining $3,000 will be distributed in your 2021 tax filing.
The following income levels (adjusted gross income) are the thresholds to receive the maximum Child Tax Credit.
To qualify for the child tax credit advance monthly payments, you (and your spouse if you file a joint tax return) must have:
It’s important to note, the Child Tax Credit is only in effect for 2021, however, President Biden is strongly advocating for the extension of the new Child Tax Credit in his proposal of the American Families Plan.
For more information, please see the following links below:
FACT SHEET: Biden-Harris Administration Announces Child Tax Credit Awareness Day and Releases Guidance for Unprecedented American Rescue Plan Investments to Support Parents and Healthy Child Development
There are a few ways you can spend your tax credit at Kids in the Game. We have Fall Sports Programs set to launch for basketball, track & field, and soccer. You can also secure your spot for Summer Camp 2022 before this funding is set to expire at the end of this year. If you’re interested in either of these options, fill out the form below and we will reach out directly to you with details and registration information.
Form for mobile users: click here!