Stimulus check update: Child tax credit up to $300 a month coming July 15, IRS announces
The first monthly payment of the expanded child tax credit from the $1.9 trillion coronavirus relief bill will arrive on July 15, the Internal Revenue Service and the U.S. Treasury Department said Monday.
Subsequent payments will be made on the 15th of every month through the end of 2021, unless the date falls on a weekend or holiday, they said.
The funds, which are part of the American Rescue Plan, will give up to $300 per month for each child under age 6 and up to $250 per month for each child age 6 to 17. The maximum Child Tax Credit (CTC) is up to $3,600 for children under the age of 6 and up to $3,000 per child for children between ages 6 and 17 for those who are eligible. When the monthly payments end, the rest of the credit can be claimed on your 2021 tax return.
“With today’s announcement, about 90% of families with children will get this new tax relief automatically, starting in July,” President Joe Biden said in a statement. “While the American Rescue Plan provides for this vital tax relief to hard working families for this year, Congress must pass the American Families Plan to ensure that working families will be able to count on this relief for years to come.”
“For working families with children, this tax cut sends a clear message: help is here,” Biden said.
The IRS said the payments will lift more than five million children out of poverty this year, cutting child poverty by more than half.
It said households will receive the monthly payments through direct deposit, paper check or debit card, and most people won’t have to do anything further to get the payments.
But, it said, it will continue outreach efforts to make sure other families know they are eligible and to make sure it has their payment information.
Singles with adjusted gross income of up to $75,000 will get the full amount, as will married couples filing jointly who earn up to $150,000.
The credit will then phase out, going down by $50 for every additional $1,000 of income.
Those who are not eligible for the higher amounts can still claim $2,000 per child — the previous amount available — as long as adjusted gross income is below $200,000 for singles and $400,000 for those married filing joint returns.
The credit is also fully refundable, which means parents would get the money even if they don’t have any income. The credit previously required parents to earn at least $2,500 a year to be eligible.
Since March 12, the IRS has distributed approximately 165 million individual stimulus payments worth about $388 billion.