Getting started!
Getting started!
Getting started!
Getting started!
by Christy Bieber | March 9, 2021
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The $ 1,400 checks are just the beginning of the relief offered by the latest economic bill.
President Joe Biden pledged more coronavirus aid to Americans, and the government is likely to achieve that campaign goal. In fact, the US Senate passed a COVID-19 relief bill over the weekend that will soon reach the president’s desk for signature.
The most widespread piece of legislation is undoubtedly the $ 1,400 stimulus reviews. Eligible adults and loved ones can expect this money soon after the president officially signs the American rescue plan (as the new COVID bill is called).
Those hard hit by the pandemic can learn about the prospect of a direct payment of $ 1,400. For parents, however, that one-time check may not be the most valuable part of the bill. An expanded child tax credit could be a lot more generous – and potentially open the door to long-term help.
The COVID relief bill not only approved a third COVID-19 stimulus payment. Also, the child tax credit has been extended by one year.
Tax credits reduce taxable income from dollar to dollar, so they’re very valuable. There is currently a child tax credit of up to $ 2,000 per eligible child.
However, only $ 1,400 will be refunded and individuals must have earned at least $ 2,500 in income to qualify for a refund . This means lower-income Americans – or those who pay less than $ 2,000 a year in federal taxes – don’t get that much out of it.
This makes the loan far more valuable to many parents than the one-time check for 1,400 USD. After all, $ 3,000 – or $ 3,600 – is a larger amount. And parents can apply for this credit for multiple children who meet the requirements. This includes having the child live with you for at least six months, be classified as a dependent, and have a Social Security number.
While the American bailout plan only extended this loan until the end of the year, many Democrats want this loan to be permanent. This would lift millions of children out of poverty.
It is very likely that Democrats would argue that parents who are used to the money should not be cut off from it. At this point, they will likely go to great lengths to make the loan permanent in later statutes. In other words, the $ 3,000 per child – or $ 3,600 per child – included in this business cycle report can open the door to ongoing payments in your children’s early years.
For most families, this affects way more than that a one-time check for USD 1,400.
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Christy Bieber is a personal finance and legal writer with over a decade of experience. Her work has been shown in major stores such as MSN Money, CNBC and USA Today.
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