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On July 15, the Biden administration will begin to send out the first payments of it’s Child Tax Credit to eligible families.
It will now provide eligible parents with a $3,000 credit for every child aged six to 17 and $3,600 for every child under age six (up from $2,000 per dependent child up to age 16). Some of that money will come in the form of advance payments, via either direct deposit or paper check, of up to $300 per month through December.
In March, when the American Rescue Plan was signed, the Biden administration included a provision to help end child poverty.
Pandemic penalizes poverty
More than 10 million of the nation’s children lived below the federal poverty line in 2019, according to the U.S. Census Bureau. And the pandemic has made life even harder for those already vulnerable families.
Over the past year, job losses have been especially concentrated among single mothers. And with so many school cafeterias still closed and not feeding kids experiencing food insecurity, researchers are seeing alarming levels of child hunger.
The American Rescue Plan provided for a part of the Child Tax Credit to be sent out in monthly installments from July 2021 until December 2021, rather than as a lump sum to be collected while filing one’s taxes in April 2022.
Majority of U.S. families eligible
Though there will be an additional expense incurred with sending millions of checks to eligible families, the Biden administration’s logic was that given the crisis, many American families could not afford to wait until next April to receive their money. Therefore, half of the payments will be made in advance – a semi ‘stimulus check’ for U.S. families – while the other half will be combined into a more traditional tax rebate and collected in April.
In total, roughly 90% of families in the United States will be eligible for the payments. The government calculates that they will benefit more than 65 million children nationwide and lift 4.1 million of those children out of dire poverty.
To receive the payments, all families are encouraged to file their most recent taxes – taxes which were due on May 17 – in order to make the IRS aware of any changes to each family’s status.