There is an $8,000 child tax credit that you could be eligible for when you file your 2021 tax return.
The Child and Dependent Care Credit, which has existed since the 1970s, has been extended through the U.S. Rescue Plan in 2021.
Under the US Rescue Plan, President Biden has worked towards helping parents return to work by extending this particular credit.
As childcare costs continue to soar and as parents are forced to return to the office after Covid, this credit can create an incentive for parents in need.
The expansion can offer up to $8,000, far above the original limit of $2,100. It allows families to claim a credit worth 50% of childcare costs, which means up to $16,000 for two or more children.
This means that families who spent at least $16,000 can get half back from the IRS when they file their 2021 tax returns.
Parents and people with dependents who have paid child care to find work or return to work are eligible. Married couples must file jointly Tax to get credit.
How can I claim the funds?
When you file your tax return, you will need to include Form 2441, Child and Dependent Care Expenses. You will also need eligibility information including a Social Security number.
The IRS recommends keeping records of work-related and childcare expenses.
Any family that doesn’t normally file a tax return should do so, as they may be eligible for an extension child tax credit benefits.
Read ours Child tax credit live blog for the latest news and updates…
The IRS reports several other extended benefits, including a Refund Credit, a Credit for Child and Dependent Care Expenses, and a Earned Income Tax Credit.
These benefits can mean a Tax for many.
Therefore, you should file your tax return electronically. Doing so will speed up the process and possibly get your payback into your bank account sooner.
What is the Child Tax Credit?
The child tax credit was previously set at a maximum of $2,000 per child. However, that amount was increased in 2021 to $3,000 for each child ages 6 to 17 and $3,600 for children 5 and younger.
The maximum credit is available to taxpayers whose income:
- $75,000 or less for singles
- $112,500 or less for head of household
- $150,000 or less for married couples filing jointly, and qualified widowers and widowers
Beyond these thresholds, the additional amount on top of the original $2,000 credit — $1,000 or $1,600 per child — is reduced by $50 for every $1,000 in the modified AGI.
Eligible families must file a tax return to receive the amount they owe.
In addition, Schedule 8812 must be attached to your tax return. This can be accessed on the IRS website.
We explain The latest child tax credit may be available.
We pay for your stories!
Do you have a story for the American team The Sun?
https://www.the-sun.com/money/4705777/child-tax-credit-worth-thousands-tax-returns-irs/ $8,000 Child Tax Credit Available You Might Not Know – See If You’re Eligible for Cash