The first payment of the increased child tax credit was issued to tens of millions of families on Wednesday night, according to the Internal Revenue Service and the Treasury Department. The increased credit will offer them additional money each month until the end of 2021, as well as a tax relief the following year.
The payouts were approved as part of President Joe Biden's $1.9 trillion stimulus plan, which was signed into law in March by Democrats. The initial payment was $15 billion. The infusions may assist low-income families the most, decreasing child poverty in half, but the extra funds will also benefit better-off American families.
The fourth wave of stimulus checks is unlikely due to the implementation of the child tax credit program. The first set of stimulus checks was announced by Donald Trump in March of last year, and the packages are believed to have cost $1 trillion.
Other stimulus checks
This is proving to be the mother of all announcement weeks when it comes to stimulus check news for those waiting for the next information on when further stimulus payments will arrive. In this article, we'll take a deeper look at everything that's coming up as part of these changes, according to BGR:
Golden state's extra stimulus checks
First, there's the fresh round of stimulus checks for California residents. Millions of Californians earning between $30,000 and $75,000 per year will get an additional $600 payment later this fall as part of the state budget compromise announced by Newsom on Monday.
Early September is when the payments are likely to be made. They're also a continuation of California's stimulus package, which has already sent $600 stimulus checks to low-income people.
IRS refunds
Let's move on to the upcoming IRS refunds, which will include unemployment income. When a person is laid off and subsequently receives unemployment benefits, the IRS usually considers that income to be taxable the following year. However, a clause in President Biden's huge stimulus measure passed in March exempted a part of people's unemployment benefits from last year from taxation.
Except for individuals who had already filed their federal tax returns early, this was excellent news. That is, before March when the legislation containing this clause took effect.
Unemployment benefits
If you've been waiting for your unemployment tax return from the IRS, you may get it on Thursday or shortly thereafter. The IRS has announced that almost 4 million Americans who paid taxes on unemployment benefits received last year would get another batch of refunds. On July 14, the agency will provide refunds through direct deposit, and on July 16, reimbursements will be issued via paper check, as per CNET.
The refunds are part of the American Rescue Plan, which made the first $10,200 in unemployment benefits for 2020 or $20,400 for married couples filing jointly nontaxable income. Approximately 13 million taxpayers may be entitled to the adjustment since they submitted their taxes before the measure was approved and overpaid.
No payments received?
Per MoneyWise, the majority of individuals will not have to do anything to get their child tax credit payments. If the IRS has your information, the money will simply appear in your account or be mailed to you about the middle of each month until the end of the year. However, if no money appears, there are a few steps parents may take to investigate a missing payment.
- Check to see if you need to file a tax return. Those who don't usually pay their taxes or are behind this year will want to file as soon as possible to guarantee the IRS has their information and can send them their money.
- Check the website. The Internal Revenue Service (IRS) has established an online gateway to make it faster and more effective for parents to change their address, bank account, and other payment-related information.
- Make sure you're eligible. The IRS determines eligibility based on the most recent tax return on file, and some families may have earned too much to qualify for the payments.
- Check to see if you've been scammed. The IRS is advising Americans to be on the alert for child tax credit frauds.
Related Article: Stimulus Check Roundup: Here's How Much Your Family Will Get With All Federal Aids During The Pandemic
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