{"id":3826,"date":"2021-10-29T10:08:18","date_gmt":"2021-10-29T15:08:18","guid":{"rendered":"https:\/\/kramerwealth.com\/?p=3826"},"modified":"2024-01-24T09:49:08","modified_gmt":"2024-01-24T15:49:08","slug":"child-tax-credit","status":"publish","type":"post","link":"https:\/\/kramerwealth.com\/child-tax-credit\/","title":{"rendered":"Child Tax Credit"},"content":{"rendered":"<p class=\"responsive-video-wrap clr\"><iframe title=\"Child Tax Credit\" width=\"1200\" height=\"675\" src=\"https:\/\/www.youtube.com\/embed\/PGKhUJ0LXAU?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture\" allowfullscreen><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">Hello everyone, today\u2019s vlog will cover the Child Tax Credit today. It is changed for 2021 only when the President signed the American Rescue Plan into law on March 11, 2021. When the law became effective, it impacts the Child Tax Credit. Previously, before the new law took effect, the child tax credit was $2,000 per child under the age of 17. Now, the new law increased the credit to $3,000 per child under the age of 18. In addition, for those who have children under the age of 6, there is an additional $600 credit per child.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Not everyone will get the increase as it is based on income. When looking at income, if your filing status is married filing jointly and you earn less than $150,000, you will get the full increased $3000 tax credit. If you file single or head of household, you must earn less than $112,500 to get the full $3000 credit. If your income is over the thresholds, you will not get the additional $1000 per child. You will still get the original tax credit of $2,000 per child, just as you previously received.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">One provision of the change in law is that you will receive <\/span><i><span style=\"font-weight: 400;\">half <\/span><\/i><span style=\"font-weight: 400;\">\u00a0of the total credit through monthly installments from July to December this year.\u00a0 The other half of the credit will be received when you file your income tax return next year. The monthly installments are being sent on the 15<\/span><span style=\"font-weight: 400;\">th<\/span><span style=\"font-weight: 400;\"> of each month. Those who are eligible for the full credit, meaning their income is below the thresholds, will receive $250 monthly for each child aged 6-17 and $300 monthly for each child aged 0-5. However, if your income exceeds the thresholds and you are not eligible for the extra $1000 or the extra $1600, you will receive $166.66 monthly per child, regardless of age (up to 18).<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">The monthly installments will be direct deposited to the same bank where you get your tax refund direct deposited.\u00a0 If you don&#8217;t normally get a refund or get refund by check, it will be mailed to you by check. If a person did not file taxes at all for 2020, they can sign up at <\/span><a href=\"https:\/\/www.getctc.org\/en\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">https:\/\/www.getctc.org\/en<\/span><\/a><span style=\"font-weight: 400;\"> to notify of their eligibility for the credit.<\/span><\/p>\n<p><b>A word of caution regarding this credit:<\/b><span style=\"font-weight: 400;\"> These monthly payments are an <\/span><i><span style=\"font-weight: 400;\">advanced credit<\/span><\/i><span style=\"font-weight: 400;\"> of what you already get in your taxes each year. The government is now giving you half of the credit now in advance instead of waiting for you to file your tax return next year. $1000 of that is the extra amount but $500 of that is what you would have normally gotten when you filed your return.\u00a0 Now, that $500 will be automatically deducted from what you normally would have claimed on your tax return the following year because it has already been given in advance.\u00a0 When you file your taxes next year, if you normally would get a refund, it will now be $500 less than it normally would be.\u00a0 If you normally owe in taxes, this loss of credit will increase your tax liability by $500. You\u2019ll want to be sure you budget accordingly to prepare for this decrease in tax refund or increase in tax liability.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For those whose income exceeds the thresholds and do not qualify for the additional $1000 credit, they will still get the original $2000 credit per child, with monthly installments from July to December covering half of the credit, or $1000 per child. This means next year when you file your income taxes, if you normally receive a tax refund, it will be $1,000 less. And if you normally have a balance owed when you file, you will owe $1000 more. Again, this is because you have already received from the government that $1000 in advance rather than waiting until you file your taxes to claim it.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Let\u2019s look at another example.\u00a0 A person will four children who qualifies for the credit can expect to owe $2,000 more or receive $2,000 less in tax refund next year.\u00a0 If you don&#8217;t qualify, you can expect to owe $4000 more or receive $4,000 less in tax refund next year. You can figure out the impact by multiplying the advanced tax credit by the number of children you have so you can be prepared for that impact.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We encourage you to make sure you get the chance to discuss with your tax advisor and prepare for the impact on your taxes next year and budget accordingly. You wouldn\u2019t want to spend all of the money you receive from the monthly payments and then be shocked by the tax bill you receive next year without having a way to pay for it. So again, prepare yourself for any potential impact it may have on you. <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Hello everyone, today\u2019s vlog will cover the Child Tax Credit today. It is changed for 2021 only when the President signed the American Rescue Plan into law on March 11, 2021. When the law became effective, it impacts the Child Tax Credit. Previously, before the new law took effect, the child tax credit was $2,000 [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"video","meta":{"ocean_post_layout":"","ocean_both_sidebars_style":"","ocean_both_sidebars_content_width":0,"ocean_both_sidebars_sidebars_width":0,"ocean_sidebar":"0","ocean_second_sidebar":"0","ocean_disable_margins":"enable","ocean_add_body_class":"","ocean_shortcode_before_top_bar":"","ocean_shortcode_after_top_bar":"","ocean_shortcode_before_header":"","ocean_shortcode_after_header":"","ocean_has_shortcode":"","ocean_shortcode_after_title":"","ocean_shortcode_before_footer_widgets":"","ocean_shortcode_after_footer_widgets":"","ocean_shortcode_before_footer_bottom":"","ocean_shortcode_after_footer_bottom":"","ocean_display_top_bar":"default","ocean_display_header":"default","ocean_header_style":"","ocean_center_header_left_menu":"0","ocean_custom_header_template":"0","ocean_custom_logo":0,"ocean_custom_retina_logo":0,"ocean_custom_logo_max_width":0,"ocean_custom_logo_tablet_max_width":0,"ocean_custom_logo_mobile_max_width":0,"ocean_custom_logo_max_height":0,"ocean_custom_logo_tablet_max_height":0,"ocean_custom_logo_mobile_max_height":0,"ocean_header_custom_menu":"0","ocean_menu_typo_font_family":"0","ocean_menu_typo_font_subset":"","ocean_menu_typo_font_size":0,"ocean_menu_typo_font_size_tablet":0,"ocean_menu_typo_font_size_mobile":0,"ocean_menu_typo_font_size_unit":"px","ocean_menu_typo_font_weight":"","ocean_menu_typo_font_weight_tablet":"","ocean_menu_typo_font_weight_mobile":"","ocean_menu_typo_transform":"","ocean_menu_typo_transform_tablet":"","ocean_menu_typo_transform_mobile":"","ocean_menu_typo_line_height":0,"ocean_menu_typo_line_height_tablet":0,"ocean_menu_typo_line_height_mobile":0,"ocean_menu_typo_line_height_unit":"","ocean_menu_typo_spacing":0,"ocean_menu_typo_spacing_tablet":0,"ocean_menu_typo_spacing_mobile":0,"ocean_menu_typo_spacing_unit":"","ocean_menu_link_color":"","ocean_menu_link_color_hover":"","ocean_menu_link_color_active":"","ocean_menu_link_background":"","ocean_menu_link_hover_background":"","ocean_menu_link_active_background":"","ocean_menu_social_links_bg":"","ocean_menu_social_hover_links_bg":"","ocean_menu_social_links_color":"","ocean_menu_social_hover_links_color":"","ocean_disable_title":"default","ocean_disable_heading":"default","ocean_post_title":"","ocean_post_subheading":"","ocean_post_title_style":"","ocean_post_title_background_color":"","ocean_post_title_background":0,"ocean_post_title_bg_image_position":"","ocean_post_title_bg_image_attachment":"","ocean_post_title_bg_image_repeat":"","ocean_post_title_bg_image_size":"","ocean_post_title_height":0,"ocean_post_title_bg_overlay":0.5,"ocean_post_title_bg_overlay_color":"","ocean_disable_breadcrumbs":"default","ocean_breadcrumbs_color":"","ocean_breadcrumbs_separator_color":"","ocean_breadcrumbs_links_color":"","ocean_breadcrumbs_links_hover_color":"","ocean_display_footer_widgets":"default","ocean_display_footer_bottom":"default","ocean_custom_footer_template":"0","ocean_post_oembed":"","ocean_post_self_hosted_media":"","ocean_post_video_embed":"","ocean_link_format":"","ocean_link_format_target":"self","ocean_quote_format":"","ocean_quote_format_link":"post","ocean_gallery_link_images":"off","ocean_gallery_id":[],"footnotes":""},"categories":[19,23,22],"tags":[40,33],"acf":[],"_links":{"self":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3826"}],"collection":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/comments?post=3826"}],"version-history":[{"count":2,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3826\/revisions"}],"predecessor-version":[{"id":3974,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/posts\/3826\/revisions\/3974"}],"wp:attachment":[{"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/media?parent=3826"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/categories?post=3826"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/kramerwealth.com\/wp-json\/wp\/v2\/tags?post=3826"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}