The Child Tax Credit (CTC) is one of America’s strongest financial tools, providing significant assistance to millions of families to help raise their children. This article cuts into the latest updates on the CTC, including new increases, $300 direct payment dates, and eligibility requirements.
The Child Tax Credit is a vital financial aid program launched by the U.S. government to support households with low incomes, particularly those with children. For 2024, the CTC program offers financial support based on the age of dependent children.
Families with children under 6 years old receive a higher percentage of benefits. Specifically, the credit amount was increased under the American Rescue Plan Act to $3,600 per child under 6 and up to $3,000 per child aged between 6 and 17.
New Increase
On January 19, 2024, the House Ways and Means Committee passed the Tax Relief for US Families and Workers Act of 2024. This legislation is expected to raise the CTC, which is currently $2,000 per child with a refundable portion of $1,600. The refundable credit will increase to $1,800 for 2023, $1,900 for 2024, and $2,000 for 2025.
Additionally, President Joe Biden’s American Rescue Plan includes provisions for a $300 monthly payment through the Child Tax Credit. The IRS has confirmed these payments to assist families with their children’s well-being. All qualified households will benefit from this plan, ensuring equal credit distribution among vulnerable families.
The CTC is a refundable tax credit that reduces an individual’s tax liability. It is distributed as monthly payments, scheduled for the 15th of each month. For 2024, the payment dates are:
August 15
September 15
October 15
November 15
December 15
However, the exact dates may vary slightly, and claimants should verify the schedule.
To claim the $300 CTC, eligible applicants need to submit Form 1040 with Schedule 8812 and provide documentation verifying their children’s qualifications. Once verified, applicants will receive confirmation from the authorities.
Applicants must meet certain IRS qualifications to receive the CTC:
Age of Children: The child must be under 18, meaning the claimant should not be older than 17.
Income Limits: For married couples, the income limit is $400,000, and for single individuals, it’s $200,000.
Contribution to Household: The applicant must contribute more than half of their earnings to the household.
Social Security Number: The child must have a valid Social Security number.
Residency: The child must have lived in the U.S. for more than half the year.
Applicants cannot file a joint return with their spouse if they do not meet these criteria, as such applications will be rejected.
Summary
The American government has introduced several updates to the CTC for 2024, aiming to provide financial assistance to vulnerable households. Monthly payments are scheduled, and an online CTC calculator is available on the IRS website to estimate the credit amount based on current scenarios.
If eligible, but unable to avail of CTC benefits, individuals can claim the Additional Child Tax Credit (ACTC). To qualify for CTC or ACTC, claimants must meet the income requirements and provide the necessary documentation.
Stay informed and ensure you meet the eligibility criteria to maximize the benefits of the Child Tax Credit.
FAQs
How much is the new CTC for 2024?
The new CTC amount is $3,600 per child under 6 and $3,000 per child aged 6-17.
When are the CTC monthly payments for 2024?
The payments are scheduled for the 15th of each month from August to December 2024.
Who qualifies for the $300 CTC payment?
Applicants must have children under 18, meet income limits, and provide required documentation.
Can I still get CTC if my income is over the limit?
No, income limits are $400,000 for married couples and $200,000 for single individuals.
How do I claim the CTC?
Submit Form 1040 with Schedule 8812 and verify your children’s qualifications.
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A tax law expert with a knack for breaking down complex regulations into digestible insights. Ehsteem's articles on the tax news blog offer invaluable guidance to readers navigating changes in tax legislation.
