Sharon Kreider:

Hi, I'm Sharon Kreider, CPA, and we're here to talk about the child tax credit and particularly the advanced payments, which begin July 15th, 2021. First, a little background on the child tax credit.

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Background:

We've had a child tax credit before, it was expanded in prior legislation. This is another expansion of the child tax credit. It is from the American Rescue Plan Act, which was at the beginning of the year, March 2021. And the credit for this expansion is presently only effective for 2021.

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The estimate is that 39 million households will qualify for this expanded child tax credit. That's almost 90% of the children in the United States. So the families with qualifying children, 39 million households are stated to get an advance, a monthly payment. And of course, the American Rescue Plan had several provisions to stimulate the economy and make sure that we had a smoother ramp-up to where we were before the shutdowns and, and restrictions from the COVID pandemic.

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Sharon Kreider:

The payments are as much as:

$3,000 per child, for children between ages six and 17 years old.
$3,600 per child, for children under six years old.

Note: All working families will get the full credit if they make less than $150,000 for a couple, and less than $112,500 for a family with a single parent, head of household, and $ 75,000 for a single parent, filing separately.

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