Parents Breathing a Little Easier After Child-Tax Credit Funds

• Author: Jeffrey Simmons
• Posted: 2024-08-28

This week, millions of parents across the United States were finally able to breathe. This is because, under the American Rescue Plan passed in March and signed by President Biden, parents with children under the age of six will receive $3,600 per child and $3,000 if they are between the ages of 7 and 17. According to the Biden administration as well as Democrats in Congress, the child tax credit was desperately needed by parents who either lost their job or had to choose between a job or taking care of their children, as many are still learning remotely. In fact, the Center on Poverty and Social Policy at Columbia University stated that the extra income to these parents was going to be so impactful that over 5 million families and children would be lifted out of poverty.

Credit Restrictions & When Checks Will Begin to Hit Bank Accounts

One of the biggest concerns regarding the child tax credit funds is determining who qualifies. Although the age restrictions were agreed upon, the income level of a family was not. Although initially only families making up to $75,000 were eligible for the funds, Congress later removed the restrictions, and thus families making up to $150,000 are eligible to receive the credit. So, when are funds going to start hitting bank accounts? Understandably, parents across the nation are wondering when they can expect to receive their checks. As of July 15, 2021, the IRS can confirm that over 90% of families who qualified for this tax credit have received their funds via direct deposit. But, of course, if you have not received your funds, it is important that you contact the IRS via their official website to receive further information.

Issues with Fund Distribution

Above we spoke about how parents may have some difficulty accessing their funds. Although contacting the IRS is always recommended, the process may be a bit slow as millions of people are attempting to do the same. So, if you have not received your funds by now, here is one of the most common reasons why that may be the case. The fact is that some families may not have filed taxes in 2020. If you have not received stimulus checks in the past, this may be the case. In order to receive your funds, you will need to go on the IRS website and sign up to claim your child tax credit. Don't worry; you won't have to quickly do your taxes and submit them, but you may need to provide some information to the IRS before they accept your request.

Backlash from Republicans

On the other side of the aisle, Republicans have accused the Democratically controlled Congress as well as President Biden of encouraging people not to go out and look for a job. They claim that the move is simply too expensive and risky, especially at a time when the U.S economy is barely recovering from the economic downturn of 2020. Although there have been reports of a labor shortage across the nation, proponents of the child tax credit have mentioned that the Republicans are simply not looking at the bigger picture. As stated above, one of the biggest concerns for Democrats is that parents are having to choose between working and either staying home with their children so they can learn properly or simply minimizing the chances of spreading the virus onto them.

Money Used as Parents See Fit

Another concern regarding the funds involves the potential restriction against what the money can be used for. Some say that the money should only be used for the needs of the child and nothing else. However, Congress and the President agreed that the funds should be used as parents see fit. According to proponents, every family is going through its own type of economic difficulty, and thus no restrictions should be set. For example, some families may need the tax credit to pay for their rent, while others may need the money to afford critical medicine for their children. For the time being, this seems to have been the right choice as parents across the nation have reported needing the money to directly or indirectly provide for their child.