Biden’s Child Tax-Credit to Send First Payments on July 15
(Bloomberg) -- About 39 million U.S. households will begin receiving monthly child tax-credit payments in mid-July, most of them automatically, as part of the March Covid recovery bill.
The administration announced Monday that monthly payments of as much as $300 for each child under age six, and as high as $250 per month for children age six to 17, would begin on July 15 and continue for the rest of the year.
“We are getting you a tax cut this year -- now, when you need it, and not have to wait,” Biden said Monday at the White House. “This tax cut sends a clear and powerful message to American working families with children: Help is here.”
Of the eligible households, about 80% will receive payments automatically through direct deposit and don’t need to do anything to set that up, said officials familiar with the plan, speaking to reporters on condition of anonymity.
The advance payments, by starting mid-year, will deliver half of the annual child tax credit, which was expanded on a one-time basis in the American Rescue Plan in March. Up until now, the child tax credit was something added on to a family’s tax refund once a year.
Biden has proposed extending that measure, but it’s not clear if Congress will support it. The one-time hike boosted the maximum credit in 2021 to $3,600 for children under age six, and to $3,000 per child for those ages six to 17.
Recipients who don’t have direct deposit access will get payments through other methods, like checks or debit cards, the officials said. U.S. officials are launching portals and information campaigns to publicize the program and enable changes, including for people who want to opt out.
Households eligible for the payments account for about 88% of children in the U.S.; the remainder have income above the program’s threshold. The payments are based on 2019 or 2020 tax returns.
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