The Biden administration is ramping up efforts to make sure taxpayers eligible for monthly child tax credit checks will get them when the first payments start next month. More than 36 million eligible families are expected to start seeing the payments passed under the American Rescue Plan July 15.
Children under the age of six are set to receive payments of $300 a month through the end of the year while children ages six to 17 will receive payments of $250 a month. On Friday, the Biden administration announced it will work with officials, faith-based organizations and groups that work with children to help make sure low-income families who would otherwise fall through the cracks because they are not part of the tax system are able to receive the credit.
"We want to make sure that every family with children who qualifies for this tax credit receives it because of course they deserve it," said Vice President Kamala Harris, speaking about the benefit Friday while visiting a child care center. "And because that will help us lift half of those children… living in poverty, out of poverty."
On top of increasing the credit for parents from $2,000 to $3,000 per children ages 6 to 17 and $3,600 for those under six for this year, the 2021 Child Tax Credit was also expanded so that low income families who were otherwise earning too little to pay taxes would still be eligible for the monthly payments.
Earlier this week, the IRS announced it will send the first in a series of letters to families about their potential eligibility for the Child Tax Credit based on their 2019 or 2020 tax returns or other information they may have provided to the IRS.
On Tuesday, IRS Commissioner Charles Rettig told members of the Senate Finance Committee that his agency is also working with "thousands and thousands" of community-based organizations to distribute information in multiple languages. Rettig said a lot of the outreach effort is based on what they learned while working over the past year to administer the three rounds of economic stimulus payments, which he said are now "affectionately referred to on the street as the stimmies." Those direct COVID-relief payments first started under President Trump amid the pandemic and then continued with the latest round of stimulus money from thepassed in March.
"We've been very fortunate to interact with more than 10,000 different organizations around the country that previously were not interactive with the Internal Revenue Service based on what our core processes were," Rettig said. He said the agency has been able to capitalize on that for the Child Tax Credit payments.
According to the IRS, most families will not need to take any action to get their payment. The vast majority of payments will be made through direct deposit, and in some cases the IRS will send families checks and debit cards by mail.
Under the American Rescue Plan, individuals making up to $75,000, single parent head of household filers making up to $112,500 and married couples who file jointly with a combined income up to $150,000 per year are eligible to receive the full amount.
Families will be able to check if they are eligible via one of several online tools the IRS is launching ahead of the first payments next month. Another portal will also allow families to update information and opt out of receiving payments in advance as well as allow them to check the status of payments later this year.
On Thursday, Democrats on the House Ways and Means Committee released their own information and Frequently Asked Questions about the Child Tax Credit to help prepare families for the first direct payments.
"Nearly 90 percent of our nation's children will feel the positive effects of the expanded Child Tax Credit, a key piece of Congress's COVID relief law that Ways and Means Committee Democrats authored. These advance payments of that credit will ensure families receive this crucial support when they need it most, all while making dramatic reductions in child poverty," said Ways and Means Committee Chairman Richard Neal, a Democrat from Massachusetts.
While the direct advance payments only apply through the end of this year, the Biden administration has already proposed extending the increased tax credit as part of its American Families Plan, and some Democrats are pushing to make the change permanent. Several Republicans, including Utah Senator Mitt Romney, have proposed their own versions of monthly child payments.