Increase In Child Tax Credits Makes All The Difference This Year

Tax credit

Child tax credits were given great importance last year in the project of America’s Rescue Plan with a significant increase, this provided parents with almost a hundred dollars for each child who is eligible. 

Child Tax Credits Returning Back To Its Pre-Pandemic State 

Along with the significant increase, it also did broaden the eligibility for the age dependants by introducing advanced monthly payment schemes and allowing families to pay little to no federal income taxes for the received payments.

The census data recently came up with reports that about 2 million poverty-stricken children were lifted up from their circumstances due to the impact of a one-year expansion. 

But as that enhancements are coming toward their end, with the expiration of their previous benefits and criteria for child tax credits most have largely stepped back into the pre-pandemic conditions. 

The maximum amount of tax credit eligible per child in a family has reverted back to its previous expansion levels up to $2,000 per annum, this stands for all applicants under the age of 17 as declared on 31st December 2022.

The expanded child tax credit for the taxation year 2021 amounted to $3,600 for a family of children aged 5 and under along with $3,000 for ages between 6-17. This gave the poverty-stricken population new hope with a huge range of relief that covered most expenses till a child steps into adulthood, but that’s no longer claimable. 

For applicants to grant eligibility for their tax breaks coming from tax filings from 2022, individuals and families are expected to meet certain requirements. Firstly, applicants must have modified and well-adjusted gross income, or else MAGI which shall be in the ballpark of $200,000 or else $400,000 more or less if tax filing is being done jointly.