THE next child tax credit payment will arrive this week on October 15.
Families who do not meet eligibility requirements may want to unenroll from advance payments, to avoid having to pay back the IRS.
Advance payments are optional, and the deadline to opt out of them is November 1, at 11:59pm ET.
Opting out of advance payments is a smart move for families who know that their financial situation is changing this year.
If you are expecting a payment, you can track it by visiting the non-filer tool, which will remain open until next Friday, October 15.
Families that do sign up for the payments could receive hundreds of dollars every month for each qualifying child.
The IRS is using 2020 tax returns to determine eligibility for the monthly payments, so those who have not filed their taxes yet could miss out on the benefits.
Additionally, parents who didn’t make enough income to file a tax return could also be left out as the IRS would have no way of knowing if they qualify for the payments, as reported by CNET.
Read our child tax credit live blog for the latest news and updates…
SOME EXPERTS BELIEVE EXPANDED CREDIT SHOULD BE PERMANENT
A group of economists have argued that Child Tax Credits worth up to $3,6000 should be made permanent.
In a letter signed by 448 experts, they said a permanent boost to the 2021 child tax credits would “dramatically reduce childhood poverty.”
It also cited a study that found that a permanent program would cost 16 cents for every $1 in new economic benefits.
SOCIAL SECURITY REQUIREMENT OPENED UP
Only kids with Social Security numbers are eligible to claim the tax credit, CNBC reports.
So, some lawmakers have proposed to allow kids with individual taxpayer identification numbers (ITIN) to receive the credit.
Researchers at the Institute on Taxation and Economic Policy think this change could benefit up to one million children.
The 2017 Tax Cuts and Jobs Act prevented families with ITINs to claim the stimulus payment.
TWO KINDS OF 529 PLANS
There are two types of plans – the prepaid tuition and education savings – and the benefits vary depending on which one you choose.
All 50 states and the District of Colombia sponsor at least one of the plans.
The funds in the accounts can only be used to educational purposes and savers face forking out a huge fee to withdraw the money for any other reason.
WHAT IS A 529 PLAN?
A 529 is a tax-advantaged savings plan designed to get you to save for future education costs, according to US Securities and Exchange Commission.
They’re sponsored by states, state agencies or educational institutions and authorized by… Brinkwire Brief News.