Monday, June 21 is Child Tax Credit Awareness Day
Beginning July 15, most families with children will begin receiving monthly installments of the newly expanded Child Tax Credit. Families will receive $250 per month for each child age 6 through 17 and $300 per month for children younger than 6. In order to publicize the expansion – and ensure that hard-to-reach families who did not previously file tax forms receive it – the Biden Administration has designated this coming Monday, June 21 – as Child Tax Credit Awareness Day.
“Critically, as part of Child Tax Credit Awareness Day, the Administration will encourage elected officials, organizations that fight for children, and faith-based organizations, to help low-income families—who may have such low-incomes that they are not required to file taxes—to use a new, easy Child Tax Credit sign-up tool to help give their children a lifeline out of poverty,” a White House fact sheet states.
The IRS estimates that roughly 39 million households with 65 million children – covering almost 90 percent of children in the U.S. — will begin receiving monthly payments on July 15 without any further action required. About 80 percent of these families will receive the payments via direct deposit; the rest will receive checks via regular mail. Other eligible families – those who did not file taxes in 2019 or 2020 and who did not sign up for any of the three rounds of “stimulus” payments, including the $1,400 provided in the American Rescue Plan – can still sign up to receive monthly Child Tax Credit payments. People with incomes below a certain amount do not have to file a tax form, so they are not in the IRS system. Experts say that if most of these harder-to-reach families sign up, as many as half of all children currently in poverty could be lifted out. But reaching these families is key.
If you know of such a family, you should encourage them to sign up by accessing this easy-to-use IRS portal. One of the ways groups are spreading the word is through a #ChildTaxCredit Twitterstorm to be held on Monday at 2:00 p.m. ET. You can find a toolkit for participating here, compiled by the Children’s Defense Fund and the Center for the Study of Social Policy. The Coalition on Human Needs is one of many organizations contributing to the Twitterstorm.
The American Rescue Plan, approved earlier this year by Congress and signed into law by President Biden, included a one-year expansion of the Child Tax Credit. In 2021, for most families, the Child Tax Credit is increased to $3,000 for each child age 6 through 17 and to $3,600 for each child under age 6. For example, a married couple making less than $150,000 with two children under age 6 will be eligible for a Child Tax Credit of $7,200 in 2021 – at least $3,200 more than they would have received prior to the American Rescue Plan. President Biden has proposed extending this expanded Child Tax Credit through 2025 as part of his American Families Plan.
Tax relief is typically available only when people file their taxes, but July marks the first time ever that Child Tax Credit payments will be provided monthly. Unlike in previous years, the Child Tax Credit will be available to families with little or no earnings. “This will ensure for the first time that even the most hard-pressed families will get at least as much support as more affluent families,” the White House fact sheet states. Half of the total amount will be received through the monthly payments; families will receive the rest when they file tax forms starting in January 2022.
If a family files too late to receive the first installment in July, they will still receive the full amount owed them, spread over the remaining months through the end of December. So ongoing outreach efforts will be very important.
The poorest families, who need the Child Tax Credit the most, may not know they are eligible, or how to go online to receive this help. They’ll need to receive information from Head Start programs and schools, libraries, medical offices, diaper banks or food pantries, WIC programs, community action agencies or other locations they’re likely to frequent.
If you want to learn more about the Child Tax Credit, including examples of how families in different circumstances can benefit, click here. And for even more information, including a social media toolkit and suggested activities, check out this resource kit prepared by the National Association of Counties.