The American Rescue Plan, which will help millions of Americans with their finances, was enacted into law on March 11, 2021. However, these tax benefits will either return to their pre-American Rescue Plan levels or expire.
The plan featured a third round of stimulus assistance and enhanced tax benefits that families may claim on their 2021 taxes (the taxes filed in 2022).
You can read the answers below to better understand how the main tax advantages will alter over the upcoming tax season.
The Child Tax Credit was enhanced in a number of ways under the American Rescue Plan for the tax year 2021.
- For each dependent kid under the age of six and for each dependent child between the ages of six and seventeen, the Child Tax Credit rose from $2,000 to a maximum of $3,600.
- Additionally, for the first time, a dependent child who was 17 could be claimed for the Child Tax Credit.
- Additionally, the credit was entirely refundable, making it possible for you to get it even if you had no outstanding tax debt.