Income tax

Bill makes changes to child tax credit and earned income tax credit


The major spending bill passed by the House of Representatives earlier this month amends two major tax credits.

The bill would extend the expansion of the child tax credit for one year. It would also make the credit fully repayable on a permanent basis, which would benefit low-income people, according to CNBC.

Before the pandemic, low wages could only get part of the tax break as a refund, while high wages would get the full value. Low-income people were also not eligible for the credit if they earned less than $ 2,500 a year, CNBC said.

The House bill would make reimbursements available to everyone at all times.

The expanded credit, passed as part of legislation enacted earlier this year, provides $ 3,600 for children 5 and under, and $ 3,000 for ages 6 to 17.

Experts say the expanded child tax credit helps reduce poverty, according to CNBC.

The House bill would also extend the extension of the earned income tax credit by one year, according to the Washington Post.

The credit benefits low and modest income families. Earlier legislation increased its value nearly three times and increased the income limit of the credit to $ 21,430 for individuals and $ 27,380 for married couples so that more childless workers would qualify, said the Post.

The Senate has yet to pass the House bill before the tax credit changes take effect. The bill, known as the Build Back Better Act, includes a host of social policy and climate change provisions.

The Central New York Community Foundation recently won a $ 50,000 grant from the EITC Funding Network to help 1,300 eligible families in Syracuse access the credits they are entitled to, but may not.

Families that earn the least generally do not file tax returns, leaving the IRS with no track of them for credit payment.

The foundation said it would use the grant and $ 50,000 of its own funds for outreach and efforts to help these families get their benefits.

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