Internal Revenue Service, Personal Spending, Children, Family Finances, Tax Refunds, Tax Reform, National Taxes, Taxes, Tax Planning, Government Taxation And Revenue, Personal Finance, Personal Saving, Investment Strategy, Business News

Internal Revenue Service, Personal Spending

Why some families may want to opt out of the child tax credit payments starting in July

Why some families may want to opt out of the child tax credit payments starting in July. - @CNBC

6/19/2021 10:00:00 AM

Why some families may want to opt out of the child tax credit payments starting in July. - CNBC

For some families, it may make more sense to claim the enhanced child tax credit as a lump sum when they file 2021 taxes instead of monthly payments

"It's important to allow that ability to opt out of these payments because we don't know how people have budgeted their tax refunds," said Elaine Maag, a principal research associate at the Urban-Brookings Tax Policy Center. "And so if it's important to them that they receive this credit as one lump sum payment, we want to make sure people still have that option."

Simone Biles is at the women’s all-around gymnastics final as she cheers on Team USA Disney World and Disneyland to again require masks indoors Tokyo sees third consecutive day of record Covid-19 cases

A credit against money owedFamilies who tend to owe money to the IRS when they file their taxes may want to use the full credit next year, as opposed to getting half of it in advance, because the benefit offsets what they ultimately have to pay."It's protection from owing a surprise amount of money to the IRS," said Maag.

The enhanced child tax credit was part of the American Rescue Plan signed into law by President Joe Biden in March. For 2021, the credit increases to $3,000 from $2,000 per child under the age of 17 and gives an additional $600 benefit for children under the age of 6. headtopics.com

VIDEO1:4101:41How much money you'll have if you wait until 30 to start maxing out your 401(k)Invest in You: Ready. Set. Grow.That can either come in monthly payments — $250 per month for children between the ages of 6 and 17 and $300 per month for those under the age of 6 — or can be claimed as a lump sum on 2021 taxes.

The full credit is available to all children ages 17 and under in families with 2020 or 2019 adjusted gross income of less than $75,000 for single parents and $150,000 for a married couple filing jointly, and ends for individuals earning $95,000 and married couples filing jointly making $170,000, though they'd still be eligible for the regular child tax credit.

A lump sum for spendingOther families may want to opt out of the advance credit because they'd rather get a large lump sum to spend at once instead of smaller amounts of money each month.For many Americans, their tax refund is the largest windfall they see all year and is something they rely on in their budget. These families may be planning on a large tax refund to use for a purchase, such as a car or a refrigerator or other household item.

"We don't want to take away that ability from people," said Maag.Of course, because the credit is larger than in previous years, it's not a given that those who do claim the advanced monthly payments will automatically see a smaller tax refund than they're used to. Still, some families may prefer to get the extra cash at one time instead of having it spaced out. headtopics.com

Dubrovnik is rediscovering its own charm USA's Sunisa Lee wins gold in the women's individual all-around gymnastics final Texas Democrats to meet with Clintons, Stacey Abrams

Tax planningFor some families, likely those on the higher end of the income range eligible to receive the credit, receiving the monthly payments in advance may throw off tax planning they have in place.This generally applies to families who not only have income from wages but might have capital gains or other money coming in and so have the IRS withhold more than the standard amounts often taken out of biweekly paychecks by an employer.

"If they all of a sudden get $2,000 or $1,000 delivered to them during the year, there may be a mismatch when they come to file their tax return," said Maag.Thus, they may also prefer to use the entire credit when they file to offset any taxes they may owe. If they don't have any additional tax liability, they'd get the money back in a refund.

To see how much you could expect to receive, personal finance websitethat weighs your filing status, annual income and the number of dependents you have.SIGN UP:. Read more: NBC News »

Tempers flare in U.S. Congress as COVID-19 mask mandates return

Tempers flared in the U.S. Congress on Wednesday after its chief physician urged lawmakers to resume wearing masks to slow the spread of the highly contagious Delta variant of COVID-19, with the top Democrat labeling Republican opposition as 'moronic.'

CNBC They are not helping the disabled big mistake

These Four States Are Far From Reaching Biden’s July 4 Vaccine GoalAll four voted for former President Donald Trump in 2020. You get 4 guesses. Hint…Republicans So they praise the Former Guy for getting a vaccine ready so quickly, then they won’t take it. Brilliant. good

U.S.-Canada Border Will Remain Closed Until July—What To Expect NextO no, Canada. The Covid-19 travel restrictions have been extended until at least July 21. Are you in need of 3D PRODUCT ANIMATION VIDEO TO ENHANCE YOUR BUSINESS AND SERVICES.... We can help out... Reach Out to us Today! business USAvMEX USA 3D 3Danimation 3dmodeling 3dxanimation animation animatorvsanimation china canda Ukraine MJForbes But will Canadians who have 2 shots of WHO approved AstraZeneca, not FDA approved be given a hard time by U. S. Officials. Same as people from the U. K. and most of Europe. AZ vaccinated people were not allowed into Bruce of Broadway. Thats shooting yourself in the recovery foot. What about India border…?

Subaru to temporarily shut its plants in July due to chip shortageSubaru Corp (7270.T) said on Friday it will cut production at Japan's Gunma plants in July due to a global shortage of semiconductors. A potato famine? Really 😱

Canada extends Covid-19 travel restrictions with US until July 21About 64% of adults having received at least one dose of a Covid-19 vaccine in US as more coronavirus mandates and restrictions ease. Follow here for the latest. Pitter patter. They’re shootings themselves in the foot in terms of tourism dollars. Why not just require proof of vaccination No one cares Canada is Soviet territory

July/August Issue, Special Collector's Edition Zine & Photo Print Starring Billie EilishJuly/August Issue, Special Collector's Edition Zine & Photo Print Starring Billie Eilish Pop icon Billie Eilish graces the cover of the July/August 2021 issue of Rolling Stone magazine, photographed by Yana Yatsuk in Los Angeles. There were so many incredible photos captured at the shoot, we created this limited-ed .Billy who? Tiger Beat gimmickry. i really want this.

Canada extends U.S. travel restrictions through July 21Canada said Friday it will extend restrictions that bar non-essential travel at U.S. land borders until at least July 21. we'll behave.