It was announced that starting in July, families with children will receive a monthly direct deposit of $300 as part of the Child Tax Credit initiative. This post started gaining significant attention on social media:
“In 2024, the IRS will make a $300 direct deposit payment on the 15th of each month to children under six years of age,” the publication states. “Those aged six to 17 will receive $250 each month. Monthly payments from the IRS 2024 CTC are expected to begin on July 15, 2024 for all eligible individuals”.
This assertion was inaccurate as it misrepresented information from a US Rescue Plan initiative, which offered advance payments of the child tax credit to parents, rather than children, from July to December 2021 and was included in the Covid 2019 pandemic assistance efforts. Consequently, it was anticipated that the program would not proceed beyond this timeframe.
Child Tax Credit Available for 2025
Speculation surrounding this new assistance has emerged lately, as the budget suggested for 2025 by President Joe Biden includes provisions to revive the enhanced child tax credit from 2021 and enable families to access their tax credits via monthly payments. Nonetheless, this proposal faces significant hurdles in the Republican-led House due to the upcoming elections.
The House of Representatives approved a bill in January aimed at boosting the refundable child tax credit, yet the Senate never held a vote on the proposal.
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The framework resembled the CTC from 2021, featuring advance CTC payments. In 2024, the CTC reverted to its initial structure as a partially refundable tax credit. This allows you to eliminate your tax liability completely, and in exchange, you may get back a part of any leftover credit as a refund. It is essential to claim the CTC during the filing of your annual return. If your tax liability stands at $0, you may be eligible to receive as much as $1,700 for each qualifying child in the form of a refund.
At present, individuals who have dependent children are eligible to receive a non-refundable tax credit of as much as $2,000 for every child, provided they satisfy the program’s criteria, which aids in lowering their tax burden. A refundable credit of up to $1,600 per child is also available through the additional child tax credit.
