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child tax credit in 2021 with new bill passed

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  • child tax credit in 2021 with new bill passed

    I realize it's not quite law yet but I've researched around on this and think this part of the COVID bill will survive: the child tax credit. We're a family with a modified AGI between $200-$400k. For 2020 we're going to claim the child tax credit which is big for us because it's $2k per child and we have 3 and we fall below $400k to qualify. I'm very confused about the latest bill that passed the senate and is going to be approved by the House and Biden will sign. Not interested in the politics but interested in figuring out if we'll continue to get this credit in 2021. As I understand it the credit has increased even more but HH AGI cannot be more than $200k. We're over that. Does the current bill replace the old child tax credit? Basically trying to see if we're going to lose that big tax credit.

  • #2
    my understanding is that 2021 child tax credit $3600 only for 2021 tax year and yes it does replace the $2000 only for one year.
    The original bill House passed modified by the senate so the bill needs to go back to the House again for the vote then president will sign.

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    • #3
      thanks-while I can't find the specifics this is my understanding too...a 2021-only thing that we can't use because of our AGI but will get the credit back in 2022 unless they extend the plan just being passed (which will be harder to extend due to things being passed via reconciliation this time)

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      • #4
        Error
        Last edited by GastroMastro; 03-08-2021, 11:42 AM.

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        • #5
          I was wondering the same. I would hate to lose 8K in tax credit

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          • #6
            Originally posted by Lordosis View Post
            I was wondering the same. I would hate to lose 8K in tax credit
            I believe it’s still $400,000 but the ADDITIONAL credit beyond the $2000/child has an income limit

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            • #7
              Okay - I have an additional question...

              I am holding off on filing my taxes for the time being. Will this bill affect 2020 child tax credit - or is it for next year? I have two kids so currently get a $4000 credit but still owe just under $600 on federal taxes this year. I have been waiting to file since I can't seem to find a clear answer. Seems as though it's not until 2021 tax season - but apparently you can start getting a monthly $300 check per kid starting in July 2020.

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              • #8
                Why can’t they just increase the DCFSA to 5k per kid while they’re at it.

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                • #9
                  Originally posted by WorkingToFish View Post
                  Okay - I have an additional question...

                  I am holding off on filing my taxes for the time being. Will this bill affect 2020 child tax credit - or is it for next year? I have two kids so currently get a $4000 credit but still owe just under $600 on federal taxes this year. I have been waiting to file since I can't seem to find a clear answer. Seems as though it's not until 2021 tax season - but apparently you can start getting a monthly $300 check per kid starting in July 2020.
                  I can’t speak to the fact that people can start getting monthly payments this year but this is for 2021 income. I have three kids and am about to file and will be using the $6k tax credit as that was the law as of December 31, 2020

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                  • #10
                    Originally posted by JBME View Post
                    I realize it's not quite law yet but I've researched around on this and think this part of the COVID bill will survive: the child tax credit. We're a family with a modified AGI between $200-$400k. For 2020 we're going to claim the child tax credit which is big for us because it's $2k per child and we have 3 and we fall below $400k to qualify. I'm very confused about the latest bill that passed the senate and is going to be approved by the House and Biden will sign. Not interested in the politics but interested in figuring out if we'll continue to get this credit in 2021. As I understand it the credit has increased even more but HH AGI cannot be more than $200k. We're over that. Does the current bill replace the old child tax credit? Basically trying to see if we're going to lose that big tax credit.
                    Don’t have the link, but I read something saying it will essentially act like a bonus 1600/child if you fall under 200k. So 150-400k will still be 2000/child, but it will be 3600 if under. Remember: you’re the bad guy because you’re rich.

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                    • #11
                      If this money isn't coming until next year why is it part of a covid relief bill? 🙄

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                      • #12
                        Originally posted by GastroMastro View Post

                        I believe it’s still $400,000 but the ADDITIONAL credit beyond the $2000/child has an income limit
                        I have the same understanding. Spent some time reading news articles about it .

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                        • #13
                          No, the money is coming this year. The $1400 payments are coming immediately and I believe these child tax credit payments are coming monthly shortly thereafter, not next year. I think this all gets figured out next year at tax time but the payments start well before. I would love to see something that shows this is in addition to the $2000/child tax credit but haven't found anything yet. I'm also not sure I'm a bad person because I'm "rich" whatever that means

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                          • #14
                            Here is a good article about it;

                            https://www.cnbc.com/2021/03/09/how-3000-dollar-child-tax-credit-works.html

                            Families that are ineligible for the new $3,000 credit due to earning higher adjusted gross incomes would still be able to claim the $2,000 per child credit which is available to those making up to $200,000 ($400,000 for married couples filing jointly).

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                            • #15
                              Either way it the extra is not going to families who make over 150K so we are out as an evil rich family

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