SPOKANE, Wash. — The end of many pandemic programs means big changes when it comes to filing your taxes. Several viewers reached out to ask if the Child Tax Credit was being taken away.
The short answer is no, but there are some changes to know about.
THE QUESTION
Is the Child Tax Credit being taken away?
THE SOURCES
Mark Steber, Chief Tax Information Officer at Jackson Hewitt Tax Service
THE ANSWER
We can VERIFY that no, the Child Tax Credit has not been taken away, but it has returned to pre-pandemic levels.
The American Rescue Plan increased the Child Tax Credit to up to $3,600 per child, but only for the 2021 tax year.
This year, the Child Tax Credit is at $2,000 per child, which is the same amount as it was pre-pandemic.
WHAT WE FOUND
If you filed taxes last year you might have received an expanded child tax credit. The American Rescue Plan increased the credit to $3,600 for children ages 5 and under at the end of 2021; and. $3,000 for children ages 6 through 17 at the end of 2021.
But the increase was only for the 2021 tax year.
"A lot has changed, the least of which is it went down from $3,600 as a maximum and fully refundable," Steber explained. "Both of those changes were put into place for the pandemic."
So, while the expanded credit has ended, the pre-pandemic Child Tax Credit is still available.
"Now it's back to the pre-pandemic amount of about $2,000 in credit and $1,400 refundable, if you get down to a zero tax bracket," Steber said.
Before claiming the Child Tax Credit, Steber said it is important for parents with shared custody to make sure they have the right to claim the credit.
"The custodial parent, that has the relationship and provides more than 50% of the care, they're the one who gets it, not just the person who files first. And we see that mistake made a lot each year,' Steber said. "So, if you have a dependent that you're providing care for, especially if they live with you, but that's not an absolute requirement, you need to make sure you understand the rules."
Steber recommends reaching out to a tax professional if you have any questions.
The IRS said the change in the Child Tax Credit amount means some tax filers will likely see a smaller refund this year, but Steber said that might not be the case for every filer.
"Each taxpayer situation is unique. And there's still a lot of benefits in the tax code. And a lot of life changes driving new tax benefits," Steber explained. "So, it's not really a fair statement to say last year is going to be like this year, and you're going to get 10% less. It really depends on your situation, your activity, and your facts and circumstances."
So, we can VERIFY that no, the Child Tax Credit has not been taken away. However, the tax credit has returned to pre-pandemic levels.
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