The IRS Commissioner Charles Rettig said on Tuesday that the agency would start the monthly payments of the child tax credit in July. Democratic lawmakers welcome the IRS's announcement that the agency will be starting the child tax credit's monthly payments soon. This is one of the significant steps that could make Biden's relief law permanent, according to a published article on The Hill.
Democrats Welcome the Good News from IRS
Pres. Joe Biden enacted last month the coronavirus relief law. Part of it was directing the IRS to issue advance payments of the child tax credit periodically. This ensures that families receive money in installments rather than in a single payment after they file their tax returns.
In a recently published article on Belleville News-Democrat, lawmakers from the Democratic party see the monthly payments of tax credit in July to reduce child poverty and help different families in the country amid the pandemic.
IRS Commissioner Confident to Start the Payment in July
During a Senate Finance Committee hearing on Tuesday, IRS Commissioner Charles Rettig said that the department hopes to begin making payments in July, as the relief legislation requires, and monthly, as Democrats had anticipated.
Senate Finance Committee Chairman Ron Wyden said, "I was encouraged both by commissioner's assurances the IRS is on track with the rollout of the child tax credit advance payments, and that he would make the committee aware of any issues that may arise."
How Much Each Family Will Receive?
For 2021, Biden's relief program extends the tax credit in many areas. In addition to directing the IRS to make advance installments of the credit in the second half of this year, the bill raises the credit limit from $2,000 to $3,600 for children under the age of six and $3,000 for older children, according to CNBC News.
If the IRS were eligible to make monthly contributions beginning July, families would collect half of the child tax credit for 2021 in advance payments of $300 a month for children under six and $250 per month for older children. When they file their 2021 tax returns next year, they will collect the other half of the credit balance to which they are entitled.
Meanwhile, during a House hearing last month, Rettig raised fears over a time crunch, claiming that the tax-filing date's extension from April 15 to May 17 provides less time to enforce the child tax credit's advance payments.
However, he said on Tuesday, "We fully expect to launch in July. We expect to launch with payments going out on a monthly basis," he also added that he would inform the House of Congress if they could not meet the July deadline.
Rettig's remarks come as Biden prepares to release a recovery package or a rescue bill that focuses on assisting families later this year. The package is intended to prolong or make permanent credit expansion.