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Denver Accounting Firm: Child Tax Credit Questions Answered

February 14, 2022

Numerous families across the country didn’t get extra funds added into their accounts this month as the calendar turned to a new year. The Child Tax Credit, restructured as part of the ‘Build Back Better’ plan instituted at the federal level, utilized a new concept in an effort to give families more immediate money in their pockets. Instead of having to wait and claim dependents when filing their tax return, a majority of individuals and couples elected to receive a portion of this money earlier than anticipated.

Advance child tax credit payments were paid in the amounts of $300 and $250 each month, for six months, depending on age and number of qualifying children. Those who were eligible to claim kids under 6 years of age received the larger amount for each and the credit continued for all claimed dependents until age 17 for this past tax year. However, these payments were not dispersed in January as they have been temporarily discontinued.

Discontinued Credit

The payments were originally set up for eligible individuals to receive the credits for their children in advance, after initially raising the qualifying total amounts. Half of these funds were distributed up front, while the remaining balance is still eligible for receipt.

Not So Fast

While the lack of additional money in your account may have been a shock in January, there remains funding available and eligible individuals should be able to claim these amounts when filing their taxes for the preceding year.

Tax Filing

Due to the raise in credit, half of the funds were pre-distributed prior to tax filing in an effort to offer immediate assistance to those with qualifying dependents. Fortunately, the remaining balance will be distributed when taxes are filed. Recipients should receive notice of the amounts already issued, paving the way for the application of their remaining credit on any filed taxes. For example, if you’re married and have an eight year old child, one-half of the total credit ($3,000 / 2 = $1,500 … $1,500 / 6 = $250.00 per month) was paid in advance using the installments and the remaining half (the other $1,500) can now be claimed on your tax return.

If you need assistance determining more details on the Child Tax Credit, how it relates to your individual circumstances, are in need of filing a tax return, or have any other related questions then let the professionals at Bloch Rothman and Associates assist you today. In addition to providing answers for your questions, they can also take care of multiple other issues dealing with paying or owing back taxes, required audits signaled by either the IRS or an outside agency, or any other personal or corporate wealth management issues. Along with providing a top quality tax service, our group can also complete all types of returns and get answers to any other factors associated with financial issues or concerns you may have. Serving Denver and all of the surrounding areas for 35 years, our firm has an extensive history in helping clients with any and all of their tax issues or dealings with the Internal Revenue Service. If you have questions about your personal, business, estate, or any other filings, don’t hesitate to contact us today. Available for all of your tax needs, there are also a number of bookkeeping and payroll services offered to assist you and your business. We look forward to meeting you and providing the type of service you can rely on whatever your needs may be very soon!