Stimulus money and tax breaks for children: what parents and caregivers should know

While you already know President Joe Biden $ 1.9 trillion stimulus package includes a third stimulus control until $ 1,400 per eligible person, did you know that there are other ways for your family to make more money from the proposed bill? Congress is currently working to get the US bailout approved (PDF). Here’s what’s included: a major extension of the child tax credit, better access to affordable early childhood care, money for services for the elderly and people with disabilities, and an increase in the maximum earned income tax credit for adults, including workers aged.

Until a bill is signed by Biden to become law, none of these provisions are guaranteed and could change at any time. Biden is also expected to include more child and elderly care provisions in a future bill, according to the Washington Post.

Here’s everything we now know about what the plan currently includes in terms of child benefits and older adultsand how your family could see thousands of dollars in tax benefits this year. (We broke all the other ways your family could get more raise money this time around too.)

Beyond a third stimulus check, how much more money could my family receive for my children?

The American Rescue Plan includes several provisions aimed at reducing the rate of child poverty in the United States, which could provide some families with an additional injection of cash this year. These include:

Stimulus checks for dependents. Under the current bill, dependents of all ages (including children, young adults or older adult parents) will be eligible for up to $ 1400 each in stimulus payments. This money will not come in the form of their “own” check, but will instead be added to the household total.

Extension of the child tax credit. Parents can generally claim a CTC of up to $ 2,000 on their taxes for each child under 17. receive a credit of $ 3,600. It also makes the credit fully refundable, removing both the dollar cap and the earnings cap that currently prevents many low-income families with children from receiving full credit, according to the Center on Budget and Policy Priorities. (Click here to learn more about the changes to the child tax credit.)

Expanded tax credits for child care. To make child care more affordable for families, the plan provides a child care tax credit for children under 13 – up to $ 4,000 for one child or $ 8,000 for two children or more. The credit would be refundable and offered to families earning less than $ 125,000 per year. Those earning between $ 125,000 and $ 400,000 would receive partial credit (find out what is your adjusted gross income here). The plan also calls on Congress to provide funding to keep child care centers open and to improve salaries and benefits for educators.

What kinds of money or tax breaks does Biden’s plan include for seniors?

The American Rescue Plan also includes funding for programs designed to financially assist the elderly. These include:

Stimulus search older adults, including dependents. Under the current bill, older people (including SSI or SSDI benefits) would be eligible for a third stimulus control of up to $ 1400, if they meet eligibility criteria. This includes the elderly listed as dependents on someone else’s taxes, although their share of the stimulus funds is added to the total household amount. (Discover all the rules regarding stimulus checks for the elderly.)

Expansion of the earned income tax credit. Designed to benefit low-income people, this tax credit can reduce your taxable income and wages. Biden’s plan proposes to increase this credit for adults without children from about $ 530 to $ 1,500 and increase the income limit of the credit from $ 16,000 to $ 21,000. It would also widen the eligible age range, thus removing the age limit for older workers. And if your income fell in 2021 due to the pandemic, you wouldn’t see your credit cut. (Learn more about how to claim the earned income tax credit this year.)

More funding for services for the elderly and people with disabilities. The American Rescue Plan includes additional funds for senior and disability service programs, but does not specify where exactly that money would go.

Find out more how a third check could make more money for your family, and when the IRS could send the third stimulus check.