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On Monday, the Biden administration released a statement announcing that 90% of American families will automatically receive relief as a part of their new child tax credit program. According to CNBC, most parents of children age 17 and under are able to receive up to $300 a month from the IRS starting this July.
The child tax credit program will be one of the first initiatives to come from President Joe Biden’s American Rescue Plan, signed last March. CNBC reports that parents are eligible to receive a maximum child tax credit of $3,600 for children five and under, and $3,000 for those between 6-17.
According to CNBC, the payments will go out monthly and be sent out as a 2021 tax advance. That means parents of children under six can receive up to $300 per month, and parents of children under 18 can get up to $250.
The amount of relief received will depend on income, similar to stimulus payments. According to CNBC, families are eligible for the maximum credit if they filed individually with an adjusted gross income of $75,000, or if married couples files with less than $250,000.
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Parents who have a higher adjusted gross income are also eligible for relief but will receive a smaller tax credit. According to CNBC, the IRS claims that most families will automatically receive the payments, as they’re using 2020 tax return information to determine eligibility. 2019 returns will be used if no 2020 information can be found.
“With today’s announcement, about 90% of families with children will get this new tax relief automatically, starting in July,” Biden
said in Monday’s statement. “While the American Rescue Plan provides for this vital tax relief to hard working families for this year, Congress must pass the American Families Plan to ensure that working families will be able to count on this relief for years to come.”Child tax credit payments will be sent out starting July 15.