Economic Stimulus Act Will Be the Only Reason Behind Americans Receiving Tax Refund Up to $5,000
It is possible that those who welcomed a new baby into their family in 2021 will be eligible to get a tax refund of up to $5,000 this year.
This is due to two tax credits included in the $1.9 trillion aid package put into law by President Joe Biden in 2021.
According to Andy Phillips, director of the Tax Institute at H&R Block, parents who fulfill the eligibility standards would receive $3,600 in tax relief thanks to an enlarged child tax credit, as well as a $1,400 stimulus check for their dependent children.
Families who qualify can list their newborns as dependent on their taxes this year and receive both the child tax credit and the stimulus check as long as their baby was born by the end of 2021, and they file their taxes by that date.
The $1,400 stimulus check was already distributed to many families, but because the payments were an advance on a 2021 tax credit, eligible parents can collect the payout for their newborn this year when they file their taxes.
The start of tax season is set for January 24. Parents should also keep a watch out for a letter from the Internal Revenue Service (IRS) providing key information about the child tax credit so that they can ensure that their return is accurate.
