New Jersey’s Child Tax Credit Finally Expanded!
Lawmakers in both chambers unanimously approved a bill expanding New Jersey’s child tax credit. Residents with an annual taxable income of $150,000 or less will be eligible for the tax credit. The program’s current cutoff is $60,000.
The new thresholds would see New Jersey filers receive credits worth between 10% and 50% of the federal child tax credit, with the greatest awards for those making $30,000 or less per year.
The federal credit is worth between $3,600 and $3,000 depending on a child’s age. If a taxpayer’s credit under the state program exceeds the total of their income tax bill, they get the difference as a tax refund.
This year, some changes were made to the CTC program. The first is raising the maximum credit amount from $2,000 to $3,000 for children aged five to 18, and raises the credit amount to $5,000 for children under five.
In addition to this, the minimum income requirement has been removed meaning an applicant can still be eligible as long as they have a qualifying child.
To qualify for the 2021 CTC advance payments, you – and your spouse, if you filed a joint return – must have:
- Filed a 2019 or 2020 tax return and claimed the CTC on the return; or
- Given the IRS your information in 2020 to receive the stimulus payment using the Non-Filers: Enter Payment Information Here tool; and
- A main home in the United States for more than half of the year or file a joint return with a spouse who has a main home in the United States for more than half the year; and
- A qualifying child who is under age 18 at the end of 2021 who has a valid Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
A child tax credit is a tax credit for parents with dependent children given by various countries.
The credit is often linked to the number of dependent children a taxpayer has and sometimes the taxpayer’s income level. For example, in the United States, only families making less than $400,000 per year may claim the full CTC.
“Our state is a great place to live, but it is also an expensive place to live. That is why we must work each and every day to make New Jersey more affordable,” said Sen. Troy Singleton, one of the bill’s sponsors.
“The affordability crisis affects us all, especially those families who shoulder the expense of child care.”
Stay updated for more news here at the East County Gazette.