Author Topic: Child tax credit changes  (Read 514 times)

zahc

  • friend
  • Senior Member
  • ***
  • Posts: 5,791
Child tax credit changes
« on: June 07, 2021, 11:30:28 PM »
For those unchilded, the federal child tax credit is substantial. Something like $2000/kid per year. So with 3 kids that's $6000/year off my taxes. Not a small amount.

I got a letter from the IRS that instead of giving you the Child Tax Credit when you file taxes, they are going to send you monthly payments instead.

--there is no way to opt out. The letter says there should be a way to opt out by July but right now everyone is going to start getting the monthly payments by default

-- I don't want this because I carefully plan my taxes and now I have to make adjustments to my withholding or else I'll end up with a surprise tax bill.

--in fact, since it's opt-out, it means absolutely every W2 employee with kids will have to go adjust their withholding or they might have a surprise tax bill next year. So great...I get a check from the IRS for $500/mo, but I go adjust my withholding up by $500/mo to send it right back to them. What is the possible benefit of that? Just conditioning people to getting checks from the IRS? It's going to backfire if a bunch of people end up owing taxes next year instead of getting a refund, and not be able to pay it because they spent their tax credit checks already.
Maybe a rare occurence, but then you only have to get murdered once to ruin your whole day.
--Tallpine

PEfarmer

  • friends
  • New Member
  • ***
  • Posts: 76
Re: Child tax credit changes
« Reply #1 on: June 07, 2021, 11:57:42 PM »
There's a little more to it than that, though I agree that opt in would be better. For 2021 only, the ctc is increased to 3000 per spawn, 3600 for under 6 (I think), so there's an increased credit that these monthly payments are working against. But... The monthly payments will exceed the extra 1k credit by 500, so refunds will go down by that much. Like you, I carefully plan my taxes and will be increasing my w2 withholding by 200 per month (2 spawn here) to compensate. Luckily, for fed gov employees, that's super easy.

makattak

  • Dark Lord of the Cis
  • friend
  • Senior Member
  • ***
  • Posts: 13,022
Re: Child tax credit changes
« Reply #2 on: June 08, 2021, 03:43:59 PM »
What is the possible benefit of that? Just conditioning people to getting checks from the IRS?

I wish the Ring had never come to me. I wish none of this had happened.

So do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given to us. There are other forces at work in this world, Frodo, besides the will of evil. Bilbo was meant to find the Ring. In which case, you also were meant to have it. And that is an encouraging thought

cordex

  • Administrator
  • Senior Member
  • *****
  • Posts: 8,570
Re: Child tax credit changes
« Reply #3 on: June 08, 2021, 03:50:57 PM »
They still haven't processed my tax return, but they are already talking about sending checks for next year's tax credits?

MechAg94

  • friend
  • Senior Member
  • ***
  • Posts: 33,622
Re: Child tax credit changes
« Reply #4 on: June 08, 2021, 05:07:33 PM »
They have been using the IRS for backdoor welfare for a while now. 
“It is much more important to kill bad bills than to pass good ones.”  ― Calvin Coolidge