Thanks to last spring’s so-called $1.9 trillion “US bailout” legislation, 2021 has been the year of stimulus checks. Last year, millions of Americans, for example, received more than half a dozen stimulus checks — from the federal government alone, not to mention similar payments available at the state level. The first included six monthly Child Tax Credit checks, which deposited hundreds of dollars into Americans’ bank accounts between July and December.
Democrats have been unable to muster support for an extension of those monthly child tax credit checks this year. But that doesn’t mean the door has been closed on this benefit. On the contrary, last year Congress implemented this benefit in the form of a cash advance payment of half a tax credit. Lest it sound unnecessarily complicated, does all of this mean the Child Tax Credit money you received last year? It’s actually only half of what you were actually approved for.
Child Tax Credit Boost 2021
The other half is available this year, in the form of a credit that you will claim on your federal income tax return. It is important to note that recipients of last year’s child tax credit can do so now. Since the tax filing season for 2022 is underway.
One thing to point out, again: this is not new stimulus money you can claim. This is simply a deferred benefit from last year. When Congress rushed to pass the massive stimulus bill in the early months of the Biden administration, remember lawmakers structured the money as a tax credit. But it was too late to apply it in the form of a tax credit linked to last year’s tax returns. So they programmed the credit for 2022.
But the economic devastation associated with the pandemic was still very acute at the time. So the stimulus bill offered a workaround that gave recipients some of the money they were owed earlier. In the form of advance payments.
Additional IRS Details
In an announcement this week detailing the start of this year’s tax season, the tax agency noted an additional point along those lines that people should be aware of. “By law, the IRS cannot issue refunds involving the earned income tax credit or the additional child tax credit until mid-February, although eligible individuals can file their returns from of January 24.”
It’s not just the Child Tax Credit that people can claim on this year’s tax return. If you didn’t receive some or all of the third stimulus check in 2021, usually for $1,400?
The salvage rebate credit is the mechanism you will use on your return this year to correct this. And you can read more about this credit here. This year’s tax return is also where other people will get stimulus money back, like people who gave birth to new dependent children in 2021. What the IRS wouldn’t have immediately known last year – and therefore, could not have issued more children the tax credit money for.
Also note: This year, 2021 tax returns — as well as requests for extensions to file and pay any taxes owing — must be submitted to the IRS by Monday, April 18 for most taxpayers. Normally April 15 would be the date. But there is a federal holiday on that day this year (a Friday), which pushed the date back to Monday, April 18.
Notice, we said “most” taxpayers above. According to the IRS, “Taxpayers in Maine or Massachusetts have until April 19, 2022 to file their returns due to the Patriots Day holiday in those states. Taxpayers requesting an extension will have until Monday, October 17, 2022 to file their case.