Millions of eligible Americans can claim more stimulus money and a higher tax return this 2022, thanks to major policy changes
The 2022 Tax Return and its Major Changes
All Americans can start filing a tax return as early as January 24, according to the Internal Revenue Service (IRS). However, the Treasury Department sends a warning to everybody that this year might cause more delays in filing or during tax release. It is all because of the ongoing coronavirus pandemic and an underfunded IRS.
Even so, in a published article of the “The US Sun“. Americans are still eager to prepare to file and look out for documents including their W-2 forms and two letters about stimulus and child tax credit payments. All important documents are expected to arrive this month.
Both the stimulus check and the enhanced Child Tax Credit payments allowed by the American Rescue Plan Act were designed to support qualified Americans in 2021 during the COVID crisis.
List of Tax Return and Stimulus Benefits
- Stimulus check – worth $1,400
Millions of eligible Americans still owed $1,400 stimulus money from last year. But today, it becomes possible to claim those unpaid funds. However, the reasons, why some of the Americans were not able to receive their stimulus payment in 2021, are because of family, having a child in 2021, or living abroad.
According to CNBC, thousands of Americans living overseas have received stimulus checks during the pandemic. Moreover, around 9million US citizens live outside the country, according to the Department of State.
- General tax refund – $2,775
In 2021, Americans received on average $2,775 in tax refunds, has an 11% increase from the previous year, according to the IRS. In addition, salaries are expected to increase in 2021, implying that Americans would receive a larger refund this year.
- Child tax credit – up to $3,600
The $1.9trillion American Rescue Act, signed into law by President Joe Biden in March, includes a provision that temporarily boosted child tax credit payments to $3,600. To qualify for the full payments, couples must earn less than $150,000 and single parents who file as heads of households must earn less than $112,500. However, the child tax credit has expired.
From July to December, millions of eligible families received monthly payments up to $300 per child, giving them as much as $1,800. As a result, households who got all those payments will be able to claim the remaining $1,800 on their tax return. However, if you were eligible and did not receive it, then you will be able to claim the whole $3,600 on your tax return.
Non-filer who failed to sign in time or mistakenly opted out over fears you could owe the IRS money due to a filing or income change which is the reason why you may not able to receive the monthly child tax credit payment.
- $8,000 Child care and dependent credit
The child and dependent care tax credits were part of the provision that was expanded under the Rescue Act. However, it is not the same with child tax credit payments that have been paid out in monthly installments. The care credits are intended to assist working families in offsetting expenses when financially providing for a child.
If the adjusted gross income (AGI) is $125,000, you can claim the maximum expenditure rate. Once that figure is exceeded, the credit percentage rate starts to phase out from 50%. Specifically, families with more than one child who spends $16,000 in qualifying costs will be eligible to claim care credits of up to $8,000.