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Michigan families urged to take advantage of expanded child tax credit

steve carmody
Michigan Radio

The push is on to get Michigan parents with children under 17 years old to file their federal tax forms to qualify for an expanded child tax credit. The credit will include children who turn 17 in 2021.

As part of federal COVID-19 economic relief, a child tax credit will provide families with a monthly payment up to $300 per child starting in July, running through December.

Flint mother LaDel Lewis says the money will help.

“I’ll tell ya it was definitely motivating to me to know that families like myself will be able to receive extra income for things that we need,” says Lewis.

The full credit amount is available to individuals who have children and adjusted gross income of less than $75,000 for a single parent, or $150,000 for a married couple filing jointly. The extra benefit will phase out for taxpayers who make more money, and cease for individuals earning more than $95,000 and married couples earning more than $170,000 filing jointly.

The expanded credit will be disbursed monthly through December 2021. The monthly amounts generally will be $250 for older children and $300 for children under the age of six. Families will claim the remaining half of the credit when they file their 2021 income tax return in 2022.

There is no limit on the number of children in a family that can receive the credit, as long as they meet the eligibility requirements around age and income.

Luke Shaefer is a professor in the University of Michigan School of Social Work. He says this tax credit could reduce child poverty by 45%.  Shaefer would like to see the credit extended beyond this year.

“We’re at a precipice right?” asks Shaefer. “This could be a one-time anomaly during an economic and public health crisis or it could be extended and hopefully made permanent and become the kind of lasting change we saw with a program called Social Security.”

Parents will need to file their 2020 tax returns as soon as possible, so the Internal Revenue Service can assess their eligibility for the tax credit.

The federal income tax filing deadline is May 17.

Steve Carmody has been a reporter for Michigan Public since 2005. Steve previously worked at public radio and television stations in Florida, Oklahoma and Kentucky, and also has extensive experience in commercial broadcasting.