Chances of another stimulus check from the federal government are very slim. There is, however, one group that might be entitled to more money, and it is the parents of newborns. This coronavirus stimulus check for parents of newborns won’t come this year, rather, eligible parents would get it next year.
In March, Congress approved the American Rescue Plan, which offered $1,400 to adults making less than $75,000 (couples earning less than $150,000). Also, the stimulus package promised $1,400 stimulus checks for dependents.
Since these payments were a type of advance credit for the year 2021, parents who had a baby in 2021 would be eligible for the $1,400 dependent payment as well. However, they can only claim the payment after filing their 2021 tax return next year.
So, once you file your tax return next year (and inform the IRS about the new child), the agency will automatically send you the coronavirus stimulus checks for parents of newborns, if you are eligible. Thus, even for parents who don’t usually file taxes, it is important to file taxes in order to claim the $1,400 payment.
If the IRS has your bank account details, you will get the coronavirus stimulus checks for parents of newborns through direct deposit. Otherwise, you will get the payment through a check in the mail.
You Can Also Claim Child Tax Credit
A point to note is that the coronavirus stimulus checks for parents of newborns will be in addition to the expanded child tax credit program. So, if you haven’t yet informed the IRS about the new child, then by filing your tax return next year, you could also get the expanded child tax credit.
Along with offering $1,400 stimulus checks, the American Rescue Plan expanded the child tax credit as well. The child tax credit amount was increased from $2,000 to $3,600 for kids below 6 years and to $3,000 for kids between 6 and 17 years.
Also, the American Rescue Plan changed the way how families get the child tax credit. Under the new program, the eligible families get half of the credit amount in six monthly installments, from July through December. Families will get the other half after they file their tax return next year.
So, parents of newborns who haven’t informed the IRS about the child, will likely get the full credit amount when they file taxes next year. For more information on the stimulus payments, you can visit this link.
This expanded child tax credit program is for a year only, but talks are ongoing to make it permanent. President Joe Biden also supports making the expanded CTC payment permanent. Meanwhile, a budget resolution proposes to extend the current child tax credit program through the 2022 tax year.