There are no two ways around it: childcare is expensive! In many cities, it can cost nearly as much as the mortgage or rent payment, which puts parents in a Catch-22: they have to work to afford childcare, but they need childcare in order to work! Factor in the costs for healthcare coverage, and there’s a ton of financial pressure on parents. This was especially true for families dealing with financial hardships during the COVID-19 pandemic. So in an effort to help, Congress temporarily raised Child Tax Credit payments to working families in the American Rescue Plan Act of 2021.
For tax year 2022, the Child Tax Credit enhancements have been allowed to expire and revert to pre-COVID levels. So let’s focus on the key changes:
It’s important to remember that information surrounding child tax credits can change each year, making it essential to keep up with the current laws, so you know what to expect.
Think you may qualify but have questions about your household’s specific tax situation? After consulting with your tax professional, please schedule some time with our office to review how the Child Tax Credit may impact your financial plan!
Do You Qualify for the Child Tax Credit?
January 20, 2023