Haven’t filed your 2020 taxes yet? Here are 3 reasons why you should file now.
Stimulus checks are still front page headlines. Did you know you may qualify for more through the Child Tax Credit Program?
According to current law, a person must be a U.S. citizen with a social security number and not dependent on another taxpayer to receive a stimulus check. Individuals are also subject to the following adjusted gross income thresholds:
- Married Filing Jointly (MFJ): $150,000
- Head of Household (HOH): $112,500
- Single (S): $75,000
The Coronavirus Response and Relief Supplemental Appropriations Act of 2021 signed by then President Trump provided additional stimulus relief funds up to $600. Those with child dependents age 16 or younger were eligible to claim an additional $600 per child.
In March, President Joe Biden signed the American Rescue Plan. This gave stimulus benefits for those who file taxes based on their filing status and amount of dependent children. The amounts were $1400 for Single and Head of Household, $2800 for Married Filing Jointly, and an additional $1400 per dependent child.
If you haven’t filed your 2020 taxes yet, you could still be eligible to receive up to $20,000 in federal aid once you file.
Claim your stimulus checks
The government uses the information filed on your 2019 or 2020 tax return (whichever was the most recently filed) to determine your eligibility for stimulus relief. If you have not filed your taxes for these years and have not opted in to receive relief through the non-filer’s sign up tool with the IRS, you will not be considered for any future stimulus payments. You should file your tax returns as soon as possible to become eligible for any possible federal aid through this relief program.
Once you file your 2020 taxes, you’ll be able to claim previous stimulus aid that you were eligible for and to automatically receive any future payments.
Receive Child Tax Credit payments
Recently, President Biden announced additional economic relief for parents through the Child Tax Credit Program, which will begin phasing out on July 15th. Those who fit the adjusted gross income restrictions mentioned above and have qualifying children are eligible to receive $3,000 per child between the ages of 6-17 and $3,600 for each child under the age of 6. Parents will still be eligible to claim previous stimulus relief by filing taxes from previous years.
Advance Child Tax Credit payments will be distributed monthly starting on July 15, 2021, which is an incentive to file your taxes now, as you will not have to wait until the end of the year to start receiving payments.
Avoid paying more in interest in penalties if you file now
If you owe taxes that you haven’t paid yet, you’re accumulating more interest and penalty fees the longer you wait to file. Additionally, if you’re due for a refund, you will not be penalized for filing late. If you cannot afford your taxes, the IRS has information available at IRS.gov.
If you or anyone you know could benefit from Biden’s recent announcements by filing their 2020 tax returns, our tax team at rebel Financial is here to help. Contact us at firstname.lastname@example.org or schedule an appointment to chat with an advisor about how you could benefit from filing your 2020 taxes. Or enroll now to get started.