How did the 2021 American Rescue Plan Act Change the Child Tax Credit? Q.How did the 2021 American Rescue Plan Act Change the Child Tax Credit? A.For 2021, the child tax credit provided a credit of up to $3,600 per child under age 6 and $3,000 per child from ages 6 to 17. If the credit exceeded taxes owed, families could receive the excess amount as a refund. From July 2021 to December 2021, half of the credit was automatically paid on a monthly basis to most families in advance of their filing a tax return. Families could opt out of advance payments. Read more about How did the 2021 American Rescue Plan Act Change the Child Tax Credit?
What are tax credits and how do they differ from tax deductions? Q.What are tax credits and how do they differ from tax deductions? A.Credits reduce taxes directly and do not depend on tax rates. Deductions reduce taxable income; their value thus depends on the taxpayer’s marginal tax rate, which rises with income. Read more about What are tax credits and how do they differ from tax deductions?
Do immigrants pay taxes? Q.Do immigrants pay taxes? A.Yes – immigrants of all legal statuses in the US pay federal, state, and local taxes. Read more about Do immigrants pay taxes?