How to claim the new $300 child tax credit in Colorado
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Starting Thursday, most Colorado parents will begin receiving up to $300 a month in payments from the newly expanded federal Child Tax Credit.
Why it matters: A chief policy priority of Colorado Sen. Michael Bennet, the tax credit approved as part of recent stimulus legislation represents what advocates consider the most significant investment in children in decades.
- The tax breaks — $105 billion total — are expected to cut child poverty in half.
How it works: The full tax credit is $3,000-$3,600 for each child, and the IRS is sending half to families early in the form of monthly payments. Parents can claim the other half when they file their 2021 return. (You can opt out of the early payments. Here's why you might want to.)
- For the next six months, parents eligible for the max will get $300 a month per child under age 6 and $250 a month per child between ages 6 and 17.
Who's eligible: The maximum payments will go to 96% of families with children in Colorado, according to Bennet's office. To qualify:
- Couples who file jointly must make less than $150,000 a year
- Single parents must earn less than $112,500
Of note: Married couples with income under $400,000 and single parents who make under $200,000 will qualify for a lesser $2,000 a year in tax credits, or $166 a month, according to the Biden administration.
How to get the money: If you filed 2019 or 2020 taxes, the payments will be automatically deposited into your bank account, or you will receive paper checks in the mail.
- If you did not file taxes, you can visit irs.gov/childtaxcredit2021 to check eligibility and sign up.
Yes, but: The expanded tax break is temporary. Bennet and President Joe Biden are pushing to make it permanent.
- In addition, questions remain about how hard-to-reach families will get the money.
What they're saying: "It's going to provide a measure of economic security for a million families who have been living on the edge for years," Bennet said in a recent call with advocates.
What's more: In tax year 2022 — filing in 2023 — Colorado will offer a state-level child tax credit that'll be a portion of the federal one, which ends after the 2021 tax season.