Should Parents Wait To File Their Taxes Until The Senate Decides On The New Child Tax Credit?
Go ahead and get your W-2s ready.
The child tax credit is one of those deductions that you know automatically applies every tax season when you list your children as dependents, but all of the back-and-forth over the last few years on how much it should be, how people should receive it (in a lump sum with your tax refund or spread out over a few months), and if it’s still the same thing year after year is a bit much. This year, a bipartisan tax bill is hoping to expand the child tax credit and make the deductions higher for low-income families. At least half a million children would be lifted out of poverty entirely, and about 5 million children who remain below the poverty line would benefit.
On Jan. 31, the bill officially passed the House of Representatives and is heading to the Senate for a vote. But what does that mean for this tax season?
Should you wait to file your taxes until the child tax credit expansion clears the senate?
In a recent press call, IRS Commissioner Danny Werfel very plainly said no, you shouldn’t wait to file just because this bill is up in the air. “We urge and encourage taxpayers to file when they’re ready. Don’t wait on congress,” Werfel said, according to CNBC. Regardless of if the bill passes or not, if there is a change to your refund or your deductions are different than what was originally filed, the IRS will make amends without you having to redo your taxes or find the mistake yourself.
So just go ahead and file your taxes as soon as you’re ready. There’s no guarantee anything will change as the bill makes its way to the senate, and the average tax cut for 2023 is around $680 if the bill passes, which is something the IRS can handle once the decision is made.
This new child tax credit bill is known as The Tax Relief for American Families and Workers Act, and it will “increase the child tax credit incrementally over the next three tax years, with families being able to claim $1,800 per child on their 2023 taxes, $1,900 in 2024, and $2,000 in 2025.” This bill, if passed, will help the lower 40% of the country receive deductions that they normally wouldn’t have, reported CBS.
The deadline for filing your 2023 taxes or requesting an extension is Monday, April 15, 2024.
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