School Views: A tax reminder for our families
In the blink of an eye, we find ourselves moving from February to March. As we all know, April showers will follow and just like every other year, April also brings the tax collector.
These past few years we have seen various stimulus checks from our federal government and they come with certain tax implications. While I am far from an accountant, the IRS recently shared information that is pertinent to pass along. As always, I would recommend you consult a professional with specific questions, but hopefully you will find this information valuable.
One pressing question that has come up in regards to filing one’s 2021 taxes is in regards to the advances that many people got on their child tax credit over the course of the previous year.
Children must have a social security number to be eligible for the credit. Parents are not required to have a social security number, but they must have an individual taxpayer identification number o claim the tax credit for their eligible children. Additional details about the child tax credit for families of mixed immigration status can be found at the the Center for Law and Social Policy website.
When you file your 2021 tax return during the 2022 tax filing season, you will need to compare:
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The total amount of the advance child tax credit payments that you received during 2021 with the amount of the child tax credit that you can properly claim on your 2021 tax return. If the amount of your child tax credit exceeds the total amount of your advance child tax credit payments, you can claim the remaining amount of your child tax credit on your 2021 tax return.
However, if you received a total amount of advance child tax credit payments that exceeds the amount of child tax credit that you can properly claim on your 2021 tax year, you may need to repay to the IRS some or all of that excess payment.
You should have received a letter from the IRS in January that will provide the total amount of advance child tax credit payments that were disbursed to you during 2021. You can use this letter to reconcile the tax care credit and determine whether or not some of those funds will need to be paid back or not.
Keep in mind that if you did not receive any advanced child tax credits you will be able to claim the full amount that you are eligible for on your 2021 taxes. And if you welcomed a new child in 2021, then you may also be eligible to receive the recovery rebate credit along with the child care credits.
The IRS has a trove of information available on their website which can be found at IRS.gov and again, there are many tax professionals throughout our community who would be able to assist you in filing this year’s taxes.
Philip Qualman is the superintendent of Eagle County Schools. Email him at email@example.com.