OT: Child Tax Credit “Payment”

[ClemTigsCo]

Here’s the interesting part. My wife and I cleared that in 2020 but we got some today. I’m assuming it’s one of those phase out things?

Correct. I was somewhat mistaken in my original post, for which I apologize.

The FULL credit goes to couples making under $150K. At that point it starts phasing down, until $440K. Above that, you don’t get anything.

I was also slightly off when I said 95% of families w kids will get an expanded credit. That’s the number here in CO. Nationwide it’s slightly over 90%.

My apologies for those errors!

Waiting for your child tax credit payment? Here's who isn't eligible for the $300 check

Up to 96% of US households with children qualify for at least some of the 2021 child tax credit. But age and income requirements could make families completely ineligible.

www.cnet.com

 

[ClemTigsCo]

Dems have mastered the art buying votes using tax payer money, and this country is stupid enough to keep electing them

Reps have mastered the art of giving giant handouts to corporations and the wealthy and then using dishonest scare tactics to convince convince people they’re screwing over to vote for them anyway. And those people are stupid enough to keep voting for them anyway.

 

[ClemTigsCo]

It’s the credit you would normally get as part of your refund or to lower your payment. But now increased and paid monthly. I think.
If you have a child you get it even if 0 income. Supposedly it will dramatically reduce child poverty, and I see how it could in select cases. And if not spent unwisely.

Correct. It is increase, paid (half) in advanced and refundable. It will, in fact, cut child poverty in half while also cutting taxes for tens of Molly of middle class families.

 

[ClemTigsCo]

This. If you don't need it right away you should opt out and you will still get the full amount you qualify for on your 2021 tax returns. Getting it right now can have adverse consequences.

I honesty can't fathom what the government is trying to do. There are people begging for workers. Money is flowing everywhere. No one should need an advance more now than they have in the past. The opposite really.....and the ones taking it early are going to get a smaller refund or owe more money later.

A, the post you’re replying to is incorrect,
B. How out of touch are you? Despite the incredible economic recovery we’re experiencing now (thanks Biden), the economy and most working families are still massively in the hole from the COVID recession. Plenty of families are working hard and still struggling and this will be a massive help,
C. Opting out is incredibly stupid, and only something people with zero understanding of economics would do. It’s giving the government a zero interest loan. Sure, you could claim your extra money in April instead if you want. Or you could take it now and invest it (or just put it in a CD) and make a return on it. No one is telling you that you have to spend it.

 

[ClemTigsCo]

Here's a real world example.

My brother and sister-in-law live outside of Corpus Christi. He works construction and she is a RN at a hospital. Both full-time. They make about $90K per year.

They have one kid. Money is tight but they make it. Recently, their electricity bill has doubled to $450 per month.

They were going to have to make some tough budget decisions but now they can pay their electricity bill.

Both vote straight R and this tax credit will not change that one bit, but my brother is grateful that the Government is helping.

But, but, I was told we’re awash in money so we don’t need this!

Seriously though, this is exactly why we passed this thing.

And I’m happy that it’s helping your bros Ven if he votes straight R.

Though, he should think about how every single R in Congress voted against this help (whole all but about 8 voted for a $1.9 trillion giveaway to the Jeff Bezos’ of the world)!

 

[ClemTigsCo]

Is it really taxable income? How/why does a pre paid tax credit suddenly become taxable income. Only those with an expected income over $400k will have to pay it all back.

I don’t like it because it is one step closer to UBI and conditions people to government payments, but there are also those who complain about giving the government a “free loan” all year where here you get your money back sooner.

It is NOT taxable income. Check out Q10 here

2021 Child Tax Credit and advance Child Tax Credit payments — Topic A: General information | Internal Revenue Service

Frequently asked questions about the Advance Child Tax Credit Payments in 2021 — Topic A: General Information

www.irs.gov

If your CPA says it is, you should fire them immediately.

 

[ClemTigsCo]

It’s taxable income??? Wasn’t that the whole point of this as to be another form of stimmy for the folks that got it before? I thought since it was an expansion of what we normally get in April that it wasn’t going to be taxable? Especially if you’re under the thresholds?

Correct. It is not taxable.

 

[ClemTigsCo]

Can you reconcile your comments with Q A10 on this page?

2021 Child Tax Credit and advance Child Tax Credit payments — Topic A: General information | Internal Revenue Service

Frequently asked questions about the Advance Child Tax Credit Payments in 2021 — Topic A: General Information

www.irs.gov

I believe you when you say you are a CPA (and I’m no expert on this), but the IRS website seems to refute what you are saying. The only adverse consequence is if you have a child whose status would change from last year.

thanks for the help. I am just trying to understand this (and not argue).

Edit: …and I am fully aware that this would decrease one’s refund if they normally get these credits. That’s different from taxable income.

You are exactly correct. If this guy is really a CPA, he is a pretty bad one.

 

[ClemTigsCo]

They are giving based on 2020 tax return. Qualification will be based on 2021 tax return. They don’t know your 2021 income yet. Those exceed the income limit in 2021 will have to pay it back.

This is correct. It’s the one downside of the advance payments and the first legit critique I’ve seen on here.

If you were eligible in 202o but your income changes to become ineligible, then you will have to pay it back (or you’ll get a smaller refund, more likely).

However, you will still have received an interest-free loan from the government.

So as far as down sides go, not too shabby.

 

[ClemTigsCo]

Exactly! This proves yet again the left couldn't give a rats ass about small businesses. And yep, all these people who don't understand will be bitching and whining when they file their taxes that they didn't get as much back without understanding they were advanced half of it already.

How does this say anything about what the left thinks about small businesses?

Btw, here’s a write up of all the help that was passed by “the left” in the American Rescue Plan (along with the expanded child tax credit) without a single GOP vote:

What’s new for small businesses in the American Rescue Plan

Restaurants and venues will soon be able to apply for dedicated grants.

www.vox.com

But Republicans we’re going go to pass a $1.9 trillion giveaway to corporations and the wealthy (which, btw, allowed Amazon to pay zero federal taxes).

This proves yet again that the right only cares about the Jeff Bezos’ of the world and doesn’t give a rats ass about small businesses.

Twice as many companies paying zero taxes under Trump tax bill

The Tax Cuts and Jobs Act lowered the corporate tax rate from 35 percent to 21 percent. In its first year, the number of companies paying no taxes went from 30 to 60.

www.nbcnews.com

 

[ClemTigsCo]

I opted out today. I have to pay every year, so I would rather be surprised how much less I have to pay than receive anything right now. Not rich as some big swinging’ D!cks on the board, but blessed to not need it right now.

I’ll say, the online opt out process where I had to do a biometric scan of my face was unnerving. Sucks that my wife has to do it as well.

Glad you don’t need it.

Sad for you that you never took an Econ class and would rather give the gov a zero interest loan than put the money in a CD or invest it in the market.

If you’re in the business of giving no-interest loans, may I apply?

 

[ClemTigsCo]

I got some though not the whole $600 today. Just threw it into the savings account.

Ding ding ding, we have a winner!

 

[ClemTigsCo]

I don't mean to be an ass here and I know this is honest advice but I just don't get how that would be advantageous unless the government is charging interest for the people over the income limits. Assuming the person wouldn't blow the money (a MASSIVE assumption, but given you're a CPA I would think your clients have some sense) it's at worst a 9 month interest free loan, correct? You could at least put the money in a savings account and get marginal interest and have the liquidity if needed, or am I crazy?

Weird how you know so much more about basic economics than this “CPA”

 

[ClemTigsCo]

It’s obviously too late to opt out and I love to over think shit but riddle me this:

If my child turns 6 in September, how would the gubment treat that? 3 months at $300, 3 months at $250?

You’d probably get six months of $300 and they’d take the $150 out of the second $1650 you’re due next April.

So, think of it as $1650 you get to keep plus an interest free loan of $150.

 

[ClemTigsCo]

This is the correct answer

Actually, no. No it isn’t.

 

[ClemTigsCo]

cant help you. I am libtard communist who makes a shitload if money as a capitalist. I don’t qualify for poor benefits.

Me too. So weird how us commies are so much better at economics than these Ayn Rand wannabes.

 

[ClemTigsCo]

Wait, are you saying it's not "free" money?!!!

This is why we will always have poors

It’s an advance on a newly expanded tax cut.

So weird that all of you Republicans are dead set against a tax cut for middle class and working families.

 

[ClemTigsCo]

What a f’n pain in the ass …

thanks Joe you f’n sentient turnip

Yes, how dare you cut our taxes and let us access that money in advance!!!*

(*the “us” here refers to you).

 

[ClemTigsCo]

Free money, yeah!

All these Democrats do is give and give.

I’ll put the Dems’ free $3000 for middles class over the multiple billions of free money that Reps gave Jeff Bezos any day.

Which do you think was better spent?

https://www.washingtonpost.com/business/2021/06/08/wealthy-irs-taxes/

 

[ClemTigsCo]

Ok. Enough of educating/dunking on you fools. I’ve got kickboxing in 4.75 hours.

For those of you still wondering what to do, just take the money and put it in a CD fir the love of god.

 

[JAMCRACKER99]

I've seen many like this. She'll probably plop out another half dozen. You'll love seeing her Escalade in front of her double wide

No I believe she is done and finally found a good hard working husband who treats her previous four kids like his own and no Escalades.

 

[dposton]

Ok. Enough of educating/dunking on you fools. I’ve got kickboxing in 4.75 hours.

For those of you still wondering what to do, just take the money and put it in a CD fir the love of god.

Dang, hate you’ve got somewhere to be. This thread could’ve really used a couple hundred more posts from you.

 

[clemben]

It's an advance on the Child Tax Credit you WOULD claim in April 2022 when you do your taxes for 2021.

You will not be able to claim this credit in April.

Silly Joe Biden....

Gonna be a lot of pissed off parents come tax time this spring, banking on that big "free interest loan" they get repaid by the gubment every year, only to find out it'd been paid to them in installments the prior six months

This is completely WRONG. The CTC was expanded--it was doubled and to put money in families pockets faster they made it so that you could get it 6 months in advance and then still get the normal amount when you file your taxes.

The govt not only gives families back their tax dollars but figures out how to do it faster and more efficiently as economic stimulus and people complain...this may be the best thing the govt has ever done to strengthen families in my lifetime.

 

[clemben]

It’s taxable income??? Wasn’t that the whole point of this as to be another form of stimmy for the folks that got it before? I thought since it was an expansion of what we normally get in April that it wasn’t going to be taxable? Especially if you’re under the thresholds?

No. CTC funds are NOT taxable income. Never have been and won't be with the advance and the expansion of the CTC this year.

 

[clemben]

Free money, yeah!

All these Democrats do is give and give.

Umm...I'm happy to get back taxes I've paid to govt. Why do people have to make everything Rep and Dem?

This is a middle class tax cut, something R's used to love and push for--remember the Bush tax cut where every household got a 300-600 dollar rebate check?? Same deal--just with a pandemic and more people hurting or with loved ones dead.

If you complain about middle class families getting a tiny bit of scratch back in their pockets then I hope you are up in arms reading about how the top 5 billionaires in this country were able to game the tax system to not only pay no taxes at all but actually make plenty of money from loopholes only they can exploit--propublica has a great report...

 

[clemsonu0219]

This Biden tax cut for working families cost about $100 billion.

Trump’s tax cut for corporations and the wealthy cost $1.9 trillion.

If you really care about the national debt, which is the better deal?

I don’t like Trump man. Why does everyone assume that criticism of a current regime auto assumes I’m in love with the former one.

My second biggest reason for disliking Trump were his fiscal policies.

 

[Howard's Jock]

Ok. Enough of educating/dunking on you fools. I’ve got kickboxing in 4.75 hours.

For those of you still wondering what to do, just take the money and put it in a CD fir the love of god.

man talk about hijacking a thread

 

[1Clemson]

I think that’s what I’m curious about. I gladly take the tax credit when I file. How will this impact that. I haven’t seen that anywhere. Probably haven’t looked enough - so I ask my fellow Tigers hoping there’s a tax pro available.

It will only potentially decrease your future refund or increase any payments you would have made by exactly the same amount received in “advanced payments”. Anyone passing because it will reduce a known or planned large refund is not smart, so tell them anything to get them riled. Those that understand taxes or finance would never give the government an interest free loan so they are probably ok with it (the brightest have already computed the future tax obligation and reduced any withholding or payments to avoid a refund already).

 

[1Clemson]

They are giving based on 2020 tax return. Qualification will be based on 2021 tax return. They don’t know your 2021 income yet. Those exceed the income limit in 2021 will have to pay it back.

So no net impact, other than worst case you were given an interest free loan.

 

[Intracoastal]

A, the post you’re replying to is incorrect,
B. How out of touch are you? Despite the incredible economic recovery we’re experiencing now (thanks Biden), the economy and most working families are still massively in the hole from the COVID recession. Plenty of families are working hard and still struggling and this will be a massive help,
C. Opting out is incredibly stupid, and only something people with zero understanding of economics would do. It’s giving the government a zero interest loan. Sure, you could claim your extra money in April instead if you want. Or you could take it now and invest it (or just put it in a CD) and make a return on it. No one is telling you that you have to spend it.

I'm not out of touch, opting out is not stupid, and I was an econ major at Clemson.

 

[DeathValley_13]

It’s an advance on a newly expanded tax cut.

So weird that all of you Republicans are dead set against a tax cut for middle class and working families.

Not when we've been printing the way we have.

 

[dandeman330]

So no net impact, other than worst case you were given an interest free loan.

Yes, unless you are going to exceed the limits this year in which case you would owe it back on your tax returns.

 

[gardentiger]

Based on my many years of reading this board, if you make less than $150K, you are the 5% on TI.

Lol

 

[WapPride]

What a f’n pain in the ass …

thanks Joe you f’n sentient turnip

i like this and will be co-opting it ty

 

[Intracoastal]

Based on my many years of reading this board, if you make less than $150K, you are the 5% on TI.

I mean it's really not all that far fetched that a lot of people on here make over 150K combined if both spouses are working. Maybe not 95% lol but probably half. That's roughly 75K each. I know that's a lot of money to some people but I would think that it is also pretty common.

I don't think couples making 150K combined are rich/wealthy/etc. They are probably in the upper half of the middle class.

 

[grazhoppa]

You are exactly correct. If this guy is really a CPA, he is a pretty bad one.

Actually, I owe @terrier2tiger an apology…. He was not arguing that this was taxable income (if I reread his post, that’s clear). I connected what he said to several posts that came before him. @terrier2tiger is a good dude. Thanks for answering my question!

 

[scotchtiger]

Umm...I'm happy to get back taxes I've paid to govt. Why do people have to make everything Rep and Dem?

This is a middle class tax cut, something R's used to love and push for--remember the Bush tax cut where every household got a 300-600 dollar rebate check?? Same deal--just with a pandemic and more people hurting or with loved ones dead.

If you complain about middle class families getting a tiny bit of scratch back in their pockets then I hope you are up in arms reading about how the top 5 billionaires in this country were able to game the tax system to not only pay no taxes at all but actually make plenty of money from loopholes only they can exploit--propublica has a great report...

What about those of us who want to fix the loopholes at the top, but think handing out even more money is irresponsible?

A family of 4 making $100K, taking the standard deduction and making a modest IRA contribution pays ~$4K in taxes. Or an effective rate of only 4%. And now we want to give them more money?

Exactly how little do we expect of folks like this who make a decent living? Should we just start paying them a government salary?

 

[PAWrocka]

Yes, how dare you cut our taxes and let us access that money in advance!!!*

(*the “us” here refers to you).

...

Its not a "cut" if you have to pay it back.

Im sure this helps TONS of people and that is good, BUT ...... the default shouldve been that families needed to opt in, versus everyone being enrolled and then going through a process to opt out.

edit: a process that includes, sending the IRS pictures of my drivers Lic (not a big deal, they have it any ways) BUT also providing a video "selfie" for a biometric token, in which a IRS App needed access to my camera phone and I needed to grant access. Not gonna lie ..... I kind of want to get a new phone now.

 

[PAWrocka]

I mean it's really not all that far fetched that a lot of people on here make over 150K combined if both spouses are working. Maybe not 95% lol but probably half. That's roughly 75K each. I know that's a lot of money to some people but I would think that it is also pretty common.

I don't think couples making 150K combined are rich/wealthy/etc. They are probably in the upper half of the middle class.

Here in Maryland ... a joint income of $150k means you and your spouse enjoy Natty Light, Pall Malls, and 10 cent wing night at the local Applebees

 

[SconnyTiger25]

About 95% of American families with children will be getting monthly tax rebate checks of $250 or $300 per child for the rest of the year (couples who make over $150,000 do not receive it, and as one of those families, I'm fine with that).

It's part of the American Rescue plan (which passed with zero Republican votes). Meant to help middle class families who struggled during the pandemic rebound a little faster.

As the previous poster mentioned, if you don't want it, I am sure there are plenty of charities who would be happy to take it off your hands.

View embedded media

Yes it’s called reliance on the government instead of self reliance, it is a form of communism. Fact is our government cannot afford to do this and has no clear strategy to reduce our debt burden.

This is not free money, it will cost much more in the future... kind of like borrowing money for your 300,000 house that costs you over 600,000 by the time you pay off your 30 yr fixed mortgage.