The American Rescue Plan (3rd Stimulus, Child Tax Credit, Dependent Care Credit, Earned Income Credit and Unemployment updates)

The American Rescue Plan was signed into law on March 11, 2021. It is aimed at helping taxpayers through the pandemic.

American Rescue Plan features:

• The third stimulus payment is worth $1,400 per qualifying individual. Dependents can also receive the full $1,400, no matter their age. 
• Individuals who received unemployment in 2020 will not be taxed on their first $10,200 of unemployment benefits.
• The Child Tax Credit for 2021 increased to $3,000 for kids age 6-17. The credit amount is $3,600 for kids under age 6.  
• The Earned Income Tax Credit for single taxpayers nearly doubled. The minimum age to claim the EITC was lowered to 19. 
• The Child and Dependent Care Credit increased to 50% of expenses. Eligible filers can claim up to $8,000 for one child or $16,000 for more than one child. The credit will be refundable for 2021.  

For the latest information about the American Rescue Plan, please visit our Blog.