The American Rescue Plan was signed into law on March 11, 2021. It is aimed at helping taxpayers through the pandemic.
- 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 2020-2021 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.