CLEVELAND — Monday, November 15 is the deadline by which families must apply for the Expanded Child Tax Credit.
The monthly tax credit gives parents $300 per child ages five and younger and $250 per child ages six to 17.
According to Will Petrik, a budget researcher with Policy Matters Ohio, the credit was previously “nonrefundable.” That meant if you didn’t owe taxes, or only owed a small amount, the rest of the credit would not be refunded to you.
“When you think about when you pay taxes, some families get a tax refund. Other families have to pay back,” Petrik said. “And so what refundability means is prior to when the child tax credit wasn't refundable, that tax credit could only go towards tax liability.”
However, the Child Tax Credit (CTC) is currently considered “refundable,” which means the leftover credit would go back to families.
“Basically, over 2.1 million children automatically got opted in, and that's because their parents or caregivers basically claimed them as a dependent on a tax return over the last two years,” Petrik said. “Or they signed up for what's called the Economic Impact Payment. That's like the stimulus checks that have gone out.”
If you haven’t done those things, you’re not yet enrolled. Policy Matters Ohio is urging people to visit GetCTC, where they can enroll by filling out a simplified tax return.
Danielle Marzette of Cleveland is the mother of identical twin three-year-old girls, and she said she initially found out about the CTC back in the summer. She enrolled and said she received two payments.
“It helped me tremendously,” Marzette said. “Obviously, we're going through really tough times right now, so I definitely needed it. It helped me catch up on bills, it helped me feed my children.”
Marzette said she lost eligibility after a couple of payments. She’s not sure exactly why but thinks it may have had something to do with the taxes she owed.
“During the month it cut me off, it kind of put a damper on my finances, so I definitely could use the extra money again,” Marzette said, noting that she plans to see if she’s qualified again at this point.
“If families do miss that [November 15] deadline, basically, they'll need to file taxes next year, and so that will again sign them up for the Child Tax Credit,” Petrik said.
A map on Policy Matters Ohio’s website shows how many thousands of families across Ohio could miss out on money by not enrolling in the CTC.
Petrik said as of the current legislation passed at the federal level, this CTC is only for one year. He added, “Families have to fill out their federal income tax form next year to get the other half of the tax credit.”
“There's pending legislation right now at the federal level, so that Build Back Better legislation that basically President Biden put out a framework, that does include the Expanded Child Tax Credit for another one year, and it makes the refundability aspect permanent. So again, those kids and families with very low wages will be eligible for the additional support,” Petrik said.
Petrik said a lot of research shows families are struggling right now to pay for basics such as housing and food.
“This payment is meant to take stress off families, but it's also something that the research really shows that when kids live in deep poverty, that impacts their growth. It impacts their future opportunities,” Petrik said.
He added, “When kids have the resources to have those basics secure, the food, the housing, you know, a roof over their head, the kids do better.”