New Parents Can Get a $5,000 Refund. Here’s How.
If you or someone you know is a new parent, listen up!!
New parents can get a $5,000 refund and you’ll want to know all about this before filing your taxes this year!
What Is The $5,000 Tax Refund for New Parents?
The tax refund is part of the enhanced child tax credit of 2021. It is a one-time benefit payout to parents. While the credit is typically available to parents every year, parents whose children were born in 2020 were able to claim the credit.
The credit has now be expanded to include parents who had children born by the end of 2021 and now those parents will also be able to claim the credit.
Who Is Eligible for The $5,000 New Parent Tax Refund?
The main requirement just like before is an income threshold. For you to claim the tax credit, you must have made less than $75,000 if filing as single or $150,000 if filing jointly.
New parents will be able to receive up to $5,000 this year based on last year’s taxes through the 2021 recovery rebate credit.
The full benefit of the child tax credit for last year is $3,600 for children aged 6 and under, including newborns. Another $1,400 can be claimed through the rebate credit for dependent children — meaning you can claim your newborn for this credit as well — bringing the total to $5,000.
The $1,400 was the 3rd stimulus payment you received for your children in 2021 so parents who had a baby in 2021, now get to claim that credit and receive $1,400 for each child they gave birth to in 2021.
How do you get this $5,000 refund?
In order to receive these credits (which may end up being refunds), you must file your taxes as soon as possible for the 2021 tax year.
You also need to ensure that you claim your newborn as a dependent, even if the baby was born in late 2021.
If you don’t claim this credit soon, you may not receive it. The enhanced child tax credit is not permanent and will revert back to its $2,000 maximum in 2023, concerning the 2022 tax year.
So, don’t delay and get those taxes filed because if you had a baby in 2021, you are looking at some additional money this year.
