Families may expect additional tax relief in the current season through expanded Child Tax Credits if Congress acts promptly.
According to Michigan Advance, The Tax Relief for American Families and Workers Act received substantial support and was approved by an overwhelming margin of 357-70 in the US House last month.
Presently, the bill awaits a vote in the Senate.
In this regard, IRS Service Commissioner Danny Werfel testified before Congress, assuring the tax-writing US House Committee on Ways and Means that the IRS would be capable of timely implementation of the tax credits, enabling taxpayers to benefit during this tax season.
Taxpayers who qualify for the expanded Child Tax Credit will not need to file additional or amended returns for the IRS to implement the changes.
Proposed Expansion of Child Tax Credit
If the aforementioned legislative proposal is approved, it will result in a major expansion of the child tax credit structure by gradually increasing the cap allotted to the refundable component.
Consequently, families with dependent children would stand to benefit from amplified refund amounts.
Specifically, the proposed changes are intended to gradually increase the annual refundable allotments, beginning at $1,800 and continuing to $1,900, eventually reaching $2,000 for each tax year from 2023 to 2025.
The Internal Revenue Service (IRS) is vigilantly monitoring the unfolding developments within the United States Congress with regard to the potential enactment of this substantive legislative measure.
Currently, the timing and likelihood around the bill’s passage are questionable. This lack of clarity makes it difficult to predict if the legislation will be passed in time to meet the looming deadline for filing tax returns for the calendar year 2023, which is set for Monday, April 15, 2024.
