2024 Tax Refunds: IRS pledges swift action on Child Tax Credit

According to published article of fingerlakes1, The focus of Werfel’s pledge centers around the expanded child tax credit proposed in the Tax Relief for American Families and Workers Act which has already passed the U.S. House but is currently experiencing delays in the Senate. Despite this hold-up the IRS is gearing up to act swiftly once the bill receives approval, with the aim of minimizing the time between enactment and the payout of refunds. Werfel has indicated a window of six to 12 weeks for implementing changes post-enactment, emphasizing a goal to lean towards the shorter end of this timeframe. This readiness underscores the IRS’s dedication to promptly supporting American families by ensuring timely access to financial relief. Key enhancements of the child tax credit under the new act include a revised calculation method that could significantly increase the refundable amount per child for the tax years 2023 to 2025. Specifically the legislation proposes raising the maximum refundable credit to $1,800 for 2023, $1,900 for 2024, and $2,000 for 2025, up from the current $1,600 per child. Additionally for the tax years 2024 and 2025, the bill allows taxpayers to base their child tax credit on the previous year’s earned income if it was higher providing a potential financial cushion for families experiencing income fluctuations.