Each tax season, many families in the United States receive additional income through refundable tax credits, among them the Earned Income Tax Credit and Child Tax Credit. These two tax credits can comprise a significant portion of income for the 25 million and 48 million recipients of the EITC and CTC, respectively.
The average EITC recipient, for example, receives a tax refund equal to 12 percent of their annual income. These credits are delivered as one-time payments shortly after individuals file their taxes.
The recently enacted American Rescue Plan both increases the Child Tax Credit and expands eligibility for it as well as the Earned Income Tax Credit. Yet because the rules governing tax credits are often complex, it can be difficult for individuals to figure out howRead More »