Child Tax Credit: Tool opens for poorer families to claim tax benefits without filing a full return
Millions of families who weren’t required to file a full federal tax return but are still eligible for the Child Tax Credit or missing stimulus payments from last year can finally claim those tax benefits starting this week.
The GetCTC tool, a free-to-use portal accessible via GetCTC.org, has reopened for the second year in a row on Wednesday. The portal allows low- and no-income families to claim those tax rebates without having to file a full tax return.
Without it, many families would miss out on much-needed generous benefits from the government.
“Through simplified filing via the GetCTC portal, we were able to reach about 115,000 families [last year] that successfully were able to claim tax benefits and missing stimulus payments,” David Newville, senior program director for tax benefits for nonprofit Code for America, which created the portal, told Yahoo Money. “Approximately, $440 million in tax benefits were collected within ten weeks last year, which is a lot of money in a short period of time. Still, we know we can reach more families.”
The user-friendly GetCTC tool was first launched in September 2021 in collaboration with the White House and Treasury Department and is accessible on desktops and mobile devices, in both English and Spanish. This year, Code for America is also unveiling new actions to reach non-filers in underserved communities.
“We’re launching again this year, and not only have we improved the tool, but we’re also improving our outreach and figuring out how to best target families and make sure they are aware of the tool they can easily use and trust,” said Newville. “Our partnership with the Treasury, White House, and IRS on this makes sure we eliminate as many barriers as possible and use all the most effective channels for each and every family.”
Low-income American households are often at risk of missing out on tax benefits because they don’t file. Data from Urban Institute shows that one in four families with children under 18 and incomes twice below the poverty level ($22,000 for a three-person household) don’t plan on filing a tax return. That number jumped to 14% for families who didn’t receive the advance payments last year, according to the Tax Policy Center.
Who can use the GetCTC tool
The GetCTC tool is available for households that aren’t required to file a full tax return because they have little to no income.
Through simplified filing, low-income families can file basic information with the Internal Revenue Service to receive tax benefits without reporting their income or collecting tax documents. However, due to Treasury regulation, access to these online forms through GetCTC and IRS Non-filer wasn’t available until this year’s tax season concluded on April 18.
This year, eligible families can use GetCTC to receive the 2021 Child Tax Credit, expanded last year to $3,600 per child 5 and under and $3,000 per child 6 to 17. Families that didn’t receive the advanced payments last year will receive the entire CTC when they file through GetCTC.org, according to Code for America.
Eligible households can also use the tool to claim the third stimulus payment — worth $1,400 per family member — which were originally distributed in March and April of last year, said Newville.
“The target audience for this tool is the typical non-filer. If they're single, their income is usually roughly below $12,500. If they're married filing jointly, it's like a little over $25,000,” Newville said. “A lot of these people are unfamiliar with the tax system and may fear the IRS and making a mistake. With scams out there, a lot of these folks are afraid of being taken advantage of by bad actors — but we want to let them know that GetCTC is a really simple, easy-to-use tool — and this is money [tax benefits] that you rightfully deserve.”
Additionally, the enhanced Child Tax Credit and simplified filing will be made available for Puerto Rican families for the first time this year. According to Newville, Code for America will be working on expanding the GetCTC tool in the couple of next weeks so Puerto Rican residents can get the tax benefits they have missed out on.
“Puerto Rico is one of our top priorities,” senior advisor to the President of the United States, Gene Sperling, told press during the White House launch of GetCTC. “It is challenging, it is not perfect because it’s the first time ever. But we will make a big difference and we are working with non-governmental organizations and local governments to smooth over whatever issues we have and stay at it. It is a very high priority.”
Code for America to work with state benefit agencies
While the GetCTC reached thousands of households last year, the nonprofit also recognized that more work needed to be done to help underserved communities get the tax benefits they deserve.
According to Newville, Code for America is “doubling down” on one the most effective channels for reaching people – which is by partnering with state benefit agencies or social service agencies.
Benefit agencies are trusted sources that help individuals access government benefit programs for healthcare, food, and basic housing expenses. Despite these efforts, a quarter of public beneficiaries may be missing out on tax benefits, according to California Policy Lab.
Newville told Yahoo Money that many of these families do not know the CTC is available to them or are unsure how to access the aid.
“The other danger is if you're not really paying attention to the day by day in Washington, DC, about the future Child Tax Credit, you may think there’s no more Child Tax Credit,” said Newville. “So a lot of people who filed last year may believe they don’t need to file this year because there’s talk that the credit is gone – but they are wrong. You can still get the second half.”
Gabriella is a personal finance reporter at Yahoo Money. Follow her on Twitter @__gabriellacruz.
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