My daughter is disabled and her solely revenue is SSI. Her 6-year-old son can also be partially disabled, having autism and ADHD. Can she benefit from the brand new baby tax credit score that begins in July? If she will, how does she file her 2020 taxes since she has no revenue aside from her SSI?
Sure, it appears like your daughter will qualify for the expanded baby tax credit score. Usually, to qualify for the kid tax credit score, you want at the least $2,500 of earned revenue, which is mainly cash you earn by working.
However in 2021, the foundations are totally different. You don’t want earned revenue to qualify for the credit score. So so long as your daughter can declare your 6-year-old grandson as a dependent for tax functions — which means she offers greater than half of his help — she ought to qualify for that cash, though Supplemental Safety Earnings (SSI) is her solely revenue supply.
Because the mother or father of a kid between the ages of 6 to 17, she needs to be eligible for $250 starting July 15 and persevering with by means of December. Then, she’ll obtain the opposite $1,500 of the $3,000 credit score at tax time subsequent yr.
To be on the protected facet, your daughter ought to file a tax return though she’s not required to. You’re allowed to submit one even for those who don’t have taxable revenue. The simplest approach to take action is to make use of a free tax submitting software program. Your daughter might want to enter each her personal Social Safety quantity and her son’s. For revenue, she will merely enter $1. The IRS could reject it as a clean return if she enters it as $0. Offering her checking account and routing numbers for direct deposit will assist her get the fee as quickly as potential.
In case your daughter obtained the three stimulus checks which have gone out since April 2020 and obtained funds on behalf of her son, the IRS most likely has the knowledge it must get your daughter that cash.
However as of June 1, the IRS was urging individuals to file their 2020 tax returns ASAP to ensure they get the credit shortly. So till we get additional directions, I’d go forward and file because it’s free and solely takes a couple of minutes.
Robin Hartill is an authorized monetary planner and a senior author at The Penny Hoarder. Ship your tough cash inquiries to [email protected].