The IRS published new guidance for residents of Puerto Rico on May 6 on how to file and claim Child Tax Credit payments that were approved by the American Rescue Plan Act.
The announcement comes as the Biden administration relaunches efforts to reach out to families across the United States whose incomes were below the threshold to file federal taxes.
As part of those efforts, the White House partnered with nonprofit organization Code for America to reach Americans eligible for the credits via email, mail, and text messages.
A New Portal
Code for America worked with the White House and the Treasury Department to create a free online portal for Americans with children who did not file tax returns. The portal can be found at www.GetCTC.org and www.ChildTaxCredit.org.
The tool was first launched in the fall of last year, and over 115,000 families successfully used the portal to claim $440 million worth of tax benefits. However, the tool was not available during tax filing season.
IRS Commissioner Chuck Rettig stressed the importance of Puerto Rico residents claiming the tax credits that they are fully entitled to under President Joe Biden’s flagship COVID stimulus package.
“It’s important for residents of Puerto Rico to know that starting with Tax Year 2021, having only one child qualifies you for the Child Tax Credit,” Rettig said.
Under the American Rescue Plan Act, the $2,000 Child Tax Credit was increased to $3,600 for children ages 5 and under in 2021 and $3,000 for children aged between 6 and 17 in 2021.
How to Claim
If you’re a resident of Puerto Rico, you’ll need to file your 2021 federal tax return.
Residents who did not earn enough to file federal taxes may still claim the child tax credit, whether in Puerto Rico or the mainland USA.
By making the credit fully refundable, the American Rescue Plan act allows citizens to claim the full credit for 2021 even without paying income taxes or U.S. Social Security taxes.
The credit can then be claimed using Form 1040-PR, Form 1040-SS, US Self-Employment Tax Return, Form 1040, US Individual Income Tax Return, Form 1040-SR and US Tax Return for Seniors.
Residents can claim the credit until April 15, 2025 – the same deadline for all other U.S. taxpayers.
Are You Eligible?
Married couples filing their taxes jointly will be eligible for the tax credit so long as their income is below $400,000.
Single tax filers and those filing as a head of household will qualify with income below $200,000.
Jack Buckby is a British author, counter-extremism researcher, and journalist based in New York. Reporting on the U.K., Europe, and the U.S., he works to analyze and understand left-wing and right-wing radicalization, and reports on Western governments’ approaches to the pressing issues of today. His books and research papers explore these themes and propose pragmatic solutions to our increasingly polarized society.