New Child Tax Credit Boost: American Rescue Plan- $3,600 with Bonus

In response to the economic fallout of USA from the COVID-19 pandemic, the American Rescue Plan has emerged as a hope for struggling families across the United States. With Different provisions, one stands out for its potential to significantly impact the lives of millions People, the enhanced Child Tax Credit (CTC).

This article delves into the details of this transformative initiative, exploring how it works, who stands to benefit, and its broader implications for society.

Understanding the American Rescue Plan

Enacted in 2021, the American Rescue Plan represents a landmark piece of legislation aimed at addressing the multifaced challenges emerged by the pandemic. With a price tag of $1.9 trillion, it stands as the largest economic stimulus package in U.S. history. At its core lies a commitment to providing direct financial relief to individuals and families grappling with the fallout of widespread job losses, business closures, and economic instability.

Key Features of the Enhanced Child Tax Credit

Central to the American Rescue Plan’s agenda is the enhancement of the Child Tax Credit. Previously set at $2,000 per child, this credit has been boosted to $3,000 per child for children over the age of six, and to $3,600 per child for those under six.

Additionally, eligible families will receive a $600 bonus as part of the package, providing further relief to those in need.

CountryUnited States of America (USA)
DepartmentInternal Revenue Service
ProgramAmerican Rescue Plan
Form for Claim CTCForm 1040 (Schedule 8812)
Child Tax Credit Amounts
Old Child Tax Credit$ 2,000 per Child
New Child Tax Credit (2023)
If Age of Children under 6 Year Old$ 3,600 per Child#
If Age of Children above 6 Year Old$ 3,000 per Child#
# Eligible Families also Receive a $ 600 bonus

Impact on Low-Income Families

The enhanced Child Tax Credit holds major implications for low-income families, many of whom have been adversely affected by the economic downturn.

By increasing the amount of financial assistance available to these households, the American Rescue Plan aims to control financial strain and mitigate the risk of poverty among children. With monthly payments disbursed to eligible families, the credit serves as a lifeline for those struggling to make ends meet.

Eligibility Criteria

To qualify for the enhanced Child Tax Credit 2023, individuals must meet certain criteria outlined in the American Rescue Plan.

This includes Following,

Your dependent(Child) generally must be

  • Be under age 17 at the end of the year
  • Be your son, daughter, stepchild, eligible foster child, brother, sister, stepbrother, stepsister, half-brother, half-sister, or a descendant of one of these (E.g.., a grandchild, niece or nephew Etc.)
  • Provide no more than half of their own financial support during the year
  • Have lived with you for more than half the year
  • Be properly claimed as your dependent on your tax return
  • Not file a joint return with their spouse for the tax year or file it only to claim a refund of withheld income tax or estimated tax paid
  • Have been a U.S. citizen, U.S. national or U.S. resident alien

Importantly, You qualify for the full amount of the 2023 Child Tax Credit for each qualifying child if you meet all eligibility factors and your annual income is not more than $200,000 ($400,000 if filing a joint return).

with exception to above, Parents and guardians with higher incomes may be eligible to claim a partial credit.

Administrative Mechanisms

The Internal Revenue Service (IRS) plays a pivotal role in administering the Child Tax Credit, overseeing the distribution of payments to eligible families. Through a combination of automated processes and manual interventions, the IRS also ensure that funds are delivered promptly and accurately to those in need.

Taxpayers need not take any additional steps to claim the credit, as it is automatically provided to eligible individuals upon filing their tax returns. (Form 1040, Schedule 8812)

Broader Socioeconomic Implications

Beyond its immediate impact on individual families, the enhanced Child Tax Credit carries broader socioeconomic implications for society as a whole.

By lifting millions of children out of poverty and reducing financial stress on households, the credit will impact greater economic stability and resilience.

Moreover, by investing in the well-being of future generations, it lays the foundation stone for long-term prosperity and social bond.


As the United States continues to fight with the far-reaching effects of the COVID-19 pandemic, initiatives like the enhanced Child Tax Credit offer a great hope amidst uncertainty. By providing critical financial support to families in need, the American Rescue Plan reaffirms the government’s commitment to promoting equity, opportunity, and resilience for all. As we navigate the challenges ahead, let us seize the opportunity to build a brighter, more inclusive future for generations to come.

Frequently Asked Questions

How much is the enhanced Child Tax Credit under the American Rescue Plan?

Under the American Rescue Plan, the Child Tax Credit has been increased to $3,000 per child for children over six years old, and $3,600 per child for children under six, with an additional $600 bonus.

Who qualifies for the enhanced Family Support?

Parents living in the United States with children under the age of 17 may qualify for the enhanced Family Support if they meet certain eligibility criteria outlined in the American Rescue Plan.

Are the enhanced Child Tax Credit taxable?

No, the Child Tax Credit payments received under the American Rescue Plan are not taxable income. They are considered tax credits and do not need to be reported as income on tax returns.

What form is used to claim the Child Tax Credit?

Taxpayers can claim the credit using Form 1040, with fill details in Schedule 8812.


USA IRS article on Child Tax Credit

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