Although many things continue to change and evolve as we navigate the coronavirus pandemic, one thing has become ever clearer – preschool is possible! The most recent support and affirmation of this notion… the federal government just passed the American Rescue Plan Act to tackle the financial burden resulting from the pandemic, which includes targeted assistance for families with young children.
Part of this newest legislative relief package includes expanded coverage for child care expenses via federal Child Tax Credits and direct payments to families:
- For calendar/tax year 2021, the annual Child Tax Credit for families with children under the age of 6 has been increased to $3,600 ($300 per month per child) for income-eligible households (earning less than $75,000 up to $150,000 annually). Because the tax credit is retroactive to January 2021, the bill stipulates that qualifying families will be eligible for direct pay-outs in the form of refundable credits and/or advance payments starting July 2021 and extending through December 2021. (see here a link to the official government text of the Child Tax Credit provisions in the American Rescue Plan Act and a shorthand summary of who and how to qualify for the Child Tax Credit in the bill).
- For families with children between the ages of 6 and 17 (previously, 17-year-old dependents did not qualify), the annual tax credit has been increased to $3,000. The same income thresholds apply. Again, see here a link to the official text of the Child Tax Credit provisions in the American Rescue Plan Act and a shorthand summary of how to qualify for the Child Tax Credit in the bill.
- Additionally, the Child and Dependent Care Credit limits have been increased. For the 2021 tax year, working taxpayers can reduce their taxes by claiming up to 50% of up to $8,000 of child care and similar costs for a child under 13, a spouse or parent who cannot care for themselves, or another dependent (and up to $16,000 of expenses for two or more dependents). Here is a link to the official text of the Child and Dependent Care Credit provisions in the American Rescue Plan Act and a shorthand summary how to qualify for the Child and Dependent Care Credit.
These difficult times have put enormous pressure on so many families. Throughout this past year, we are particularly proud of our continued dedication to helping our youngest students grow and learn on-site and in-person SAFELY for the majority of the pandemic period. We combine an engaging curriculum with structured play in a fun, exceptionally safe and nurturing environment creatively adapted for these times. Preschool is the first introduction to a lifetime of learning, a journey that we have been determined to make possible through this unprecedented past year and that we look forward to facilitating for more families as the world steadily returns to normal.