President Joseph R. Biden Jr. announced on Monday that about 90% of American families with children will get the new tax relief from the American Rescue Plan automatically starting in July.
Parents do not need to do anything as the Internal Revenue Service will start delivering a monthly payment of $300 per child under 6 and $250 per child older than 6 for those who qualify, starting July 15, until the end of the year.
The money will be deposited directly into families’ bank accounts on the 15th of each month or the date closest to that date, if 15th falls on a weekend or holiday.
A family with three children aged 3, 4 and 5 will receive $900 every month until the end of the year.
About 39 million low-income families making less than $75,000 qualify for the new child benefits based on their income.
For individuals earning more than $75,000 a year or couples making more than $150,000, they will receive a smaller benefit or none. About 65 million children are expected to benefit from the tax credit or 88 percent of children in the United States.
“The American Rescue Plan is delivering critical tax relief to middle class and hard-pressed working families with children. With today’s announcement, about 90% of families with children will get this new tax relief automatically, starting in July,” the president wrote in a statement.
He added: “While the American Rescue Plan provides for this vital tax relief to hard working families for this year, Congress must pass the American Families Plan to ensure that working families will be able to count on this relief for years to come. For working families with children, this tax cut sends a clear message: help is here.”