May 17th tax deadline especially important for new parents

Your Money Matters

SIOUX FALLS, S.D. (KELO) — This year’s tax deadline was pushed back a month, but with just four days left to file, there are plenty of people still working to get theirs in on time.

The deadline is not only important for people who still have a tax bill–but this year, parents have some extra incentive to file their taxes on time.

“This year the government is going to prepay the child tax credit,” Timothy Ness, the owner of Ness Tax & Bookkeeping said.

Part of the American Rescue Plan includes an increase in amount parents receive for each child. What used to be $2,000 per child will now be a $3600 dollar tax credit for children 5 and under and $3000 for kids age 6-17; half will be paid out to parents starting in July.

“You’ll start to see checks of around $300 probably direct deposited on your account to prepay a credit that normally appears on your tax return,” Ness said.

If you’ve recently had a baby or adopted a child, it’s especially important to file on time.

“By filing a tax return by May 17th, this allows the government to know how many children are in your home,” Ness said.

But Ness says some parents may want to opt out of the prepayment program.

“Many people rely on the child tax credit to offset tax, so if you receive this payment early, you could end up owing money at the end of the tax season,” Ness said.

If you already owe money for 2020, you need to pay your bill by the Monday deadline. But even if you don’t normally file taxes, you may want to make sure you file this year to ensure you receive all of the covid relief benefits.

“The stimulus payments are good for everybody, even traditional non filers are encouraged to file so that they can receive stimulus money,” Ness said.

People filing taxes solely to receive their stimulus payments can still file their paperwork to the IRS after the May 17th Deadline.

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