Under Recent American Rescue Plan, Taxpayers Can See Their Rates Drop

NEW YORK -
Blank checks on an idle press at the Philadelphia Regional Financial Center, which disburses payments on behalf of federal agencies in Philadelphia. (AP Photo/Matt Rourke, File)

Taxpayers who earn less than $75 thousand a year may see their tax bill fall to $0, and those who earn between $75 thousand and $100 thousand will pay 1.8% tax rate, according to a recent report from Congress’ Joint Committee on Taxation.

The nonexistent tax bill is the result of several tax provisions in the recent American Rescue Plan, Fox News 5 reported. In 2018, those who earned between $50 thousand and $75,000 a year would have had to pay an average 2.4% tax rate.

The American Rescue Plan included direct federal stimulus to families, and temporarily raised and expanded the child tax credit to up to $3,6000 per child annually. According to the Joint Committee on Taxation, approximately 48 million households will claim the child tax credit for 2020.

Families are eligible for up to $3,600 for each child under age 6 and as much as $3,000 for children up to age 17 annually. Democrats have announced they intend to make these child tax credits permanent.

President Joe Biden has vowed to raise taxes on corporations and the wealthy to pay for these programs and his proposed $2 trillion infrastructure bill. He has said repeatedly he will not raise taxes on the middle class.

“I keep hearing in the press ‘Biden’s going to raise your taxes’ – anybody making less than $400,000 a year will not pay a single penny in taxes,” Biden said at an event in Virginia on Monday.

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smarcus@hamodia.com