DETROIT (WXYZ) — In a special town hall, Detroit Mayor Mike Duggan broke down the new child tax credit. A one-time credit meant to help parents after the COVID-19 pandemic.
“This is a lot of money that is going to be coming very soon if you take advantage of it,” Duggan said. “This is basically to offset the damage of COVID to our children this year.”
The total credit is $3,600 for each child 5 and under, and $3,000 for each child age 6 to 17 which is an increase from the previous $2,000 credit. The money comes in monthly payments of either $300 or $250 per child.
"A lot of the tax preparers I know, they don’t know what to do,” said parent Cher Coner.
Coner came with a lot of questions. She's a single parent with two kids set to start high school. That money would go a long way.
“All of those extra expenses, that will be so helpful,” Coner said.
Parents are able to opt-out of the monthly payments and get the credit come tax time, but for thousands of Detroit families, the monthly option will be the way to go.
“There are going to be 20,000 children in this City living in poverty today who will no longer be living in poverty in 6 months,” Duggan said.
Those benefits phase out for higher incomes and only apply to children listed as dependents on your tax return. For Detroiters who have questions or haven’t filed taxes, the city is offering free tax preparation.
They have partnered with the Accounting Aid Society and Wayne Metro Community Action Agency. To schedule an appointment call 2-1-1 or go online at getthetaxfacts.org. The agencies will prepare taxes for free for those making under $57,000 a year.
“I want to make sure every family in this cCty has just as good a CPA working for you,” Duggan said.
After asking her question, Coner found out she was eligible and is anxious for those first payments to arrive this week.
“It will be very helpful for me as a single parent,” Coner said.
The advance monthly payments will come automatically unless you unenroll on the IRS website. For more information, visit the IRS website here.