Diplomacy & Crisis News

Ethen Kim Lieser

economy, Americas

Millions have already done so and many do have legitimate reasons for that decision.

Here's What You Need to Remember: “Once you reach your (full retirement age), you can contact the Social Security Administration and ask it to suspend your benefits,” Hagen said. “If you do this, you won’t receive any more Social Security checks until you either request that the Social Security Administration start sending them again or you turn seventy.”  

Despite the ubiquitous warnings from financial planners, the world will not come crumbling down if one decides to claim Social Security benefits at age sixty-two, the earliest age to do so. 

In fact, millions have already done so and many do have legitimate reasons for that decision. However, know that this isn’t for all soon-to-be retirees, as each person’s financial standing is a bit different.  

Eyeing Bigger Checks 

The one clear fact is that it could be a prudent money-related decision to delay filing for as long as possible—and that advice is fully supported by the Social Security Administration (SSA).  

“Workers planning for their retirement should be aware that retirement benefits depend on age at retirement. If a worker begins receiving benefits before his/her normal (or full) retirement age, the worker will receive a reduced benefit. A worker can choose to retire as early as age sixty-two, but doing so may result in a reduction of as much as 30 percent,” according to the SSA website.  

“Starting to receive benefits after normal retirement age may result in larger benefits. With delayed retirement credits, a person can receive his or her largest benefit by retiring at age seventy,” according to the website.  

Meanwhile, the AARP website notes that “your monthly payment will be 76 percent higher if you wait to start benefits at seventy rather than sixty-two, the earliest possible age.”  

Do-Over Possible? 

But what if one already signed up at age sixty-two? Is there a way to change one’s mind?  

Kailey Hagen, an expert finance site Motley Fool noted that “you can change your mind about claiming Social Security as long as it’s been less than one year since you signed up and you return all of the benefits paid to you and any of your family members based on your work history.” 

“If you do this, the Social Security Administration will treat you as if you’ve never claimed Social Security, and when you sign up again later, your checks will be larger,” Hagen said.

But be aware that there is a deadline for one to make this decision. If it has been more than a year since filing, then the individual will have to live with his or her decision. Also, some people just aren’t in the financial position to be able to pay back all of the benefits they have already received.  

There is, though, another smart route one can take.

“Once you reach your (full retirement age), you can contact the Social Security Administration and ask it to suspend your benefits,” Hagen said. “If you do this, you won’t receive any more Social Security checks until you either request that the Social Security Administration start sending them again or you turn seventy.”  

“In the latter case, your benefits will start automatically in the month you turn seventy. Doing this will earn you delayed retirement credits, which increase your future checks,” she added.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn. This article is being republished due to reader interest.

Image: Reuters

Trevor Filseth

Infrastructure Bill,

The Senate is likely to be busy in September, as Senate Majority Leader Chuck Schumer (D-NY) still needs to put together a spending bill that conservative Democrats, including Sens. Joe Manchin (D-WV) and Krystin Sinema (D-AZ), find agreeable.

On Tuesday, the Democrat-controlled House of Representatives advanced its $3.5 billion budget plan to the Senate. The vote was briefly delayed while ten Democratic representatives indicated they would not support it until a vote was held on a smaller bipartisan infrastructure deal negotiated in the Senate. After Speaker of the House Nancy Pelosi (D-CA) committed to bringing it up for a vote within a month, the ten Democrats approved the larger bill, and it passed along partisan lines, with 220 votes in favor and 212 opposed.

The roughly $1 trillion bipartisan bill contains roughly $500 million in new spending for conventional infrastructure, including roads, bridges, the electric grid, railways, and public transit. A number of provisions related to climate were left out of this bill, eliciting complaints from progressive Democrats. Many of these were later added to the larger $3.5 trillion bill. This bill also includes universal pre-K education, Medicare expansion, and increased funding for eldercare.

The issue of passing the smaller, bipartisan bill without passing the larger one has been a point of contention on Capitol Hill. The Congressional Progressive Caucus (CPC), an alliance of progressive Democrats, indicated in an August survey that most of its ninety-six members would not vote to approve one bill unless the other would be approved as well. Rep. Pramila Jayapal (D-WA), the CPC’s chairwoman, confirmed on Tuesday that this remained the group’s position.  

The Senate is likely to be busy in September, as Senate Majority Leader Chuck Schumer (D-NY) still needs to put together a spending bill that conservative Democrats, including Sens. Joe Manchin (D-WV) and Krystin Sinema (D-AZ), find agreeable. Because of the Senate’s 50-50 split, and the Republicans’ strong opposition to the proposed reconciliation bill, any dissenting Democrat in the chamber could kill the bill. Both senators have agreed to the $3.5 trillion spending proposal, substantially increasing its prospects for success.

While most bills can be “filibustered,” or blocked by a single senator until sixty or more vote to continue, reconciliation is a procedural method that exempts bills from filibusters. The March 2021 American Rescue Plan Act, which provided the third round of $1,400 stimulus checks as well as the incoming Child Tax Credit advance payments, was passed through reconciliation. However, Elizabeth MacDonough, the Senate parliamentarian, has declared that Democrats will only receive one more reconciliation bill during the current legislative session—which Schumer and other Senate Democratic leaders are using for this bill.

Trevor Filseth is a current and foreign affairs writer for the National Interest.

Image: Reuters

Trevor Filseth

Child Tax Credit,

July’s checks have mostly arrived by now, and August’s are on their way, with the next round of checks set to be distributed on Wednesday, September 15.

Here's What You Need to Remember: Under the old rules, parents could claim $3,000 in expenses for up to two children, for a maximum credit of $6,000. The American Rescue Plan Act nearly tripled this payout, allowing families to claim up to $8,000 per child, or $16,000 in total.

The American Rescue Plan Act, passed by President Joe Biden in March 2021, provided for an expanded version of the Child Tax Credit. Before the plan, the credit provided a tax credit of $2,000 to parents for each of their children, with no distinction based on age. The credit could only be claimed on one’s tax return, and if a family owed less than $2,000 in taxes, the credit could not be claimed in full.

The American Rescue Plan Act changed all of this. The credit was raised to $3,000 or $3,600 per child per year, depending on the child’s age; it was made fully refundable, meaning that it would still be paid to families who could not discount all of it from their taxes; and, most importantly, half of it is being sent out in advance, in the form of monthly checks from July until December. July’s checks have mostly arrived by now, and August’s are on their way, with the next round of checks set to be distributed on Wednesday, September 15.

This tax credit has proven to be very popular with American families, to the extent that some are pushing for the credit to be made permanent. However, the American Rescue Plan Act also raised another significant tax credit that has received far less attention: the “Child and Dependent Care Tax Credit,” which, according to a recent Bipartisan Policy Center survey, roughly half of all Americans are completely unaware of.

As they sound very similar and fulfill a similar purpose, the two tax credits are sometimes conflated, but they are substantially different in their details. While the Child Tax Credit is intended to cover general child-associated costs, the Child and Dependent Care Tax Credit reimburses parents for specific expenses that they can show they spent on their children, although the rules for how this money can be spent and what expenses can be deducted are somewhat stricter.

Under the old rules, parents could claim $3,000 in expenses for up to two children, for a maximum credit of $6,000. The American Rescue Plan Act nearly tripled this payout, allowing families to claim up to $8,000 per child, or $16,000 in total. This is substantially more than the Child Tax Credit provides; for example, a family of two high school-aged children could receive only $6,000 directly from the Child Tax Credit.

And, like the Child Tax Credit, the American Rescue Plan made the Child and Dependent Care Tax Credit fully refundable, meaning that families without tax liabilities can still claim the payments as cash.

Trevor Filseth is a current and foreign affairs writer for the National Interest. This article is being republished due to reader interest.

Image: Reuters

Ethen Kim Lieser

Child Tax Credit,

There are still reports abound that parents have yet to see the funds in their respective bank accounts.

Here's What You Need to Remember: Do take note that after sending out last month’s Child Tax Credit payments, the IRS admitted that some “mixed-status” families—those with one parent who is a U.S. citizen and the other who is an immigrant—didn’t immediately see the funds in their bank accounts.

The Internal Revenue Service (IRS) and the Treasury Department have confirmed that they are in the process of successfully disbursing the second batch of advance monthly payments worth approximately $15 billion from the expanded Child Tax Credits, but there are still reports abound that parents have yet to see the funds in their respective bank accounts.

According to the agencies, one glitch is due to an unspecified issue, and that up to fifteen percent of families who received the payment in July via direct deposit now will be getting a paper check via the post office this month.

“Like the first payments, the vast majority of families will receive these payments by direct deposit,” the IRS noted in a release. “For those affected, no additional action is needed for the September payment to be issued by direct deposit. Families can visit the Child Tax Credit Update Portal to see if they’re receiving a direct deposit or paper check this month.”

Getting one’s hands on the Child Tax Credits via traditional mail could potentially take a week or longer. “Be sure to allow extra time for delivery by mail through the end of August,” the agency advised.

Glitch No. 2

Do take note that after sending out last month’s Child Tax Credit payments, the IRS admitted that some “mixed-status” families—those with one parent who is a U.S. citizen and the other who is an immigrant—didn’t immediately see the funds in their bank accounts.

The agency confirmed that the nonpayment was indeed a mistake and proper steps have been taken to rectify the matter. 

Lacking Necessary Information

Other eligible parents who may have not received their tax credits might not have the required information—such as an address and routing and bank account numbers—on file at the tax agency. Due to this issue, a recent report released by the Center on Budget and Policy Priorities has indicated that roughly four million children from low-income families are at risk of not receiving any funds from the expanded credits.

For months, the IRS has asserted that the fastest way for Americans to get their hands on the credits or any of the three stimulus checks is to file a federal tax return as soon as possible. The public can also take advantage of the recently launched Non-filer Sign-up Tool, which will help disburse the credits promptly.

The expanded Child Tax Credits, approved under President Joe Biden’s American Rescue Plan last spring, now allow eligible parents to collect as much as $3,600 per year for a child under the age of six and up to $3,000 for children between ages six and seventeen. Broken down, that means a $250 or a $300 payment for each child will be deposited each month through the end of the year.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn. This article is being republished due to reader interest.

Image: Reuters

Ethen Kim Lieser

economy, Americas

The latest estimates suggest that about thirty-six million American families are currently receiving the monthly payments, but the agencies have made it known that it isn’t too late to sign up for the recurring funds.  

Here's What You Need to Remember: A recent report released by the Center on Budget and Policy Priorities revealed that approximately four million children from low-income families are at risk of not receiving the monthly payments if the tax agency doesn’t have the required personal and financial information.

The Internal Revenue Service and the Treasury Department already are two months into the disbursement of the expanded child tax credits that were approved under President Joe Biden’s ambitious American Rescue Plan. 

The latest estimates suggest that about thirty-six million American families are currently receiving the monthly payments, but the agencies have made it known that it isn’t too late to sign up for the recurring funds.  

Bigger Monthly Checks 

In fact, if a person chooses to sign up now, then the remaining payments would indeed be even bigger compared to those who have been receiving the checks since July.  

The chief reason is that the money is an advance on tax credits—of which half is to be delivered this year and the rest to arrive when individuals file their federal tax returns next year. Therefore, even if a person signs up late for the credits, the agencies will try to issue the entire first half of the credits by the time 2022 rolls around.  

For example, if a family missed the child tax credit payments in July but was able to sign up this month, there would indeed be a slight bump in the monthly checks.  

“This means that the total payment will be spread over five months, rather than six, making each monthly payment larger,” the IRS noted in a statement.  

“For these families, each payment is up to $360 per month for each child under age six and up to $300 per month for each child ages six through seventeen,” it continued.  

For weeks, the IRS has been urging potentially eligible Americans to take advantage of the Non-filer Sign-up Tool that will give the tax agency the necessary information—such as an address and routing and bank account numbers—to promptly disburse the funds.  

The IRS has also launched a brand-new feature that enables any eligible family to update their mailing address using the Child Tax Credit Update Portal, which can be found on IRS.gov.  

“This feature will help any family that chooses to receive their payment by paper check avoid mailing delays or even having a check returned as undeliverable,” the IRS says in a release.  

Focus on Low-Income Households  

Being able to reach the nation’s poorest households has become a primary goal of the agency.  

“This important new tax change affects millions of families across the nation, and the IRS wants to do everything it can to help people get the payments,” IRS Wage & Investment Commissioner Ken Corbin, who also serves as the agency’s Chief Taxpayer Experience Officer, said in a statement. 

“Many people miss out on tax benefits simply because they don’t file a tax return,” he added. 

A recent report released by the Center on Budget and Policy Priorities revealed that approximately four million children from low-income families are at risk of not receiving the monthly payments if the tax agency doesn’t have the required personal and financial information.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn. This article is being republished due to reader interest.

Image: Reuters

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