TaxGuyBill
Level 15

I think many tax professionals (and taxpayers) don't realize that withholding is supposed to change too.  So if they have their W-4 properly filled out to 'break even' at tax time, hypothetically they will still 'break even' at tax time because the W-2 withholding is supposed to compensate for the Advance credit.

Of course that doesn't fit many taxpayers who pay Estimated Tax and other situations.  And that is assuming the IRS actually does come out with new withholding tables/formulas and the employers/payroll companies actually change it.

So besides being a political ploy, I think the Advance credit will primarily help those low-income people that have minimal withholding but have large refunds due to the Child Tax Credit and EIC.  They will be able to get part of it in Advance, rather than as a huge lump-sum.