Young Adult Tax Credit Act

Key Points

• This bill creates a new refundable tax credit of $500 per month ($6,000 per year) for young adults ages 18 through 24 who are U.S. citizens, nationals, or residents. Starting in 2028, the amount would automatically increase with inflation.
• To qualify, a young adult cannot be claimed as a dependent on someone else's tax return. This targets the credit at people who are financially independent from their parents or guardians.
• The Treasury Department would send the money as monthly advance payments rather than making people wait until tax season. An online portal would let people sign up, update their information, or choose to receive one annual lump sum instead.
• The monthly payments are protected from garnishment, debt collection, and tax offsets, so recipients can actually keep and use the money. The bill also shields the payments from bankruptcy proceedings.
• The Treasury must run an outreach campaign, working with community organizations and sending direct mailings to eligible people, with special focus on reaching people who do not normally file taxes or have bank accounts.