2021 Child Tax Credit Update
Hello Everyone! We have an official update on the Child Tax Credit that some have been asking about.
Earlier this month, the IRS began sending letters to more than 36 million families who may qualify for monthly Child Tax Credit advance payments. The IRS determines eligibility based on information provided on the 2020 federal tax return (or information from the 2019 tax return if a 2020 tax return has not been filed when the payments begin). Payments are scheduled to begin on July 15, 2021. Subsequent payments are scheduled for August 13, September 15, October 15, November 15, and December 15.
The advance CTC payments will equal half of the total estimated CTC that the taxpayer will claim on their 2021 tax return. The payment amount is determined for each qualifying child as $300 per month for children under age six and $250 per month for children ages 6 to 17. Because the payments are advance payments of the taxpayer’s CTC for 2021, the amounts received will be reported on the 2021 federal tax return and will reduce the remainder of CTC the taxpayer will receive when they file their return.
Several tools will be available on IRS.gov for taxpayers to determine their eligibility, track the status of payments, and opt-out of the advance payments.
The IRS has already launched a Tool for Non-Filers (https://www.irs.gov/credit…/child-tax-credit-update-portal) to sign up to receive advance CTC payments if eligible and a Child TaxCredit Update Portal (https://www.irs.gov/credit…/child-tax-credit-update-portal) to help taxpayers manage Child Tax Credit payments.
An Eligibility Assistant(https://www.irs.gov/…/advance-child-tax-credit…) has also been added to the IRS website to help taxpayers determine whether or not they are eligible for the advance payments.
As always, if you have any questions, we’re here to help.