The IRS started sending out advance Child Tax Credit payments to eligible Americans on July 15.
A pair of recently released IRS tools allow you to determine your family’s eligibility as well as manage advance monthly payments — including the option to unenroll. The agency also unveiled a non-filer tool last week, which allows families who don’t normally file taxes to enroll.
The payments are part of a 2021 expansion to the existing Child Tax Credit under the American Rescue Plan. This year, you can get up to $3,600 per eligible child under age 6, and up to $3,000 per eligible child age 6 through 17. You’ll receive half of this fully refundable credit amount in advance monthly payments this year, and the other half when you file your 2021 tax return next spring (unless you opt to receive one payment next year instead of getting half paid monthly).
Here’s how to use the new tools to manage your Child Tax Credit payments, and more information about the credit as the first advance payments approach:
What Are the New Child Tax Credit Tools?
Child Tax Credit Update Portal
The Child Tax Credit Update Portal allows you to see your eligibility and payment history and offers the choice to unenroll from advance payments.
Because the 2021 credit is an estimate based on your 2020 tax return, you may choose to unenroll from advance payments if you have reason to think you may not actually qualify for the amount you expect to receive due to changes in income or family situation. Doing so now can help you avoid having to potentially repay next tax season. The IRS offers these examples of situations where unenrolling may be a good choice:
- Your income in 2021 is too high to qualify.
- Another person qualifies to claim your children as dependents.
- You lived outside of the U.S. for more than half of 2021.
If you’re used to receiving the Child Tax Credit as part of your tax return, you may also choose to unenroll from advance payments simply because you prefer a lump sum when you file your tax return.
As payments begin, the IRS says eligible recipients will also be able to use the Update Portal to check the status of payments and update personal and banking information. You’ll need an ID.me account with the IRS to access the portal, which requires information from your photo ID. There’s also an accessibility guide to help people with disabilities use the portal with assistance from screen readers, magnifiers, and other tools.
Child Tax Credit Eligibility Assistant
The Eligibility Assistant allows families to check their Child Tax Credit eligibility with a series of questions. All you need to use this tool is your most recent tax return, either for tax year 2020 or 2019.
What if I don’t have my tax return?
If you don’t have a copy of your return, you can use an estimate based on your income, filing status, and the number of eligible children you claimed. Use your W-2 or other income statement, and any income adjustments you remember making to estimate the information you’ll need to use the tool.
What to Know about Child Tax Credits
How much will I receive?
For 2021, eligible families can claim up to $3,600 per qualifying child under age 6 and $3,000 per qualifying child between 6 and 17 with the expanded Child Tax Credit. If your child turns 17 in 2021, they still qualify. Previously, parents could claim up to $2,000 per eligible dependent child under age 17.
Advance payments will account for half the total amount you’re eligible for — that means up to $300 monthly per eligible child under age 6 and up to $250 monthly per eligible child age 6 through 17.
The exact amount you receive depends on your modified adjusted gross income (AGI) from your latest tax return. You can receive the full amount if your AGI falls below these benchmark thresholds:
- Single: $75,000
- Head of household: $112,500
- Married filing jointly: $150,000
Above these, your credit amount is reduced by $50 increments for every additional $1,000 in AGI. Even if your income surpasses the threshold for the expanded credit, you can still qualify for the previous $2,000 tax credit, for which previously set income limits remain the same.
When will I receive my payment?
The other big change for 2021 is the introduction of advance payments. You’ll receive half of your total payment amount in monthly increments, beginning July 15, and the other half when you file your 2021 tax return next spring. If you choose to unenroll from advance payments in the Update Portal, you will receive the full amount next spring. Here’s the payment schedule as issued by the IRS:
- July 15
- August 13
- September 15
- October 15
- November 15
- December 15
How will I receive it?
Payments will be made either by direct deposit or mailed check. The IRS will use the bank account information in your latest tax return to issue your payment. If you don’t typically file a return but still want to receive your credit by direct deposit, you can use the non-filer tool to enter your information.
What do I need to do to receive it?
If you filed your 2019 or 2020 tax return and wish to receive advance monthly payments, the IRS says no further action is required. Otherwise, use the non-filer tool to determine your eligibility and automatically enroll. And to get your payments as quickly as possible through direct deposit, make sure your bank account information is up to date.