Starting this summer,with can expect to receive their first monthly payment as part of March's massive . You'll receive half your money through monthly payments beginning in July, if your family meets the requirements, and the remainder of your money a year from now -- when you file .
Depending on the age of your dependent, payments will start as a one-time check for $500 and run up to $3,600 per child, split between 2021 and 2022. (See below for more.) And if you have a, that newborn will also count toward the amount you get. ( .) We're expecting to hear more from the IRS about the child tax credit payments before they begin.
We'll tell you how the child tax credit payment schedule will work, including when payments will come, what you'll need to do if you get too much money, how to correct errors using the IRS portal and what happens to yourof a dependent. On a side note, If you're still , you can . This story was recently updated.
What date has the IRS set for when the first child tax credit payment will arrive?
We know the child tax credit payments will begin arriving in July, but a specific date hasn't been announced. The IRS will make additional information about the expanded child tax credit available "as soon as possible," the agency said in a March 12 statement. See our chart below for the likely timeline.
Timeline for the child tax credit payments
|Monthly||Payment ages 5 and younger||Payment ages 6 to 17|
|July 2021: First payment of the year||$300||$250|
|December 2021: Last payment of the year||$300||$250|
|April 2022: Second half of payment||$1,800||$1,500|
How much child tax credit money you could get through monthly payments
Payments will be split between half in 2021 and the rest in 2020. Half of the payment will go out in monthly installments this year, and the other half with your, filed in 2022.
The payments will be up to $300 per month for each qualifying child age 5 and under, and up to $250 per month for each child between the ages of 6 and 17. Note that this amount phases out for those with higher incomes: single people earning more than $75,000 per year, heads of household earning more than $112,500 per year and married couples earning more than $150,000 a year. Your child tax credit payments will begin to phase out by $50 for every $1,000 of income over those threshold amounts, according to Joanna Powell, managing director and certified financial planner at CBIZ.
So if you qualify for $3,000 and you have one dependent, you'd get an estimated $250 per month from July to December, for a total of $1,500. You then need to claim the rest of your child tax credit amount when you file your 2021 taxes next year (2022). Here's more on the.
You canto get an estimate of how much you could get.
2021 child tax credit amount
|Ages 5 and younger||Up to $3,600, with half as $300 monthly payments|
|Ages 6 to 17||Up to $3,000, with half as $250 monthly payments|
|Ages 19 and 24, full-time college students||$500|
What about babies born in 2021 or older dependents?
If you, they will be counted toward the child tax credit payment of $3,600, if you qualify. Children who are adopted can also qualify if they're US citizens. As for your older dependents, if they're between the ages of 18 and 24 they can qualify for $500 each -- but note that if your kids are between the ages of 19 and 24, they must be enrolled in college full-time.
How is the new child tax credit different from how it worked before?
The first thing to know is you won't get your child tax credit payments all at once this year. The "credit" part means the amount you owe in your 2021 taxes will be reduced by the "credit" you gain from your eligible dependents. That could either reduce your payment to the IRS for your 2021 taxes (filed in 2022) or else increase your. Normally, you'd receive that "credit" as a tax refund in 2022. But the plan is to bring you money sooner, which is why the checks will start coming in 2021 as "advance payments."
This logic also explains why your 2021 child tax credit is split into two parts. The first part, in 2021, is the advance payment you can start using right away. The second part will apply to your 2021 taxes -- which you file in 2022. Yes, it's confusing. Hopefully, we answer some of your questions below.
How the IRS will likely send your child tax credit money
The way your child tax credit money arrives could very well depend on, Powell told CNET. The IRS has changed this in the past, so we'll need to hear official guidance from the agency.
For example, if you gotvia , it's quite possible your child tax credit could arrive that way, too. If you receive , it's possible you might get your payment on a Direct Express card. might also have a different delivery method.
Paper checks andare other delivery methods used for stimulus checks. We'll keep our ear to the ground for emerging details and will provide updates as we learn more.
Important details for parents who have shared custody of a dependent
For the first two stimulus checks, some parents whobut weren't married to each other were entitled to each claim money for the same child. That was only if they alternated years for claiming the dependent -- in other words, if one parent claimed the child on their taxes in odd years and the other claimed the child on their taxes in even years.
This is no longer allowed for the third check, and we're told it won't work that way for the child tax credit payments either. Here's what we know so far about the.
Your 2020 tax return has an impact on the child tax credit amount you'll get
Taxpayers said March 12. IRS Commissioner Charles Rettig said payments will be automatic for those who , the new tax deadline.related to the new legislation and shouldn't take any other "unnecessary steps," the IRS
However,to get the credit, even if they don't usually submit tax returns. This will let the IRS know how many dependents are in the household who count toward the child tax credit benefits.
The IRS child tax credit portal opens July 1. Here's what that means if you're expecting payments
The IRS will launch an online portal by July 1, Rettig said, but the IRS won't have the resources to build this until . Once the child tax credit portal is available, recipients can log in to update their information if their circumstances have changed. For example, if you have a child in 2021, the IRS wouldn't have that information on file yet, so updating those details may help you get a larger tax credit payout.
Can you get all the child tax credit money at once, instead of smaller monthly payments?
Yes, but not this year. If you thought you could cash in on all the child tax credit money in July, that's not the case. Instead, you can opt out of getting the monthly advance payments and receive a lump sum in spring 2022 as a credit when you file your taxes. That means you'd get a larger total in your tax refund or owe the IRS less money because the credit would be deducted from your total.
You'll be able to use the online portal to opt out. Again, you wouldn't receive any money from this tax credit until 2022.
What to expect when the child tax credit monthly payments end in December
The final advance payment of the child tax credit is scheduled to end by Dec. 31, 2021, with the rest coming in 2022 with tax season. But President Joe Biden wants to make the higher payments permanent, White House press secretary Jen Psaki said March 16: "We're having those discussions with Congress."
If you get overpaid, will the IRS expect you to return the money?
Yes. The child tax credit isn't as flexible as the. If you receive more money than you should have, you will have to pay it back. One example of this happening is if you and the other parent of your child (who is not your spouse) are .
When you file your 2021 tax return (in 2022), if your tax situation isn't what the IRS has in its system and you weren't entitled to as much as you received, you'll have to give the overpayment back. To avoid this tax inconvenience, make sure all your information is updated before the payments start arriving. The portal will open July 1 for you to make adjustments.
For more information, here are the. Plus, here's and how to track .