Advance Child Tax Credit Payments to Begin July 15th
Advance Child Tax Credit Payments to Begin
The IRS recently announced that 2021 Advance Child Tax Credit (CTC) Payments will begin disbursements on July 15, 2021 for the period between July 1, 2021 and December 31, 2021. Recent legislation expanded the existing child tax credit and made the expanded portion payable in advance in monthly payments.
If you have previously qualified for the original Child Tax Credit, you will likely receive a letter from the IRS informing you of your Advance Payment eligibility. If your 2019 or 2020 income is below the threshold for the credit, the IRS should automatically send these advance payments (non-filers or new parents that will qualify in 2021 can sign up to receive the payments using a tool on the IRS website). However, if you are expecting higher income for 2021 (in excess of $75,000 single and $150,000 married filing joint), there is a possibility that some or all advance payments received may need to be repaid when filing your 2021 tax return.
If repayment is a concern, taxpayers may opt out or unenroll from receiving Advance CTC Payments prior to the first payment date (July 15th) or at any time thereafter, via the IRS’s Online Information Portal (to be posted to the IRS website soon).
Opting out of receiving these advance payments does NOT mean you forfeit CTC eligibility for 2021. Instead, you will receive your CTC when you file your 2021 tax return; the amount received will depend on your actual income in 2021.
If you have any questions as it relates to the Advance Child Tax Credit Payments, please let us know.