ADVANCE CHILD TAX CREDIT (2021)
Most US Parents are due for a monthly tax credit check beginning in July. With the economy improving and job openings reported across the country, there are few signs of a fourth stimulus check hitting your bank account any time soon but millions of American parents will be getting regular checks or deposits from the IRS starting next month.
We now know the specific dates the Internal Revenue Service expects to send out child tax credit payments. The IRS mailed out notifications to an estimated 38 million parents letting them know they are due for payment on or after July 15th. In the past, filers took the credit at tax time as one lump sum.
The American Rescue Plan passed earlier this year, increasing the existing maximum child tax credit to $3,600 for children under 6 and $3,000 per kid for children between 6 and 17.
It also set up a framework to prepay a portion of those funds over the final six months of 2021 through the IRS. According to the feds, roughly 39 million households will begin receiving checks next month, “without any further action required.”
The IRS says those payments will be scheduled to go out the 15th of each month, unless that date falls on a weekend or federal holiday. That means these are the six dates we should expect payments to go out this year: July 15, August 13, September 15, October 15, November 15 and December 15.
“Households covering more than 65 million children will receive the monthly CTC payments through direct deposit, paper check, or debit cards,” the IRS wrote in a press release last month.
The six payments will cover half of the proposed benefit for the year. That means most parents of a single child between 6 and 17 would see a $250 monthly check. Fully qualified parents of a child under 6 would be eligible for $300 from each check. The remaining portion will be credited at tax filing time, as in previous years.
The payments are fully refundable, meaning people may be eligible even to parents who do not owe taxes. The increased payments will phase out for higher income earners, including parents filing jointly who earn over $150,000.
If you would like to receive the full benefit at tax time rather than monthly, the IRS has one more date to keep in mind. The agency says they will launch a tool by July 1st allowing you to opt-out of the monthly payments in favor of a single credit.